Bank of America lets you overdraft, but only if you opt in, and you'll pay a fee for each transaction that goes over your balance

Bank of America does not automatically overdraft your checking account. You have to turn on overdraft protection yourself through your online banking or by visiting a branch. Once it's on, the bank will cover transactions that would otherwise bounce — but each one costs you $35 (as of 2024, though this can change). You can also link a savings account or credit card to cover overages instead of paying the per-transaction fee, which is often cheaper if you overdraft more than once a month.

The key thing to understand is that overdraft protection is not information programs. It's a loan you repay when ready, with a fee attached. If you spend $50 more than you have and overdraft protection is on, you'll owe that $50 back plus $35. If you don't repay it quickly, you can rack up multiple fees in a single day.

Key Takeaways

  • Overdraft protection must be turned on manually through your Bank of America account — it is not the default.
  • Each overdraft transaction costs $35, and the bank can charge up to three fees per day, meaning a single shopping trip could cost you $105 in fees.
  • You can link a savings account or credit card instead of paying per-transaction fees, which saves money if you overdraft regularly.
  • The bank will not overdraft you on ATM withdrawals or recurring bill payments unless you specifically opt in to those categories.
  • If your account stays overdrawn for more than a few days, the bank may close your account and report you to ChexSystems, making it harder to open accounts elsewhere.

How to turn overdraft protection on or off

Log into your Bank of America online account and go to Account Services. Look for "Overdraft Protection" or "Overdraft Settings" — the exact wording varies by account type. You'll see options to turn it on for debit card purchases, checks, and ACH transfers (automatic bill payments). You can turn it on for some categories and leave it off for others.

If you prefer not to use overdraft fees at all, leave the setting off. When you do, transactions that would overdraft you will straightforward be declined at the point of sale — your card will be rejected, or your check will bounce. This is inconvenient but costs you nothing. You can also call Bank of America at the number on the back of your card and ask them to disable overdraft protection, and they'll do it over the phone.

What overdraft costs and how fees stack up

Bank of America charges $35 per overdraft transaction. This means if you make three separate purchases while overdrawn, you pay $105 in fees, not $35 total. The bank can charge up to three overdraft fees per day, so a single day of spending can cost you up to $105 even if you only go over by $10.

There's also an extended overdraft fee of $35 if your account stays negative for more than five business days. So if you overdraft on a Friday and don't deposit money until the following Thursday, you'll pay the overdraft fee for each transaction plus the extended fee on top.

The math gets worse quickly. If you overdraft by $50 on Monday, pay $35 in fees, and don't fix it by Friday, you'll pay another $35 extended fee — $70 total for a $50 problem. This is why overdraft is expensive debt, even though it feels temporary.

Linking a savings account or credit card instead

Rather than paying $35 per overdraft, you can link a savings account or credit card to your checking account. When you overdraft, the bank transfers money from the linked account to cover it. This costs nothing if you have the money in savings, or it may cost you a credit card cash advance fee (usually 3 to 5 percent) if you use a credit card.

To set this up, go to the same Overdraft Settings page and select "Transfer from another account" instead of "Overdraft Protection." You'll choose which account to pull from. If you have a Bank of America savings account, transfers are when ready and free. If you link an outside account, transfers may take a day and could have fees depending on your bank.

This option only makes sense if you actually have money in the linked account. If you link a savings account that's also empty, the overdraft will fail and you'll be charged a fee anyway. Make sure the linked account has a buffer — at least a few hundred dollars — so you're not just moving the problem around.

Transactions that won't overdraft even if protection is on

Bank of America will not overdraft you on ATM withdrawals, even if overdraft protection is turned on. If you try to withdraw $100 and only have $50, the ATM will decline the transaction. The same applies to recurring bill payments set up through the bank's bill pay system — those won't overdraft you either.

Debit card purchases, checks, and one-time ACH transfers (like paying a bill manually) will overdraft if protection is on. This is important because it means you can't accidentally overdraft at an ATM, but you can easily do it at a store or online.

What happens if you stay overdrawn too long

If your account stays negative for more than 30 days, Bank of America will usually close it. Before that happens, you'll get warning notices in the mail and through your online account. Once the account is closed, the bank reports you to ChexSystems, a banking history database that other banks check when you try to open a new account.

Being reported to ChexSystems doesn't ban you from banking, but it makes it much harder. Many banks will deny you or require you to use a second-chance checking account with higher fees. You can dispute inaccurate information with ChexSystems, but if the overdraft is real, the report will stay for five years.

If you fall behind on overdraft fees, the best move is to deposit money as soon as you can and call the bank to explain. Bank of America sometimes reverses one or two fees if you have a good history and ask, though they're not required to. The longer you wait, the less likely they are to help.

Overdraft vs. a line of credit or credit card

Overdraft is expensive compared to other short-term borrowing. A $35 fee on a $100 overdraft is an annual rate of about 12,775 percent if you repay it in a week. A credit card cash advance or a personal line of credit costs far less, even with interest.

If you find yourself overdrafting regularly, the real problem is that your income doesn't match your spending. Overdraft protection masks that problem and makes it expensive. A better move is to build a small emergency fund (even $200 to $500 helps), use a credit card for unexpected costs, or look at whether your budget needs to change.

If you're overdrawn because of a timing issue — your paycheck hasn't hit yet but bills are due — ask your employer about early direct deposit or look into a paycheck advance app. These are faster and often cheaper than overdraft fees.

Frequently Asked Questions

Can Bank of America overdraft me without my permission?

No. Overdraft protection is off by default and you have to turn it on yourself. If you never opt in, the bank will decline transactions that would overdraft you instead of covering them. You can also call and ask them to turn it off permanently.

How many overdraft fees can I be charged in one day?

Bank of America can charge up to three overdraft fees per day, each at $35. So if you make multiple purchases while overdrawn, you could pay $105 in a single day. There's also an extended overdraft fee of $35 if your account stays negative for more than five business days.

Will Bank of America reverse overdraft fees if I ask?

Sometimes. If you have a good account history and call to explain, the bank may reverse one or two fees as a courtesy. They're not required to, and the longer you wait to ask, the less likely they are to help. It's worth calling, but don't count on it.

What's the difference between overdraft protection and overdraft fees?

Overdraft protection is the feature you turn on that allows the bank to cover transactions over your balance. Overdraft fees are what you pay for using it — $35 per transaction. You can have protection on but never use it if you don't spend more than you have.

If I link a savings account, will transfers happen automatically?

Yes. If you set up overdraft protection to transfer from a linked Bank of America savings account, the transfer happens when ready when you overdraft. If you link an outside bank, the transfer may take a day and could have fees. Make sure the linked account has money in it, or the transfer will fail and you'll be charged an overdraft fee anyway.