How to Get Overdraft Fees Refunded

Overdraft fees can get annoying and add up in a hurry. The extra costs show up on your bank account each time you overdraw an account. For instance, if you have $50 in your checking account and make a $100 purchase, you will receive an overdraft fee. While the fees can be frustrating, it’s possible to get some of them refunded. This guide will walk you through how the fees work, the steps that can help you get a refund and how to avoid them in the first place.

What are Overdraft Fees?

Overdraft fees are costs you incur for overdrawing your balance.  You can incur overdraft fees for various transactions, such as debit card purchases or ATM withdrawals. If you recently wrote a check to someone, it can cause an overdraft fee if you do not have enough funds to cover the amount. 

Most banks charge $30 to $35 for overdraft fees. You can receive multiple overdraft fees in a given day, with some banks charging as many as 12 overdraft fees per day. You only get additional overdraft fees if you continue to overdraw your balance. For instance, if you already have a negative balance and make three separate transactions, you will receive three overdraft fees. Depending on what your bank charges, fees can range from $90 to $105.

How to Get Overdraft Fees Refunded

While it’s not a guarantee that you will get your overdraft fees refunded, it’s worth seeing what you can get. You can use these steps to potentially get overdraft fees refunded.

Step 1: Review Your Bank Statements

Checking your bank statements can help you see when the overdrafts took place. If you have incurred multiple overdraft fees, you can compile a list of dates and amounts charged. This information can speed up the refund process.

Step 2: Understand Your Bank’s Policies

Most banks outline their overdraft refund policy in their terms. You may have to submit your refund request within a certain time frame to qualify. The bank’s policies can help you determine whether you are eligible for a refund.

Step 3: Determine Valid Refund Reasons

Banks won’t refund your overdraft fees for the sake of it. You need a valid reason to request a refund for these costs. Here are some of the common refund reasons people use:

• Demonstrate you are a good customer who rarely overdraws your account
• Explain your financial situation
• Delayed deposit
• Unexpected charge
• A large automatic payment you did not anticipate

Presenting evidence to back up your reason can help you get your overdraft fees refunded.

Step 4: Contact Customer Service

It’s ideal to contact your bank’s customer service as soon as you find an overdraft fee in your bank account statement. A quicker response can increase the likelihood of receiving a refund. You can explain to customer service why you should receive a refund.

When you are talking to customer service, it’s important to remember you are speaking with a person. Being kind and courteous throughout the exchange may result in the representative encouraging their supervisor to refund the charge.

Step 5: Provide Supporting Evidence 

Providing receipts, transaction records, screenshots and any additional evidence can strengthen your case for a refund. Making the information readily accessible for the representative instead of telling them to look through your records can save them time and lead to a more pleasant exchange. You should double-check the accuracy of the evidence that you present to speed up the process and avoid complications.

Step 6: Request a Supervisor

In most cases, the representative is not in the right position to refund your overdraft fee. The representative needs to get approval from a supervisor to remove the charge from your account. You can request a supervisor if the initial customer service representative does not have the flexibility to refund your payment. Kindly asking for a supervisor and maintaining a good rapport with the representative you are speaking with can lead to a positive outcome.

Step 7: Negotiate or Advocate

Speaking with the supervisor gives you the opportunity to negotiate overdraft refunds. You should mention your history of few overdraft fees if applicable. It is also a good idea to mention your relationship with the bank if you have had an account for a few years. Don’t give up right away if the negotiations aren’t in your favor. Stay firm with your stance, and be willing to meet somewhere in the middle if necessary.

Step 8: Escalate the Issue

If the bank does not resolve your overdraft fees, you can file a formal complaint. Each bank has a complaint resource process. This escalation can lead to a resolution, but it is not guaranteed.

Step 9: Check for Regulatory Support

Some bank regulations can work in your favor if you want to get your overdraft fees refunded. The Consumer Financial Protection Bureau website outlines overdraft fee rules, including a stipulation that overdraft fees a consumer cannot reasonably expect are “likely unfair.” If you can demonstrate that you could not reasonably expect the overdraft fee, you may be able to get a refund.

Step 10: Be Patient

An overdraft fee refund won’t happen overnight. It can take several days or weeks to get the fees removed from your account. You should follow up with your bank to check on the progress and keep a record of communications.

Tips for Avoiding Overdraft Fees

While it is possible to get your overdraft fees refunded, it’s even better to avoid them in the first place. These tips can help you avoid an overdraw and keep your bank account positive.

Monitor Your Account Regularly

Checking your account multiple times each week can help you access your balance. If your bank account doesn’t have many funds left, you can look for ways to trim your expenses in the short run or get a side hustle. Keeping track of your funds and how you use them can help you avoid overdraft fees.

Sign Up for Overdraft Protection

Overdraft protection allows you to link another bank account to your checking account. For instance, if you are about to overdraw your checking account, the bank can use funds from your savings account to cover the difference. That way, you avoid the overdraft fee by receiving funds from another account. Some banks have specific requirements for people who want overdraft protection.

Opt-Out of Overdraft Services

Opting out of your bank’s overdraft services will automatically reject any transactions that would make your balance negative. For instance, if you have $100 in your checking account and you make a $200 purchase, the purchase will not go through. Some banks make it easy to opt out of overdraft services through their online platforms, but you can also contact your bank to learn how the process works.

Be Cautious with Automatic Payments

Automatic payments can help you make on-time payments for your credit card and build your portfolio. But those automated payments can leave you with a lower balance than anticipated. Monitoring automatic payments and your incoming paychecks can help you avoid a negative balance.

Avoid High-Risk Transactions

Some transactions, such as hotel bookings and car rentals, lead to account holds and temporary reductions in available funds. These types of transactions can reduce your funds more than anticipated in the short term. 

Gas holds are a common example, as many companies place a $50 hold on your account until the transaction clears. If you have $30 in your checking account and spend $20 on gas, you can still get an overdraft fee because of the $50 hold. You may want to consider an alternative payment method for these types of transactions, such as a credit card.

Make Overdraft Fees a Thing of the Past

Overdraft fees can add up, but if you have a plan in place, you can avoid them. If you received overdraft fees recently, you can try to get them refunded. You can contact your bank, explain your case and mention your good relationship with it over the years. Overdraft fees can become a thing of the past instead of recurring expenses.

Frequently Asked Questions