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How to Get Overdraft Fees Refunded

Written by Marc Guberti

Marc Guberti is a Certified Personal Finance Counselor who has been a finance freelance writer
for five years. He has covered personal finance, investing, banking, credit cards, business
financing, and other topics.
Marc’s work has appeared in US News & World Report, USA Today, Investor Place, and other
publications. He graduated from Fordham University with a finance degree and resides in
Scarsdale, New York.
When he’s not writing, Marc enjoys spending time with the family and watching movies with
them (mostly from the 1930s and 40s). Marc is an avid runner who aims to run over 100
marathons in his lifetime.

Updated April 17, 2024​

9 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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What Are Overdraft Fees and How Do They Occur?

Overdraft fees are an extra expense people incur for overdrawing their balances. This can happen with debit cards when people forget how much money is in their checking account. If you have a $50 balance in your account and spend $70, you are $20 short.

Some banks will complete the purchase and leave you with a—$20 balance. The bank will then charge an overdraft fee of roughly $35, but these bank fees vary. Some banks have been lowering their overdraft fees to attract more customers.

Other banks will decline any debit card purchases that would bring your balance below zero. While this feature can help you avoid overdraft fees, it’s inconvenient when you need to spend money on a product or a service.

A few banks let you overdraw $50-$100 before charging an overdraft fee. If you never spend more money than the amount you have available in your checking account, you will not incur any overdraft fees.

How Much Are Overdraft Fees?

Most financial institutions like Bank of America and Citibank charge overdraft fees 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 will likely 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.

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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 refund of the overdraft fee. 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 don’t want a minor 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; if that doesn’t work, you can contact the merchant. Holding onto receipts is generally a good practice, but it especially applies to getting rid of certain overdraft fees. You can use receipts and other documentation to prove the merchant’s mistake and strengthen your case. Not all merchants will fulfill your request, but most will pay the overdraft fee if you are a returning customer to keep the relationship intact.

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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 lets 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.

Are There Banks Without Overdraft Fees

Some banks and credit unions do not charge overdraft fees. These financial institutions may restrict how you can use your debit card if you are about to overdraw your balance, but you won’t end up with a fee. Other banks give you a margin of safety. For instance, you may be able to overdraw your balance by $50-$100 before you can’t use your debit card anymore. It’s more common to find banks without overdraft fees if you consider fintech companies and digital banks.

How to Avoid Expensive Overdraft Fees

It’s possible to get overdraft fees refunded, but avoidance is the best policy. You will never have to ask for a refund if you never get an overdraft fee. 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.

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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, investing some of those funds makes sense.

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.

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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. In most cases, you can get a few hundred dollars, 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 needed.

Opt-Out of Overdraft Protection

Overdraft protection isn’t as good as it sounds. This feature prevents the rejection of any purchase that exceeds your available balance. The purchase will go through, but you will see an overdraft fee on your bank statement. The good news is that you can easily turn off this feature. That way, your purchases will get rejected if the price exceeds the funds in your bank account.

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Choose a Bank Without Overdraft Fees or One Which Allows Overdrafts

Consumers have to assess many financial products along with their personal finances before choosing the right bank. Solutions for overdraft fees are important for people who get close to overdrawing their accounts and incurring fees for non-sufficient funds. If you expand your search to fintech companies, there’s a good chance you will find a service provider that doesn’t have an overdraft charge or NSF fees. No overdraft fees can go a long way in strengthening your financial outlook.

Steps on How to Get Overdraft Fees Refunded

Bank overdraft fees can be refunded if you follow the following steps.

Step 1: Review Your Account History

Review your bank account balance history and find the overdraft fees you would like to inquire about.

Step 2: Understand Your Bank’s Fee Structure

Each bank has different rules about overdraft fees and other costs like ATM fees. You can review this information in the terms and conditions to learn about your bank’s rules.

Step 3: Contact Customer Service

You can contact customer service online, by phone, or at a local branch. Make sure you have account information readily available so you can make the experience efficient and effective.

Step 4: Explain Your Situation and Highlight Your Loyalty

Banks don’t want to lose good customers. If you can demonstrate that you have normally paid bills on time and have used several of the bank’s financial products, you have a better chance of receiving a refund. You can also explain that the overdraft was a one-time event and that you are strengthening your finances to ensure it doesn’t happen again.

Step 5: Provide Evidence If Necessary

You may have to provide account statements showing when the overdraft occurred.

Step 6: Follow up with the Bank

If you don’t hear anything within a week, you should contact customer support and ask them about the status of your refund request.

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Step 7: If All Else Fails, Consider Switching Banks

You don’t have to do banking with the same financial institution for the rest of your life. If your bank isn’t treating you well, you can move your money somewhere else. Realizing your power as a consumer can make banks more eager to work with you; if not, you can find a better deal elsewhere.

Switching banks may seem like a hassle, but it can be a smart move to save money on overdraft fees in the long term. Consider looking into online banks or credit unions that may offer lower fees and better overdraft protection options. By making an informed decision, you can improve your financial stability and avoid costly fees.

If you’re tired of paying overdraft fees with your traditional bank account, give Current a try. With Current’s Overdrive feature, qualified members can get fee-free overdrafts of up to $200, giving you peace of mind and saving you money in the long run. Plus, opening a Current account comes with tons of other features, including a high-yield savings pod, budgeting tools, faster direct deposits and a mobile app to track and manage your finances.

Don’t let overdraft fees drain your finances – switch to Current today and take control of your financial experience. Open a free account on Current’s website now.

FAQs About Overdraft Fees

How many times can a bank charge an overdraft fee?

Most banks have limits but aren’t required to do so for now. Laws can limit the maximum number of overdraft fees per day in the future.

How long does it take for the bank to process a request for refunding overdraft fees?

The timing depends on the bank, but it can be resolved within a week.

Is there a limit to the amount of overdraft fees you can claim back?

There is no limit to the amount of overdraft fees you can claim back. The quicker you request a refund, the more likely you are to receive it. Being courteous to the representative will also increase your chances.

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