Overdraft fees are still very common. In 2024, Americans paid more than twelve billion dollars in overdraft and nonsufficient funds fees, even though some banks have reduced or removed them.
The average overdraft still costs about $35 dollars, and those fees can add up quickly any time your balance slips into the negative.
Banks such as Capital One and Citibank have removed overdraft fees on standard consumer checking accounts. Others, including Chase, still charge them in specific situations. If you bank with Chase, understanding exactly when a fee can be charged and how their overdraft rules work can protect your money.
This guide explains Chase overdraft limits, overdraft fees, overdraft protection, and simple ways to avoid paying unnecessary charges.
Chase overdraft fees at a glanceStraight from Chase’s own overdraft terms
Two ways to stop paying these fees
Chase Overdraft Policy
Chase is one of the best national banks you can bank with for your personal and business needs.
From business checking accounts with monthly fees that can be waived to offering two of the best credit cards for eighteen year olds, Chase gives its customers plenty to work with when it comes to managing finances.
You might be asking yourself, “What is an overdraft fee?” Simply put, these fees are the penalty you pay for exceeding your available balance.
Whether you choose Chase College CheckingSM, Chase Total Checking® Checking, or any one of the many other available Chase accounts, overdraft protection is an optional service.
You will have to opt in to have access to these overdraft services, but they are free to use.
When you choose to opt in for overdraft protection, Chase will link your checking and savings accounts. Should you end up with a pending transaction that will put your account into the negative, Chase will automatically cover the difference with funds from your savings account.
Other banks charge a transfer fee for this service, but Chase does not. However, if you do not have sufficient funds in your savings account to cover the overdraft, you cannot escape the overdraft fee.
Chase makes it a bit cryptic to figure out when you were charged an overdraft fee. You’ll see a memo entitled “TOT ODP CR SWP MEMO” or “TOT ODP DR SWP MEMO” on the charges list for your account if you were charged for an overdraft.
If you do not opt in for Chase’s overdraft protection, Chase will automatically reject transactions that exceed your available balance. You will not be charged overdraft fees.
Chase has the authority to grant or reject overdraft charges at will. Prior approval of a transaction does not mean the same transaction will be approved in the future.
What Overdrafts Does Chase Allow
If you need cash now and want to know what charges Chase will let go through if you need to overdraft, knowing what limits exist can help guide your decision. Here’s a quick list of the overdraft charges Chase will potentially allow:
- Personal checks
- Automatic payments made with your checking account
- Recurring debit card purchases
- Transactions initiated with your checking account number
Chase representatives probably won’t be the most forthcoming when it comes to telling you what overdrafts the bank will allow. Not only are these representatives not in a position to approve or reject any overdrafts you may incur but they also may not tell you if you’re not already a customer.
Chase may decide to pay overdraft transactions based on your previous deposits, transaction amounts, and account history. If you’ve never had an overdraft before and your account is in good standing, you’re more likely to receive the benefit of the doubt with Chase.
Chase allows overdrafts (at its discretion) for all accounts except for Chase First Checking, Chase Secure Checking, and Chase High School Checking accounts. Keep this in mind if you plan on opening an account with Chase.
Chase Overdraft Limits and Fees
Chase is known for having one of the best banking apps and offering some of the best business credit cards. If you haven’t already opened an account, check out these Chase bank promotions we highlighted in a recent article.
If it’s overdraft fees you’re worried about, Chase lays out its policy clearly. Each overdraft transaction incurs a $34 fee, with up to three separate overdraft charges allowed per day.
Chase removed its returned item fee in 2022, so if Chase does not pay a transaction and returns it unpaid, you are not charged for it. The $34 only applies when Chase covers the transaction for you.
If you need to overdraft your account, withdrawing or charging slightly more than the amount you need can help you avoid a second overdraft charge. However, you will need to balance withdrawing large amounts and the ability to pay back that balance to bring your account into good (positive) standing.
Should you overdraw your account by $50 or less at the end of the business day, Chase does not charge an overdraft fee. Chase also gives you until 11pm ET the next business day to get back to $50 overdrawn or less and still avoid the fee. Separately, no overdraft fee applies to any single transaction of $5 or less. You still need to bring the account back above $0.
The consequences of not paying back your overdrawn account balance can be serious. If you hold a negative balance for over 60 days, Chase will close your account.
If you do not repay the negative balance, Chase can send the account to a collections agency. A collections agency may report the unpaid debt to the credit bureaus. Chase will also report the closed account to ChexSystems, which can make it harder to open accounts at other banks.
Chase ATM Overdraft Limits
You cannot overdraft your account by withdrawing cash from a Chase ATM. If the withdrawal amount is more than what you have available, the request will simply be denied every time.
If you have overdraft protection and your savings account is linked with enough money in it, Chase may use your savings to cover the ATM withdrawal. This is not considered an overdraft. It is simply a transfer from savings to checking. There is no limit on the number of savings transfers Chase allows in a month, because the old six transfer rule is no longer enforced.
How to Waive Chase Overdraft Fees
There are a few different ways you can waive Chase’s overdraft fees. It’s all a matter of how much you overdraw your account as well as how quickly you repay your overdrawn balance.
If you are overdrawn by $50 or less at the end of the business day, you can avoid an overdraft fee. Chase gives you this leeway to make it easier to recover from hyper-extending your checking account.
You avoid the fee if your account is overdrawn by $50 dollars or less at the end of the business day, or you bring it back to fifty dollars or less by the next business day by 11 PM ET.
Chase Overdraft Assist
Understanding Chase Overdraft Assist is easiest with an example. Let us say that on Thursday you overdraw your account by one hundred twenty five dollars.
To avoid the overdraft fee, your account must be fifty dollars overdrawn or less by eleven o clock Eastern Time on the next business day. A payment of seventy five dollars would bring your balance to within that range and keep you from being charged the fee.
You can make this payment by visiting a local branch, depositing funds at an ATM, or using the Chase Mobile app. If you plan on visiting a branch, you must arrive before closing time.
If you do not bring the account to fifty dollars overdrawn or less by the eleven o clock Eastern Time deadline on Friday night, the thirty four dollar overdraft fee will apply.
Chase removed its returned item fee, so that charge no longer exists. Chase Private Client accounts do not pay overdraft fees. The Chase Sapphire Checking account also waives overdraft fees as long as you have only occasional overdrafts during the year.
How to Avoid Overdraft Fees
Avoiding overdraft fees can help you keep more of the money you need. In addition to opting for overdraft protection, here are a few ways you can avoid overdraft fees in general:
- Set up an emergency fund. Having a few hundred dollars saved up for a rainy day can help you out in times when you don’t have enough funds in your checking account. This fund can also help you avoid costly overdraft fees.
- Utilize your account alerts. Chase lets you set up push, email, and text notifications for many things, including low balances. Visit the Chase website or open the mobile app to set up the notifications that will work best for you.
- Get to your pay before the charge lands. EarnIn lets you take out up to $150 a day of pay you have already worked for, with no credit check and no interest, which can cover a payment before it overdraws you. To weigh the alternatives, here are cash advance apps like Dave.
Many people wait until crunch time to come up with a plan in case they need to overdraft their accounts. The best way to avoid paying overdraft fees is to be proactive in planning out what resources you have and how you can use them.
While you’re more prone to overdrafting your account if your balance is low, it’s always a good idea to have an idea of what’s available to you. Even if you have thousands of dollars in your account, you never know when an overdraft can sneak up on you.
FAQs
Chase will let you overdraft recurring debit charges, personal checks, automatic payments made with your checking account, and transactions you initiate with your checking account number. However, these transactions are all subject to approval at Chase’s discretion.
Yes, Chase offers overdraft protection, though you’ll have to opt in to receive coverage. If you don’t opt in to optional overdraft protection, Chase will reject the transactions that overdraft your account.
Chase charges $34 for overdraft transactions. You can be charged up to three times per day for overdraft transactions, for a limit of $102 per day.
No, you cannot overdraft your Chase account at an ATM. Chase will automatically reject your request, even if you have overdraft protection. Some banks allow ATM overdrafts, but Chase does not.
Not all banks charge overdraft fees, depending on the situation. For example, Capital One and Citibank do not charge overdraft fees, though you can still incur overdraft fees in certain situations.
Overdraft fees at other banks
Chase is not the only bank with a $34 habit. Here is what the others charge and how their cushions compare:
Know Your Chase Overdraft Limits and Fees
Part of researching and understanding your checking account is knowing what limits and fees exist. If you were curious about what Chase limits and fees you might be liable for, we hope this article has helped to clarify those details.
Many banks put overdraft fees and limits in place to deter customers from spending more than they have. At the same time, life doesn’t always work out so overdrafts can be a way to make ends meet.
The important thing to remember is that you can take steps to avoid overdrafts altogether. When you become more financially responsible, the money goals you’ve been working towards will become easier to achieve.
At the end of the day, it takes both successes and failures to learn how to better manage your money. With your new knowledge about Chase overdraft limits and fees, you’ll have one more tool in your arsenal.
