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

When you spend more money than you have in your account, your bank covers the difference temporarily — but charges you for doing it. This is called an overdraft. The fee hits your account immediately or within one business day, making your negative balance even deeper. If you make multiple transactions while overdrawn, you can be charged multiple fees in a single day.

The exact fee amount varies by bank. Some charge a flat rate ($25 to $35 is common), while others charge a percentage of the overdraft amount. A few banks charge nothing for overdrafts, but they are rare. You can find your bank's overdraft fee in your account agreement or by calling customer service and asking directly.

Once you are overdrawn, the clock starts. Most banks give you a grace period — usually three to five business days — to bring your account back to zero before additional fees pile up. If you do not deposit money within that window, you may face a second fee for remaining overdrawn, sometimes called a sustained overdraft fee or extended overdraft fee. Some banks charge this fee daily or every few days.

Key Takeaways

  • Your bank charges an overdraft fee (typically $25 to $35) each time a transaction pushes your account below zero, and multiple transactions in one day can trigger multiple fees.
  • You usually have three to five business days to deposit money and bring your account positive before a second fee for remaining overdrawn kicks in.
  • If your account stays negative for weeks or months, your bank may close it and send your debt to a collection agency.
  • Opting out of overdraft protection stops your bank from covering transactions, but prevents overdraft fees — transactions simply decline instead.
  • Bringing your account positive as soon as possible stops additional fees and prevents your bank from closing the account.

How overdraft fees compound if you do not act quickly

The danger of overdrafts is speed. A single $2 coffee purchase that triggers a $35 overdraft fee means you are now $37 in the hole. If you make another purchase before depositing money, you get charged another $35 fee. People who are already stretched thin often find themselves charged $100 to $200 in fees within days, even though the original overspend was small.

If your account stays negative for 30 days or longer without any deposits, your bank will likely close the account. At that point, they send the debt — the negative balance plus all accumulated fees — to a collection agency. The collection agency then contacts you to demand payment. This mark stays on your banking history and can make it harder to open a new account at other banks for years.

Some banks report negative accounts to ChexSystems, a banking history database that other banks check when you apply for an account. If you are listed, many mainstream banks will deny your application. You may be forced to use a second-chance checking account, which charges higher fees and offers fewer features.

What to do if your account is already negative

Stop making purchases immediately. Every transaction while overdrawn triggers another fee. If you have a debit card, put it away. If you have automatic bill payments set up, contact those companies and pause them until your account is positive.

Deposit money as soon as you can — even a small amount helps. If you deposit $50 and your overdraft fee was $35, you are now only $15 in the hole instead of $85. Call your bank and ask if they will waive or reduce the overdraft fee as a one-time courtesy. Banks sometimes do this, especially if you have been a customer for years or if this is your first overdraft. The worst they can say is no.

If your account has been negative for weeks and fees have stacked up, contact your bank's customer service department and ask to speak with someone in the resolution or disputes team. Explain your situation honestly. Some banks will reverse one or two fees if you show you are trying to fix the problem. Document everything — the date you called, the name of the person you spoke with, and what they said they would do.

Opting out of overdraft protection to prevent future fees

You have the right to opt out of overdraft protection. This means your bank will no longer cover transactions that exceed your balance. Instead, the transaction simply declines at the point of sale or ATM. You will not be charged an overdraft fee because the bank never covers the shortfall.

The tradeoff is inconvenience: your card will be declined when you try to pay, which is embarrassing and can disrupt your day. But for people who live paycheck to paycheck, opting out prevents the fee spiral that happens when overdrafts compound.

To opt out, call your bank or log into your online account and look for overdraft settings. Some banks call it "overdraft protection," others call it "overdraft coverage." You are looking for the option to turn it off. The change usually takes effect within one business day. If you change your mind later, you can opt back in.

The difference between overdraft fees and NSF fees

Banks sometimes charge two different fees for similar situations, and the names are confusing. An overdraft fee is charged when your bank covers a transaction and your account goes negative. An NSF fee (non-sufficient funds) is charged when a transaction is declined because you do not have enough money — the bank does not cover it.

If you have opted out of overdraft protection, you will see NSF fees instead of overdraft fees. The amount is usually similar ($25 to $35), but the outcome is different: with an NSF fee, the transaction fails and the merchant does not get paid. With an overdraft fee, the transaction goes through and you owe the bank money.

Some merchants (like utilities or loan servicers) will retry a declined transaction a few days later, which can trigger multiple NSF fees. If this happens, contact the merchant and ask them to stop retrying, or update your payment method with them.

When your bank closes your account for being overdrawn

Banks are not required to keep an account open indefinitely if it stays negative. Most banks close accounts that have been overdrawn for 30 to 60 days without any deposits or payment attempts. When they close the account, they freeze it — you cannot make deposits or withdrawals.

The bank then sends your debt (the negative balance plus all fees) to a collection agency. The collection agency owns the debt and will contact you by phone, email, or mail demanding payment. If you do not pay, they can sue you in small claims court or file a judgment against you, which can affect your credit and lead to wage garnishment.

If you receive a notice that your account is being closed, contact your bank immediately. Ask if you can make a payment arrangement — even a partial deposit can show good faith and sometimes stops the closure. If the account is already closed, you can still negotiate with the collection agency to settle the debt for less than the full amount owed.

How to avoid overdrafts in the future

The simplest method is to keep a buffer in your account — money you do not spend. Even $100 or $200 acts as a cushion if an unexpected expense hits or a paycheck is delayed. This is not always possible if you are living paycheck to paycheck, but it is the most reliable way to prevent overdrafts.

Set up account alerts with your bank. Most banks let you create a notification that triggers when your balance drops below a certain amount (like $50 or $100). These alerts come via text, email, or app notification and give you time to deposit money before you go negative.

Track your spending. Use your bank's app or a simple spreadsheet to know your balance before you make a purchase. Do not rely on memory or the last balance you saw — pending transactions (like a hold on a gas pump or restaurant) can take days to post, and your available balance may be lower than your current balance.

If you are struggling to stay positive, consider switching to a bank that does not charge overdraft fees or that offers overdraft protection through a linked savings account or credit line. Some online banks and credit unions have lower or no overdraft fees. The tradeoff is usually fewer physical branches, but the fee savings can be significant.

Frequently Asked Questions

Can a bank charge me multiple overdraft fees in one day?

Yes. If you make three separate transactions while overdrawn, you can be charged three overdraft fees in a single day. Some banks cap the number of overdraft fees per day (often at four or five), but not all do. Check your account agreement or call your bank to find out their limit.

Will being overdrawn hurt my credit score?

An overdraft alone does not directly hurt your credit score because banks do not report overdrafts to credit bureaus. However, if your account is sent to a collection agency and you do not pay, that collection account will appear on your credit report and damage your score significantly.

What if I cannot pay back the overdraft?

Contact your bank and explain your situation. Some banks will work out a payment plan or reverse fees if you show you are trying. If the account goes to collections, you can negotiate with the collection agency to settle for less than the full amount. Do not ignore the debt — the longer it sits, the worse the consequences.

Does opting out of overdraft protection affect my credit?

No. Opting out is a choice you make with your bank and does not appear on your credit report. It only changes whether transactions decline or go through when you do not have enough money.

Can I get an overdraft fee reversed?

Sometimes. Call your bank and ask politely, especially if this is your first overdraft or if you have been a customer for years. Banks have discretion to reverse fees as a courtesy. Be honest about what happened and show that you are taking steps to prevent it in the future. If they say no, ask if there is a manager or resolution team you can speak with.