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How to Get Overdraft Fees Refunded

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Updated May 29, 2023​

6 min. read​

Debit cards are a great resource that simplifies financial transactions. You can make purchases using available funds in your checking account instead of digging through your wallet for the exact change. Unfortunately, consumers can accidentally spend more money than they have available in their bank accounts. The bank will help make the purchase, but you will owe the difference and receive an overdraft fee. These expenses can add up, especially if you frequently operate on a low margin. You can use financial apps that provide additional resources to shield yourself from this scenario, but you may have an overdraft fee currently on your balance. What do you do then? Can you get a refund? We will discuss the details.

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How Much Are Overdraft Fees?

Most financial institutions like Bank of America and Citibank charge an overdraft fee between $33 and $35. You will pay this fee for every transaction that exceeds your limit. Consumers can get multiple overdraft fees by continuing to attempt transactions with insufficient funds, allowing them to quickly rack up if unattended. You should stop making purchases with your debit card the moment you receive an overdraft fee to avoid additional expenses. Continuing to purchase goods and services without solving the problem will put you into a deeper hole.

Banks charge their universal overdraft fee regardless of how far you go above the limit. For example, a consumer with a -$1 balance will receive the same overdraft fee as a consumer with a -$100 balance. Banks can close your account if you don’t repay the obligation, which can have dire consequences on your finances. If your account gets closed, you won’t have access to your credit card, debit card, or bank accounts. You cannot escape overdraft fees by waiting for the bank to close your account, and things can get worse if you leave a big debt unattended. The bank can send a debt collector after you to obtain the payment, and that’s never fun. You will have a steady barrage of phone calls from people demanding payment. Scammers may try to take advantage of the situation by blending in with the debt collector calls you receive. 

Banks have more patience if you are only a few dollars off and have a good history with them. Under these conditions, financial institutions understand that you are likely to repay the debt. However, mistakes happen, and if you are only a few dollars off, it’s a relatively minor one. Therefore, most financial institutions will wait 30-60 days before taking action, depending on your account’s standing. 

Can You Get Overdraft Fees Refunded?

Consumers can utilize several strategies to get their overdraft fees refunded. While these strategies aren’t guaranteed, they increase the likelihood of getting these fees wiped off your bank account.

Get Your Overdraft Fees Waived

Ask, and you may receive. You can reach out to your bank and ask them about waiving some or all of your overdraft fees. Banks are not obligated to fulfill your request, but financial institutions may remove some or all overdraft fees to build goodwill. The bank benefits if you stay with them long-term. It’s better for them to spot you the $33 to $35 overdraft fee if it means you get a mortgage or auto loan with them later down the road. These institutions prefer not to close accounts or see customers do business with another bank. 

You can contact your bank via phone or email to discuss the overdraft fee refund. Being courteous to the representative will increase your chances, but it won’t guarantee that you will get a refund. If the first representative you call won’t budge, don’t give up quite yet. You can call your bank a few hours later and speak with a different representative. Some people luck out after speaking with the second or third representative. If this is your first overdraft fee, mention it during the call to demonstrate this type of thing doesn’t happen with your finances often. Banks want to keep reliable customers, and they don’t want a small mishap to ruin a long-term relationship.

Dispute Overdraft Fees

Some overdraft fees aren’t your fault. The merchant may have overcharged or provided you with the wrong order. Those mistakes can increase the final purchase price and make your balance negative, much to your shock. You can get a refund later that puts a few dollars in your bank account, enough to return to a positive balance, excluding the overdraft fee. You can contact the bank with the dispute, and if that doesn’t work, you can reach out to the merchant. Holding onto receipts is a good practice in general, but it especially applies to getting rid of certain overdraft fees. You can use receipts and other documentation to prove the merchant’s mistake to strengthen your case. Not all merchants will fulfill your request, but if you are a returning customer, most will pay the overdraft fee to keep the relationship intact.

Auto Transfer Funds from Another Account

Some banks protect you from overdraft fees if you quickly transfer money from another account. For example, you can pull money from your savings account and replenish your checking account. Following this step within 24 hours of receiving the overdraft fee can help you get a refund. Having multiple bank accounts can save you from an overdraft fee, but creating multiple accounts also let you segment your expenses, save for taxes, and do other things with your money. So it’s a good idea to create multiple bank accounts, and it can come in handy if you overdraw one of your accounts.

Get Overdraft Refund Assistance

If the other strategies don’t work, you can consider refund assistance. Companies will negotiate with your bank on your behalf to get overdraft fees refunded. While this strategy doesn’t offer any guarantees, having someone else do the negotiating while you’re at work can lead to a swifter conclusion. Overdraft refund assistance companies also know how to negotiate effectively because they have had experience with overdraft fee conversations. If you are not the best negotiator or don’t have enough time, an overdraft refund assistance company can help.

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How to Avoid Expensive Overdraft Fees

It’s possible to get overdraft fees refunded, but avoidance is the best policy. If you never get an overdraft fee, you will never have to ask for a refund. You also won’t fall into a dangerous cycle where overdraft fees become common and eat away at your wealth. Consumers can implement these strategies to avoid expensive overdraft fees and protect their finances.

Regularly Check Your Balance

Monitoring your balance will help you avoid overspending. Daily reviews will keep your budget in perspective and make you more conscious about each purchase. Keeping your balance in mind can prevent you from going overboard and ending up with an overdraft fee. You can also monitor investments in crypto, stocks, and other assets to determine if you need to sell any to build up your emergency fund. That emergency fund can protect you from overdraft fees, but if you have enough funds in your bank account, it makes sense to invest some of those funds. 

Checking your balance also tips you off on how money leaves your account. While you will have to pay for food and housing, other expenses are unnecessary. If you have never tracked your expenses, you may discover unused subscriptions have been making a difference and triggering overdraft fees. Subscriptions also have the unfavorable element of surprise, as you may think you’re fine, but a monthly subscription payment may result in a negative balance.

Tracking how money flows out of your account and trimming costs can reduce the likelihood of overdraft fees. Overdraft fees only occur when you spend more money than you have stored in your checking account. Therefore, if you track expenses and monitor the account balance, you can avoid the root cause of overdraft fees.

Set Up Low Balance Alerts

Some banks let you set up alerts that notify you when your balance is low. These notifications can pop up on your smartphone with real-time updates. In addition, you can set predetermined amounts that trigger low balance alerts. Some consumers set up alerts for when their accounts fall below $25, $50, $100, and other amounts—seeing this notification pop up while at the mall, restaurant, grocery store, or a similar location can help you control your spending at the moment. Knowing your balance is low can save you from logging into your online banking app and seeing a negative balance.

Use a Prepaid Debit Card

Prepaid debit cards aren’t connected to bank accounts. You have to transfer money from your bank account to the prepaid debit card to fund purchases. Keeping your prepaid debit card away from your checking account can protect you from overdraft fees while giving you the same functionality as a debit card. You will have to continuously fund the prepaid debit card to continue using it, but this extra step can ensure overdraft fees never show up in your bank account.

Get Your Pay Early

Some people pay overdraft fees because the paycheck does not arrive early enough. An emergency expense arises, and some people will endure the overdraft fee for a quicker conclusion to the emergency. Getting your pay a few days early can give you enough money to cover expenses and avoid overdraft fees. Some mobile banking apps provide early paydays at 0% APR. You can get a few hundred dollars in most cases, and the incoming paycheck would then pay off the debt. It’s a far better solution than incurring an overdraft fee.

Opt for Quick Loans

Some people get payday loans and car title loans to cover small differences. These loans help you avoid overdraft fees, but you get stuck with high-interest rates. Those interest rates can put you into deeper debt and make it more difficult to avoid overdraft fees next time. This isn’t the best option for avoiding overdraft fees, but it is available if you need it.

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