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Salal Credit Union

What You Need to Know About Overdrafts

Life can be hectic, but with the right tools, you can stay on top of your finances.

 

What is an overdraft?

An overdraft occurs when transactions such as checks, debit card purchases, or ATM withdrawals exceed your account balance. An overdraft can occur for many reasons. For example, many of us prefer to keep our money where it earns interest—savings and money markets—but if we forget to transfer money to checking before that mortgage payment goes out a fee can result as explained below.

At Salal’s discretion, we may pay transactions that overdraw your checking account, or we may decide to return the items. Items we return are considered non-sufficient funds (NSF) items and we charge NSF fees. When we decide to pay an item which overdraws your account, we charge overdraft fees. The payment of items which causes an overdraft in your account is never guaranteed and you should not write checks or initiate any debits to your checking account if payment of those items would exceed the balance in your account. Payment of ATM and one-time debit card transactions will not be paid into overdraft unless you have expressly opted in for payment of those types of transactions.

Will I be notified of an overdraft?

You will receive a notice informing you if an item was not paid due to insufficient funds in your account and the amount of the NSF fee(s) you were charged, if applicable. If we pay an item which overdraws your account, you will be expected to make a deposit as soon as possible to bring your checking account to a positive balance. If your checking account remains overdrawn, we will send you notices and will close your checking account if the required deposit is not made within the timeline we specify. Checking accounts closed for this reason are reported to a consumer reporting agency and may impact your ability to obtain a checking account or any other type of deposit account.

In what order are my items processed?

We ordinarily process and post debits to your checking account throughout the day in the manner explained below.

  • Checks—posted nightly from lowest to highest dollar amount
  • Signature-based debit card transactions—posted daily in the order received from our network processor
  • ACH—posted daily from lowest to highest dollar amount
  • PIN-based debit card transactions—posted real time (as the transaction occurs)

How much will you charge me for overdrafts?

We charge NSF and overdraft fees which are $29 per item with a daily maximum of $116. Please refer to the Consumer Product & Fee Disclosure here.

What are the standard overdraft practices that come with my account?

We do authorize and pay overdrafts for the following types of transactions:

  • Checks and other transactions made using your checking account number
  • Automatic bill payments

We do not authorize and pay overdrafts for the following types of transactions unless you ask us to (see below):

  • ATM transactions
  • Everyday debit card transactions

We pay overdrafts at our discretion, which means we do not guarantee that we will always authorize and pay any type of transaction. If we do not authorize and pay an overdraft, your transaction will be declined.

Overdraft protection is only available on eligible accounts. If you are eligible and we pay items, you will be assessed an overdraft fee which is $29 per item with a daily maximum of$116. Please refer to the Consumer Product & Fee Disclosure here.

If the Credit Union pays a check or other item for which your account does not have sufficient available funds, you agree to make a deposit as soon as possible to bring your account to a positive available balance including the amount of the item(s) and any overdraft transfer, NSF, overdraft, or Courtesy pay fees, all of which shall be due and payable on-demand or within 30 days of the overdraft occurrence.

How can I better monitor my account?

Salal has tools to help you manage your checking account and prevent these unnecessary fees:

Mobile & Online Banking. Salal’s free Mobile and Online Banking makes it possible for you to monitor your accounts as often as you like from anywhere you have an Internet connection. Not only can you better avoid NSFs or overdrafts by having a clearer idea of the balance remaining in your account, you can also keep an eye out for suspicious activity that may indicate fraud. You may sign up for Mobile and Online Banking by enrolling via our secure login box on the homepage or by calling us at 800.562.5515 or 206.298.9394.

Alerts. Available in Salal’s Mobile and Online Banking, alerts notify you when your account balance dips below an amount you’ve specified. In Bill Pay, “eNotifications” and “Reminders” notify you of payments and transfers so you are aware of how much money remains in your account.

BALANCE. Salal has partnered with BALANCE Financial Fitness to offer free, confidential counseling on money matters to all Salal members. Get help budgeting, understanding credit, saving for a down payment, or finding ways out of debt. From our website, salalcu.org, click “Personal,” then “FINANCIAL EDUCATION.”

Is a checking account right for me?

For some, a checking account may be more of a concern than a convenience. If you’re paying frequent NSF and overdraft fees, perhaps another option would work better for you.

Is there a less costly option if my account becomes overdrawn?

Salal offers Overdraft Transfer Protection. This service allows you to designate other Salal accounts (savings, credit card, line of credit, money market) from which to transfer funds if there’s not enough in your checking to cover payment of items. Fees for this service vary; call 800.562.5515 for details. A fee is assessed for each transfer.

What are some other ways I can pay besides using my checking account?

Money orders and cashier’s checks. Unlike regular checks, where the money isn’t debited from your account until the check is deposited by the payee, money orders and cashier’s checks must be purchased from the credit union in the amount you need. This can reduce confusion over how much money is left in your account. While money orders and cashier’s checks come with a small fee, they are less expensive than overdraft or NSF fees. Savings account and ATM card. With a Salal savings account, you can earn dividends while still retaining access to your funds, via our ATMs. You can also use your savings account to purchase money orders and cashier’s checks.

Savings account. With a Salal savings account, you can earn interest while still retaining access to your funds, via our ATMs. You can also use your savings account to purchase money orders and cashier’s checks.