Chase offers overdraft protection, but you have to choose it
Chase does offer overdraft protection on most checking accounts, but it is not automatic. You have to ask for it, and Chase gives you choices about how it works. The most common option links your checking account to a savings account or credit card so that if you spend more than you have, Chase covers the difference from that linked account instead of declining your transaction or charging an overdraft fee.
Without overdraft protection turned on, Chase will decline transactions that would overdraw your account — your debit card will be rejected at the register, or your check will bounce. Some people prefer this because it stops them from going negative. Others turn on overdraft protection specifically to avoid the embarrassment of a declined card.
The catch is that overdraft protection itself is free, but using it may not be. If you link it to a savings account and Chase transfers money from savings to checking, there is no fee. If you link it to a credit card or line of credit, you pay interest on whatever amount you borrow. If you do not link it to anything and Chase covers the overdraft from its own funds, you will pay an overdraft fee — currently $35 per transaction at Chase, though this varies by account type and can change.
Key Takeaways
- Chase overdraft protection is optional and must be set up through your online account or by calling Chase; it does not turn on by itself.
- Linking overdraft protection to a savings account or money market account is free to use, though you must have funds available in that account.
- If you do not link overdraft protection to another account and Chase covers an overdraft from its own funds, you will pay a $35 overdraft fee per transaction.
- You can turn overdraft protection on or off at any time, and Chase also offers a separate "overdraft line of credit" product that works differently from standard overdraft protection.
How to turn overdraft protection on or off
You can set up or change overdraft protection through Chase's website or mobile app. Log into your account, go to the settings or account management section, and look for "overdraft protection" or "overdraft options." Chase will show you which accounts you can link to (savings, money market, or credit products) and let you choose which one you want to use.
If you want to turn it off entirely, you can do that the same way. Chase will then return to declining transactions that would overdraw your account. You can also call Chase at the number on the back of your debit card and ask a representative to set it up for you over the phone.
The difference between overdraft protection and overdraft fees
Overdraft protection is a tool you choose to prevent overdrafts from happening in the first place. Overdraft fees are what Chase charges you when an overdraft does happen — either because you did not have protection turned on, or because your protection ran out of money.
Chase charges $35 per overdraft transaction if you do not have protection linked to another account. This means if you make five transactions that overdraw your account on the same day, you could be charged $175 in fees. Some Chase accounts have a limit on how many overdraft fees you can be charged in a single day — usually two or three — but this varies by account type.
If you have overdraft protection linked to a savings account and that savings account runs out of money, Chase will then charge you the $35 overdraft fee for the transaction that cannot be covered. This is why it matters whether you keep a buffer in your linked account.
Chase overdraft line of credit versus overdraft protection
Chase offers two separate products that sound similar but work differently. Overdraft protection (described above) links your checking account to another account you already own. An overdraft line of credit is a separate credit product that Chase may offer you — it is a small credit line specifically for overdrafts, usually between $500 and $1,000.
If you have an overdraft line of credit and you overdraw your checking account, Chase automatically lends you the money from that credit line instead of charging a fee. You then pay interest on the borrowed amount, just as you would with a credit card. The interest rate and terms depend on your credit history and the specific agreement with Chase.
Not everyone is offered an overdraft line of credit, and you do not have to accept it if Chase offers. It is worth comparing: if you occasionally overdraw by small amounts, an overdraft line of credit might cost less than multiple $35 overdraft fees. If you rarely overdraw, overdraft protection linked to a savings account is usually the better choice because it costs nothing to use.
What happens if you overdraw without protection
If you do not have overdraft protection turned on and you try to spend more than you have, Chase will decline the transaction. Your debit card will be rejected, your check will bounce, or your online bill payment will fail. You will not be charged a fee for the declined transaction itself.
However, if a transaction does go through and creates an overdraft (which can happen with automatic payments or checks that clear after you thought you had enough money), Chase will charge you the $35 overdraft fee. This is why some people turn on overdraft protection — to avoid the surprise of a fee later.
Overdraft protection and your savings account
If you link overdraft protection to a savings account, Chase will transfer money from savings to checking whenever you would overdraw. This transfer is when ready and free. However, federal rules limit how many transfers you can make from a savings account per month — currently six per month, though this rule has changed in the past.
If you hit that limit and try to overdraw again, Chase cannot transfer money from savings, so you will be charged the $35 overdraft fee instead. This is rare for most people, but it can happen if you overdraw frequently. You can always turn off the link to savings and link to a different account, or turn off overdraft protection entirely.
Frequently Asked Questions
Can I have overdraft protection on multiple accounts?
Yes. If you have more than one Chase checking account, you can set up overdraft protection on each one separately. Each account can be linked to a different savings account or credit product, or they can all link to the same one — you choose.
Does Chase charge a fee just for having overdraft protection turned on?
No. Overdraft protection itself is free. You only pay if you actually use it and it pulls from a credit product (where you pay interest), or if an overdraft happens and Chase charges the $35 fee.
What if I do not have a savings account to link to?
You can link overdraft protection to a Chase credit card or line of credit instead. You will pay interest on any amount you borrow, but you do not need a separate savings account. Alternatively, you can open a Chase savings account specifically to use as your overdraft protection backup.
Can I set overdraft protection limits?
Chase does not let you set a dollar limit on overdraft protection itself, but you can turn it on or off at any time. If you want to limit overdrafts, the best approach is to keep only a small amount in your linked savings account, or to monitor your checking balance regularly.
Will overdraft protection hurt my credit score?
Using overdraft protection linked to a savings account will not affect your credit because it is not borrowing. If you use an overdraft line of credit, it may show up on your credit report as a small loan, but using it responsibly should not hurt your score.