Monitoring the Account

• Bank customers should monitor their accounts every day, preferably in the morning. Most banks have online banking available, and for checking accounts this will be the most convenient method of verifying balances, charges, deposits and withdrawals. If a computer is not available to you, ask the bank for a toll-free number that will allow you to check the balance and any transactions.
  
  

Pending Transactions

• When an overdraft occurs, the bank makes a pending charge to the account for either covering the overdraft and moving the account to a negative balance, moving money from a linked account to cover the overdraft or returning the check to the payee. The charge will be pending until the close of business on the day the charge is posted, or at the close of business on Monday, if it occurs on a weekend.
  
  

Reversing the Charge

• The bank will be more willing to reverse the overdraft charges while they are still pending. Call the bank as soon as you discover the charge, explain the circumstances, ask to have the fee waived and offer to cover the outstanding amount immediately, either by depositing money in the account or transferring it to another account. If multiple overdraft charges appear, the bank may compromise and remove one or several, but not all. This is a common circumstance when a debit card is used while the customer is unaware the account has moved into negative territory.
  
  

Opting Out

• In the summer of 2010, a new federal law took effect concerning the handling of overdrawn accounts by retail banks. At the customer's discretion, the bank can either allow the use of debit cards when an account is overdrawn (including all pending charges) or have the card declined by the retailer when the customer tries to use it. The latter option, in theory, will prevent multiple overdraft charges on a single day when the debit card is used on an overdrawn account or on one with an insufficient balance.
  
  

Linking Accounts

• The bank may also waive the fee if you agree to link another checking or savings account to the overdrawn account or agree to set up a line of credit on the account. The link will draw money from the other accounts if necessary (a one-time charge is incurred); the line of credit will automatically extend an interest-bearing, nonsecured cash loan into the account, for which you must make minimum monthly repayments.
  
  

Considerations

• Smaller local banks are generally more willing to waive fees and bend the rules for customers they know. Larger banks are less flexible, and managers are held to strict procedures regarding overdraft fees and the handling of checking accounts. No matter what kind of bank you're dealing with, when using a debit card drawing on a checking account, some form of overdraft protection is essential.