If you’ve ever dealt with a returned check or had a debit card unexpectedly declined, you know it doesn’t take much more than a few math errors to end up in an awkward situation. Despite your best efforts to keep an accurate account balance, accidents can and will happen. Maybe your paycheck hasn’t hit your account yet, or your spouse got a tank of gas on the way to work and forgot to tell you.
Whatever the reason, having a transaction declined or returned for insufficient funds can be embarrassing, frustrating and expensive. Merchants may charge penalties of up to $200, and may even refer your bill to a collection agency. You could wind up with damage to your credit report. You could even find yourself in legal trouble. Knowingly writing a check where there is not enough money in the account to cover the promise you’ve made is a felony in most states, and you can face fines and jail time if convicted.
Abilene Teachers has a few solutions for this problem. Overdraft Transfer links your checking account to either your savings account or your personal line of credit loan and automatically transfers funds to pay the overdraft. The price is right – it’s free!
Standard Overdraft Privilege is a program that automatically covers specified overdraft transactions, up to a possible $600 for personal checking accounts. It’s our way of extending you the courtesy of covering your transaction while assuming you’ll pay them back for it later. The standard level of protection is automatically applied to your checking account unless you opt out either at account opening or by contacting us later. Standard coverage applies to paper checks and repetitive automated payments you have established, such things as gym memberships, loan payments, etc.
In addition to the categories mentioned above Extended Overdraft Privilege covers overdrafts made using your debit card at ATMs or for every day transactions. In order to use extended overdraft privilege, you must actively opt in by completing the appropriate form and returning it to the ATFCU Accounting Department.
There is a charge of $25 for each overdraft covered under either standard or extended overdraft privilege.
It’s important to note that Overdraft Privilege is not a loan, and you shouldn’t think of it as a line of credit. It’s protection against unexpectedly not having enough money in your account. You should not treat it like a credit limit on your debit card or rely on it to buy necessities. There is a per transaction fee and you are expected to pay back the amount of your overdraft plus the fee within a short period of time.
Some exceptions to this coverage may apply. If your credit history is complicated, or if you haven’t been a credit union member for long, you may not receive Standard Overdraft Privilege initially or at all in some situations. A Member Services representative will be pleased to explain the details in order to help you make the best decisions for your personal situation.