Your bank will charge you an overdraft fee, usually $25 to $35 per transaction that pushes you below zero

When you spend more money than you have in your checking account, your bank covers the difference—but charges you for doing it. That fee is called an overdraft fee, and it hits your account within one to three business days of the transaction that caused the overdraft. Most banks charge between $25 and $35 per overdraft, though some charge as much as $38. If multiple transactions post on the same day and several overdraft you, you can be charged multiple fees at once.

The fee itself makes your negative balance worse. If you overdraft by $5 and get charged $35, you now owe the bank $40. That larger negative balance can trigger more fees if additional transactions post before you deposit money to cover it.

Some banks offer overdraft protection, which links your checking account to a savings account or credit line. When you overdraft, the bank automatically transfers money from the linked account to cover the shortfall. This usually costs less than an overdraft fee—often $0 to $10 per transfer—but only if you have money in the linked account to transfer.

Key Takeaways

  • Overdraft fees typically range from $25 to $38 per transaction and post within one to three business days, making your negative balance larger.
  • Multiple transactions on the same day can each trigger a separate overdraft fee, even if they all overdraft you by small amounts.
  • Your bank may refuse to process new transactions once your account reaches a certain negative threshold, usually around $100 to $200.
  • Overdraft protection can prevent fees by automatically transferring money from a linked savings account, but only works if that account has funds.
  • Paying back the overdraft amount plus fees does not automatically restore your account status; you must contact your bank to request fee reversal if you have a clean history.

How long you have to pay back the overdraft

There is no single deadline. Your bank will not force you to repay the overdraft by a specific date the way a credit card company would. However, your account remains negative and unusable until you deposit enough money to cover both the overdraft amount and any fees.

During this time, your bank may continue to charge fees. If your account stays negative for more than a few days and another transaction posts, you can be charged another overdraft fee. Some banks charge a daily fee—sometimes called a "negative balance fee" or "extended overdraft fee"—for each day your account stays below zero after the first few days. This fee is separate from the overdraft fee and can add up quickly.

If you do not deposit money to cover the overdraft within 30 to 60 days, your bank may close your account and send the debt to a collection agency. The bank reports the closed account to ChexSystems, a checking account verification system that other banks use. This makes it harder to open a new checking account elsewhere for several years.

What happens to transactions while your account is negative

Once your account goes negative, your bank will usually stop processing new transactions. Debit card purchases, checks, and ACH transfers (like bill payments) will be declined. This is a protection for the bank—it prevents you from overdrafting further and owing them more money.

However, some transactions may still post and overdraft you further. Recurring charges like subscriptions, insurance premiums, or automatic bill payments sometimes go through even after your account is negative, because they are already authorized. Each one can trigger another overdraft fee.

Deposits you make will go into your account immediately, but the bank applies them to cover the overdraft and fees first. If you deposit $50 into a negative account that owes $40 in overdraft fees plus a $10 negative balance fee, the entire $50 goes to the bank, and your account is still negative.

How to recover from an overdraft

Deposit enough money to cover the full negative balance plus all fees. Once the deposit clears, your account returns to zero or positive, and you can use your debit card and write checks again. Deposits typically clear within one business day for in-person deposits at a branch or ATM, and one to three business days for mobile check deposits or transfers from another bank.

If you have a history of overdrafts, call your bank and ask them to reverse one or more of the fees as a courtesy. Banks have discretion to waive fees for customers with otherwise clean records. Be specific: explain that you overdrafted, acknowledge the mistake, and ask if they can remove the fee. Some banks will reverse one fee per year; others will do it once if you ask. Do not expect reversal if you have multiple overdrafts in a short period.

If your bank refuses to reverse fees and you believe the overdraft was caused by an error on the bank's part—such as a delayed deposit posting or a transaction posting out of order—file a dispute. Contact your bank's customer service and ask to file a claim. The bank will investigate, and if they find an error, they must reverse the fees and any resulting overdraft charges.

Overdraft protection versus opting out

When you open a checking account, your bank may automatically enroll you in overdraft protection for debit card and ATM transactions. This means the bank will cover the transaction and charge you a fee rather than declining it. You have the right to opt out of overdraft protection for debit and ATM transactions at any time by contacting your bank in writing, by phone, or through your online account.

If you opt out, your debit card and ATM withdrawals will be declined if you do not have enough money in your account. This prevents overdraft fees but can be embarrassing at checkout. Checks and ACH transactions (bill payments, transfers) are not covered by overdraft protection rules and will still overdraft you and trigger fees even if you opt out of debit card protection.

Overdraft protection linked to a savings account or credit line is different. You must request this service, and it only works if the linked account has money in it. If your savings account is empty, the transfer will not happen, and you will still overdraft and be charged a fee.

Overdraft fees and your credit score

A single overdraft does not directly damage your credit score. Credit bureaus do not see overdraft fees—they only see accounts that are sent to collections. However, if you do not pay back the overdraft and your bank closes your account and sends the debt to a collection agency, that collection account will appear on your credit report and lower your score significantly.

Overdrafts also appear on ChexSystems, the checking account verification system. When you apply for a new checking account, most banks check ChexSystems. If you have unpaid overdrafts or closed accounts from overdrafts, banks may deny your application or require you to pay the old debt first. Some banks specialize in second-chance checking for people with ChexSystems records, but they often charge higher fees.

The longer an overdraft sits unpaid, the more likely it is to be sent to collections. Once in collections, it becomes much harder to repair—the collection agency may sue you, garnish your wages, or place a lien on your property depending on your state's laws.

How to avoid overdrafting in the future

Set up account alerts through your bank's app or website. Most banks let you create a low-balance alert that notifies you by text or email when your account drops below a certain amount—usually $100 or $200. This gives you time to deposit money before you overdraft.

Keep a buffer in your account. Aim to never let your balance drop below $100 to $200, depending on how often you make transactions. This cushion prevents small mistakes or timing issues from triggering overdrafts.

Link a savings account to your checking account for overdraft protection. If you have money in savings, the bank will transfer it automatically when you overdraft, usually for a $0 to $10 fee instead of a $25 to $35 overdraft fee. This only works if your savings account actually has money in it.

Track your spending in real time. Check your account balance before making large purchases or paying bills. Many banks update their app balance instantly for debit card transactions, so you can see your current balance before you swipe.

Frequently Asked Questions

Can a bank close my account for overdrafting?

Yes. If your account stays negative for 30 to 60 days without a deposit, or if you overdraft repeatedly, your bank can close your account without notice. Once closed, the bank may send the unpaid balance to a collection agency. The closed account stays on your ChexSystems record for five to seven years, making it difficult to open a new checking account elsewhere.

What if I overdraft and then deposit money—do I still owe the fees?

Yes. Overdraft fees are separate from the amount you overdrafted. If you overdraft by $10 and are charged a $35 fee, you owe the bank $45 total. Depositing $10 covers only the overdraft; the $35 fee remains owed. You can ask your bank to reverse the fee if you have a clean history, but they are not required to.

Do overdraft fees show up on my credit report?

No, a single overdraft fee does not appear on your credit report. However, if the overdraft goes unpaid and is sent to a collection agency, the collection account will appear on your credit report and damage your score. Overdrafts also appear on ChexSystems, which banks check when you apply for a new account.

Can I dispute an overdraft fee if I think it was the bank's mistake?

Yes. If you believe the bank made an error—such as posting a deposit late or processing transactions out of order—contact your bank and file a dispute claim. The bank will investigate, and if they find an error on their end, they must reverse the fees and any overdraft charges that resulted from that error.

What is the difference between overdraft protection and opting out?

Overdraft protection means the bank covers debit card and ATM transactions even if you do not have enough money, then charges you a fee. Opting out means those transactions will be declined instead. You can opt out at any time by contacting your bank. Checks and bill payments will still overdraft you regardless of whether you opt out of debit card protection.