Bank of America overdraft happens when you spend more money than you have in your checking account
When you write a check, use your debit card, or set up an automatic payment for more than your balance, Bank of America can cover the shortage. This is called an overdraft. The bank pays the transaction and you end up with a negative balance — money you owe back to the bank.
Bank of America does not automatically overdraft your account. You have to turn on overdraft protection first, and even then, the bank decides whether to cover each transaction. Not every overdraft gets paid — the bank can decline to cover a transaction, which means it bounces and you get a different fee instead.
Understanding how this works matters because overdrafts are expensive. A single overdraft can cost you $35, and if you overdraft multiple times in one day, you can be charged multiple times. The costs add up fast, especially if you are living paycheck to paycheck.
Key Takeaways
- Bank of America charges $35 per overdraft transaction, and you can be charged multiple times per day if you overdraft more than once.
- You must opt in to overdraft protection to allow the bank to cover transactions that exceed your balance; without it, transactions are declined.
- Bank of America can also transfer money from a linked savings account to cover a shortfall, which costs $12 per transfer instead of $35.
- The bank can reverse one overdraft fee per year if you ask, but only if you have been a customer for at least six months.
- Overdraft protection is different from a line of credit — it is not a loan you explore for, just permission to go negative.
How to turn on overdraft protection in your Bank of America account
Log into your Bank of America online account or use the mobile app. Go to Settings, then Overdraft Protection. You will see options to turn on overdraft coverage for different types of transactions — debit card purchases, ATM withdrawals, checks, and automatic payments.
You can turn on overdraft protection for some transaction types and leave it off for others. For example, you might allow overdrafts on debit card purchases but not on ATM withdrawals. The choice is yours, and you can change it anytime.
If you do not turn on overdraft protection, the bank will decline transactions that exceed your balance. Your debit card will be rejected at the register, your check will bounce, or your automatic payment will not go through. You will not be charged an overdraft fee, but you may face other consequences — a store might refuse your card, or a bill payment might be late.
What overdraft costs and how fees stack up
Each overdraft transaction costs $35. If you overdraft three times in one day, you are charged $35 three times — $105 total. The bank can charge you up to four overdraft fees per day, though some days you might have more transactions than that.
Bank of America also charges an overdraft item fee of $35 if a check or automatic payment bounces because you do not have enough money and overdraft protection is off. This is the same price as an overdraft fee, but it applies when the bank declines to cover you instead of when it does.
There is a limit to how much you can be charged. The bank will not charge you more than $280 in overdraft fees in a single week, even if you overdraft many times. This is called the overdraft fee cap.
Using a linked savings account instead of overdraft protection
Bank of America offers a cheaper alternative called Overdraft Protection Transfer. If you have a savings account linked to your checking account, you can set up automatic transfers to cover shortfalls. When your checking account balance drops below zero, the bank moves money from savings to checking.
Each transfer costs $12 instead of $35. If you overdraft once a month, this saves you $23 per month — $276 per year. The transfer happens automatically, so you do not have to do anything, but you do need to have money in savings for it to work.
You can set a minimum balance threshold. For example, you can tell the bank to transfer money from savings only if your checking balance falls below $100. This way, you keep a small cushion without overdrafting at all.
What happens if you overdraft repeatedly
Bank of America monitors overdraft patterns. If you overdraft frequently — the bank does not publish an exact number, but patterns of five or more overdrafts per month are considered heavy use — the bank may contact you or restrict your account.
In some cases, the bank may close your checking account if overdrafting continues. This is rare and usually happens only after repeated warnings, but it is possible. If your account is closed, you will have trouble opening another account at Bank of America for a period of time.
The bank also reports overdraft information to ChexSystems, a banking history database. If you have a pattern of unpaid overdrafts or bounced checks, other banks may see this record and deny you when you try to open an account elsewhere.
How to get an overdraft fee reversed
Bank of America allows you to request a reversal of one overdraft fee per year, but only if you have been a customer for at least six months and your account is in good standing. Call the customer service number on the back of your card and ask to speak with a representative about a courtesy reversal.
Be honest about why the overdraft happened. If it was a one-time mistake or an unexpected expense, the bank is more likely to reverse the fee. If you have a pattern of overdrafts, the bank may decline. There is no may provide, but it costs nothing to ask.
Some customers have better luck asking in person at a branch. If you have a relationship with a branch manager or have been a long-time customer, visiting in person and explaining the situation can sometimes result in a reversal even if a phone call does not.
Alternatives to overdraft protection
The safest way to avoid overdraft fees is to not overdraft at all. Set up account alerts so you know when your balance is low. Most banks, including Bank of America, let you set a threshold — for example, an alert when your balance drops below $200. Check your balance before making large purchases or setting up automatic payments.
If you are living paycheck to paycheck and overdrafts are a regular problem, consider a credit builder loan or a small personal loan instead. These are designed for people building credit and cost less than repeated overdraft fees. A credit union may offer better terms than a bank.
Some employers offer earned wage access, which lets you withdraw a portion of your paycheck before payday. This is not a loan — you are taking money you have already earned. It costs less than overdraft fees and does not require a credit check.
Frequently Asked Questions
Can Bank of America overdraft my account without my permission?
No. You must opt in to overdraft protection. Without it, the bank declines transactions that exceed your balance. However, the bank can still charge you a fee for the declined transaction in some cases.
How long do I have to pay back an overdraft?
There is no set important date. The overdraft is paid back as soon as you deposit money into your account. If you do not deposit anything, the negative balance stays on your account and the bank may eventually close it or send it to collections.
Does an overdraft hurt my credit score?
A single overdraft does not appear on your credit report. However, if you do not pay back the overdraft and the bank sends your account to a collection agency, that will hurt your credit. Overdraft fees themselves do not affect your score.
What is the difference between overdraft protection and a line of credit?
Overdraft protection is automatic coverage the bank provides when you go negative. A line of credit is money you borrow and must repay with interest. Overdraft protection costs a flat fee per transaction; a line of credit costs interest based on how much you borrow and for how long.
Can I turn off overdraft protection after I turn it on?
Yes. Log into your account, go to Settings, and turn off overdraft protection anytime. Once it is off, the bank will decline transactions that exceed your balance instead of covering them.