Under the CARD Act of 2009, for new accounts opened on or after July 1, 2010, your bank can no longer charge overdraft fees for debit and ATM transactions unless you opt-in. If you open a new account before July 1, 2010 your bank will consider you an existing customer and you will receive a notice about your bank's overdraft services.
You can grant permission by opting in to the overdraft notice your bank sends you. If you decide to opt-in you can cancel at any time. If you do not opt-in before the deadline you can opt-in in the future.
For existing accounts if you do not opt-in by August 15, 2010, your bank's standard overdraft services won't apply to your debit and ATM transactions and future transactions will be declined when you don't have enough money in your account, and you will not be charged an overdraft fee.
Currently, for standard overdraft services your bank will cover the transaction by charging a flat fee of $20-$35 each time you overdraw your account.
If you have an overdraft protection service your bank provides a line of credit that is linked to your savings account to cover transactions when you overdraw your account. Banks charge a fee each time you overdraw your account.
However, using the overdraft protection service may be less expensive than using the standard overdraft service. Keep in mind that some banks report overdrawn accounts on your credit report so it may be wise to sign up for overdraft protection.
The new ATM and debit card overdraft guidelines do not affect checks or automatic bill payments.
4 comments:
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