Bank of America lets you overdraft a checking account, but only if you opt in to overdraft coverage

Bank of America does not automatically overdraft your account. By default, debit card transactions and ATM withdrawals will be declined if you don't have enough money. However, Bank of America offers two ways to cover overdrafts if you choose to use them: overdraft protection (which links another account or line of credit) and overdraft coverage (which allows negative balances up to a limit). You have to turn on overdraft coverage yourself—it is not on by default.

The distinction matters because overdraft protection prevents overdrafts entirely by pulling money from another source, while overdraft coverage allows your account to go negative and charges you a fee each time it does. Most people who end up paying overdraft fees have overdraft coverage turned on without realizing it, or they turned it on years ago and forgot.

Key Takeaways

  • Bank of America overdraft coverage is optional and must be turned on in your online banking settings or at a branch—it does not happen automatically.
  • Each overdraft costs $35 per transaction, and Bank of America will charge up to three overdraft fees per day, meaning a single day can cost you $105.
  • Overdraft protection (linking a savings account or credit line) prevents overdrafts instead of charging fees, and is a better choice if you want coverage.
  • Transactions post in a specific order—checks and ACH payments first, then debit card and ATM withdrawals—so the order you make purchases does not determine which ones overdraft.
  • You can turn overdraft coverage off at any time, and Bank of America will not charge fees for transactions declined after you disable it.

What overdraft coverage costs and how the fees stack up

Bank of America charges $35 per overdraft transaction. A transaction is a single purchase, ATM withdrawal, or check—not a single day. If you overdraft four times in one day, you pay $140 in fees, not $35. Bank of America caps overdraft fees at three per day, so the maximum you can be charged in a single day is $105.

The fees do not stop after one day. If your account stays negative, Bank of America charges an additional $35 per day after five consecutive days overdrawn, up to a maximum of $140 per month in these extended overdraft fees. This means a single overdraft incident can cost you $35 for the transaction, then $35 per day for up to four more days, then $140 total for the month—though the daily fees cap at $140 total per calendar month.

These fees are separate from any fees your merchant might charge. If you overdraft at a store, the store may also charge you a returned-item fee on top of Bank of America's overdraft fee.

Overdraft protection versus overdraft coverage—which one to choose

Overdraft protection links your checking account to another account (usually a savings account) or a credit line. When a transaction would overdraft your checking account, Bank of America automatically transfers money from the linked account instead. This prevents the overdraft from happening and avoids the $35 fee. Bank of America charges a small transfer fee (usually $10) only if you use the transfer, and only once per day, so it is much cheaper than overdraft coverage.

Overdraft coverage allows your checking account to go negative up to a limit (usually $100 to $500 depending on your account type and history). Each transaction that causes an overdraft costs $35. You pay the fee whether you transfer money back in when ready or leave the account negative for days.

If you want any overdraft protection at all, overdraft protection is the better choice because it costs less and prevents the overdraft rather than charging you for it. To set up overdraft protection, log into your Bank of America online banking, go to Account Services, and select Link Accounts. You can choose which account to link and set a daily transfer limit.

How Bank of America decides which transactions overdraft first

Bank of America does not process transactions in the order you make them. Instead, it uses a specific posting order that can make overdrafts happen in an unexpected sequence. Understanding this order helps you predict which transactions will overdraft if your balance is low.

Bank of America posts transactions in this order: checks and ACH payments (like bill pay) first, then debit card purchases and ATM withdrawals. This means if you have $100 in your account and you make a $60 debit card purchase, then write a $50 check, the check posts first and overdrafts your account by $10, even though you made the debit card purchase first. The debit card transaction then overdrafts you by another $60.

This posting order is why you can overdraft even if you thought you had enough money for your purchases. Bank of America does not hold pending transactions in the order they were made—it rearranges them by type when they actually post to your account.

How to turn overdraft coverage on or off

To change your overdraft coverage settings, log into your Bank of America online banking account and go to Account Services. Select the checking account you want to change, then look for Overdraft Coverage or Overdraft Settings. You will see a toggle or button to turn coverage on or off. If you turn it off, Bank of America will decline transactions that would overdraft your account instead of charging you a fee.

You can also call Bank of America at the number on the back of your debit card or visit a branch to change your overdraft settings. A representative can turn coverage on or off when ready and explain your options for overdraft protection.

If you turn off overdraft coverage, transactions that would have overdrafted will be declined at the point of sale. You will not be charged a fee, but the merchant will see the transaction as declined. This is why some people keep overdraft coverage on—they prefer to pay the fee rather than have a purchase declined in front of others—but the long-term cost of overdraft fees is usually much higher than the embarrassment of a declined transaction.

What happens if you overdraft and cannot pay it back

If your account stays negative and you do not deposit money to cover it, Bank of America will eventually close your account and report you to ChexSystems, a banking history database. This makes it harder to open accounts at other banks. Bank of America may also send your account to a collection agency if the negative balance is large enough.

If you overdraft and realize you cannot pay it back when ready, contact Bank of America as soon as possible. Some branches will waive one or two overdraft fees per year if you have a good account history and ask. Bank of America is more likely to waive fees if you call before the fee posts rather than after. There is no may provide, but asking costs nothing.

If you are overdrawn by a large amount, you can also ask about a payment plan. Bank of America will not always offer one, but it is worth asking before the account goes to collections.

Overdraft fees versus NSF fees—what is the difference

Overdraft fees are what Bank of America charges when your account goes negative and you have overdraft coverage turned on. NSF fees (non-sufficient funds fees) are what Bank of America charges when a transaction is declined because you do not have enough money and you do not have overdraft coverage. Both cost $35 per transaction at Bank of America.

The practical difference is that an overdraft fee means your account went negative (you spent money you did not have), while an NSF fee means the transaction was rejected (you tried to spend money you did not have, but the transaction did not go through). If you have overdraft coverage on, you will pay overdraft fees. If you have it off, you will pay NSF fees only if a merchant tries to charge your account after it has already been declined—which is rare.

Most people are better off turning overdraft coverage off and accepting declined transactions, because declined transactions are free and overdraft fees are not.

Frequently Asked Questions

Can I overdraft my Bank of America account at an ATM?

Yes, if you have overdraft coverage turned on. ATM withdrawals are treated like any other transaction and will overdraft your account if you do not have enough money. The $35 overdraft fee applies to ATM withdrawals just like debit card purchases.

Does Bank of America charge overdraft fees on pending transactions?

No. Overdraft fees are only charged when a transaction actually posts to your account, not when it is pending. However, Bank of America may place a hold on your available balance for pending transactions, which can make your available balance lower than your actual balance and cause you to overdraft when the pending transaction posts.

What if I deposit money after I overdraft but before the fee posts?

If you deposit money that brings your balance positive before the overdraft fee posts, Bank of America will not charge the fee. However, fees usually post within one business day, so you have a narrow window. Checks take longer to clear, so depositing a check may not prevent the fee in time.

Can I get my overdraft fees refunded?

Bank of America may refund one or two overdraft fees per year if you call and ask, especially if you have a good account history and have not had fees refunded recently. There is no may provide, and the bank is more likely to refund fees if you call before they post. Fees that have already posted are harder to get refunded.

What is the overdraft limit on a Bank of America checking account?

The overdraft limit varies by account type and your banking history. Most checking accounts can overdraft between $100 and $500. Bank of America does not publish a standard limit, and your limit may be different from another customer's limit. You can ask your branch what your overdraft limit is.