Bank of America will let you overdraft, but you will pay a fee and the bank decides whether to cover it

Bank of America does not automatically prevent overdrafts. If you try to spend more than you have, the bank may cover the transaction and charge you an overdraft fee. As of 2024, that fee is $35 per overdraft transaction. You can overdraft $500, $1,000, or any amount — the fee stays the same per transaction, not per dollar.

The catch is that Bank of America is not required to cover your overdraft. The bank can decline the transaction instead, which means your debit card or check will be rejected at the point of sale. There is no way to know in advance which transactions the bank will cover and which it will decline. This unpredictability is why overdraft protection exists as a separate product.

If you regularly overdraft or worry you might, you have options beyond hoping the bank covers it. Understanding how Bank of America's overdraft system actually works — and what it costs — matters before you find yourself $500 short.

Key Takeaways

  • Bank of America charges $35 per overdraft transaction it covers, regardless of how much you overdraft.
  • The bank can decline your transaction instead of covering it, and you cannot predict which it will do.
  • Overdraft protection links your checking account to savings or another account and prevents overdrafts by transferring money automatically.
  • If you overdraft repeatedly, the bank may close your account or flag you in ChexSystems, which affects your ability to open accounts elsewhere.
  • Opting out of overdraft coverage means debit card and ATM transactions will be declined rather than covered with a fee.

How Bank of America decides whether to cover your overdraft

When you attempt a transaction that would overdraft your account, Bank of America runs a real-time decision. The bank looks at your account history, the size of the overdraft, and whether you have overdrafted before. Transactions under $1 are often covered. Large overdrafts or repeated overdrafts are more likely to be declined.

The bank does not publish the exact rules for this decision. Account age, your relationship with the bank, and your deposit history all factor in, but the weighting is internal. This means two customers with similar overdraft amounts may see different outcomes.

If the bank covers your overdraft, you have until the end of the next business day to bring your account back to zero or positive. If you do not, the bank charges the $35 overdraft fee. If you remain overdrawn past that window, additional fees may explore — Bank of America charges an additional $35 per day if your account stays negative for more than five consecutive business days, up to a maximum of $140 per statement cycle.

Overdraft protection: how to prevent overdrafts automatically

Overdraft protection is a service that links your checking account to another account — usually your Bank of America savings account, money market account, or line of credit. When a transaction would overdraft your checking account, the bank automatically transfers money from the linked account instead.

The transfer happens when ready for debit card transactions and within one business day for checks and ACH transfers. You are charged a transfer fee, not an overdraft fee — typically $10 per transfer at Bank of America, which is less than the $35 overdraft fee. You can set a minimum balance threshold, so transfers only happen if your checking account would drop below a certain amount.

To set up overdraft protection, log into your Bank of America online account or call 1-800-432-1000. You can link any Bank of America deposit account you own. If you do not have a savings account, you can open one at the same time. The protection takes effect when ready once activated.

What happens if you overdraft repeatedly

Bank of America monitors overdraft patterns. If you overdraft frequently — typically more than six times in a rolling twelve-month period — the bank may send you a warning letter. Continued overdrafting can result in account closure.

When Bank of America closes an account for excessive overdrafts, the closure is reported to ChexSystems, a banking history database. Other banks check ChexSystems when you explore for a new account. A closure for overdraft abuse can make it difficult or impossible to open a checking account at other banks for up to five years, depending on the bank's policy.

If your account is closed, you will receive a notice in the mail with a important date to withdraw your remaining balance. After that date, the bank may return any deposits or send them to your state's unclaimed property program.

Opting out of overdraft coverage

You have the right to opt out of overdraft coverage for debit card and ATM transactions. If you do, the bank will decline these transactions rather than cover them with a fee. This prevents overdraft fees but also means your card may be rejected at checkout.

Opting out does not affect checks or ACH transfers — the bank can still cover those and charge a fee. To opt out of overdraft coverage for debit and ATM transactions, call 1-800-432-1000 or visit your local branch. The change takes effect within one business day.

Many people opt out specifically to avoid the surprise of overdraft fees. If you know you spend close to your balance, declining coverage means you will find out when ready rather than discovering a $35 charge later.

The cost of overdrafting $500 at Bank of America

If you overdraft $500 and the bank covers it, you pay $35 when ready. If you do not bring your account positive within one business day, you pay another $35 at the end of the next day. If your account stays negative for five or more consecutive business days, you pay an additional $35 per day, up to $140 total per statement cycle.

In the worst case — overdrafting $500 and leaving it negative for a full week — you could pay $175 in fees on top of the original $500 you owed. This is why overdraft protection or opting out matters: the fee structure is designed to push you toward one of those two choices.

If you use overdraft protection instead, you pay $10 per transfer. Overdrafting $500 once costs $10. Overdrafting $500 five times in a month costs $50 in transfer fees, compared to $175 in overdraft fees under the worst-case scenario above.

Frequently Asked Questions

Can Bank of America freeze my account if I overdraft?

Bank of America can freeze your account if it suspects fraud or if you have an outstanding debt to the bank. Overdrafting alone does not trigger a freeze, but repeated overdrafts can lead to account closure. A freeze is different from closure — a frozen account prevents new transactions but does not close the account itself.

Will overdrafting at Bank of America affect my credit score?

Overdrafting does not directly appear on your credit report because it is not a credit transaction. However, if the bank sends your overdrawn account to a collection agency, that collection account will appear on your credit report and damage your score. This typically happens only after months of non-payment.

What if I overdraft and then deposit money the same day?

Bank of America processes deposits and withdrawals in a specific order each day, not in the order they occurred. Deposits typically post at the end of the business day, after overdraft decisions have been made. If you overdraft in the morning and deposit in the afternoon, the bank may still charge an overdraft fee because the overdraft was processed first.

Can I get an overdraft fee refunded?

Bank of America may refund one overdraft fee if you call and ask, particularly if you have a good account history and it is your first request. The bank does not have a formal policy on this, so the outcome depends on the representative you speak with. Call 1-800-432-1000 and explain the situation. Do not expect a refund if you have overdrafted multiple times or requested refunds before.

Is overdraft protection the same as a line of credit?

No. Overdraft protection transfers money from another account you own. A line of credit is borrowed money that you repay with interest. Bank of America offers both products, but they work differently. Overdraft protection is faster and cheaper for small, occasional overdrafts. A line of credit is better if you need to borrow larger amounts regularly.