Bank of America overdraft protection lets you spend more than your balance, but the bank charges a fee each time it happens
Bank of America offers two ways to cover a shortfall: overdraft protection, which links your checking account to a savings account or credit line so transfers happen automatically, and overdraft coverage, which lets the bank pay the transaction and charge you a fee. You do not have to sign up for either one—overdraft coverage is on by default for debit card and ATM withdrawals, but you can turn it off. Overdraft protection requires you to opt in and link another account first.
The difference matters because overdraft protection moves money from your own accounts (no interest, just a possible transfer fee), while overdraft coverage is the bank lending you money at $35 per transaction. If you overdraft multiple times in one day, you can be charged multiple times—Bank of America caps overdraft fees at $105 per day, but that is still three transactions at $35 each.
Key Takeaways
- Overdraft coverage is turned on automatically for debit cards and ATM withdrawals, but you can call 1-800-432-1000 or log into your account to turn it off.
- Overdraft protection requires you to link a savings account or credit line to your checking account and must be set up before you need it.
- Bank of America charges $35 per overdraft transaction, with a daily cap of $105 (three transactions), and the fee posts within one to two business days.
- If you overdraft, you have until the end of the next business day to deposit enough to cover it and avoid the fee.
- Overdraft protection transfers are usually free if you link two of your own accounts, but some credit lines charge a small fee.
How overdraft coverage works and when the fee is charged
When you make a purchase, withdraw cash, or pay a bill and your balance is not enough to cover it, Bank of America can pay the transaction anyway if overdraft coverage is on. The transaction goes through, your balance goes negative, and the bank charges you $35. This fee posts within one to two business days, which means your balance stays negative during that time and may trigger more overdraft fees if other transactions clear.
The bank does not charge a fee for every negative balance—only for each transaction that overdrafts your account. If you are $50 short and make five purchases, you pay five $35 fees. If you are $500 short and make one purchase, you pay one fee. The daily cap of $105 means the bank will not charge more than three fees in a single day, even if more transactions overdraft you.
You have until the end of the next business day to deposit money and bring your balance positive before the fee posts. If you deposit $100 by end of business tomorrow and that covers the overdraft, the fee does not apply. If the fee has already posted, you can call 1-800-432-1000 and ask the bank to reverse one overdraft fee per year as a courtesy, though they are not required to do so.
Setting up overdraft protection to avoid fees
Overdraft protection links your checking account to another account—usually a savings account you also own at Bank of America, or a Bank of America credit line—so that when your checking account would overdraft, money transfers automatically instead. You set this up through your online account or by calling 1-800-432-1000. The bank will ask which account to link and in what order (which account to pull from first if you have multiple).
Transfers between your own Bank of America accounts are usually free, though some credit lines charge a small fee per transfer—ask before you link. The transfer happens instantly or within one business day depending on the account type. Because the money comes from your own accounts, there is no $35 overdraft fee, only the transfer fee if one applies.
Overdraft protection does not prevent overdrafts entirely. If you link a savings account with $200 and your checking account overdrafts by $500, the bank transfers the $200, your checking account is still $300 short, and overdraft coverage kicks in—you get charged $35 for the remaining overdraft. Set up overdraft protection only if you have another account with enough money to actually cover your shortfalls.
Turning off overdraft coverage if you do not want it
Overdraft coverage is on by default for debit card purchases and ATM withdrawals. You can turn it off so that transactions simply decline instead of overdrafting. To do this, log into your Bank of America account online, go to Settings, select Overdraft Coverage, and toggle it off. You can also call 1-800-432-1000 and ask the representative to disable it.
Turning off overdraft coverage means your debit card will be declined at the register if you do not have enough balance, and ATM withdrawals will fail. Some people prefer this because it stops unexpected fees, but it also means you cannot make a purchase if your balance is low. Online bill payments and checks may still overdraft even with coverage off—those are handled differently and you should check your account settings for those specifically.
You can turn overdraft coverage back on at any time using the same process. Bank of America does not charge to enable or disable it.
What happens if you repeatedly overdraft
Bank of America does not close accounts for overdrafting alone, but repeated overdrafts can trigger a review. If you overdraft more than six times in a rolling twelve-month period, the bank may contact you to discuss your account. They may suggest overdraft protection, require you to maintain a minimum balance, or in rare cases close the account if they believe you are not managing it responsibly.
Overdraft activity also appears on your ChexSystems report, which is a banking history report similar to a credit report. Other banks can see this when you apply for a new account, and some banks will deny you if you have too many overdrafts in your history. The report keeps overdraft records for five years.
If you are overdrafting regularly, overdraft protection or a higher balance buffer is cheaper than paying $35 per transaction. Some people move to a bank with no overdraft fees or a lower fee structure, though most major banks charge similar amounts.
Overdraft fees and the grace period
Bank of America charges $35 per overdraft transaction, up to $105 per day. This is one of the higher fees in the industry—some banks charge $25 to $30 per overdraft. The fee posts one to two business days after the transaction clears, which means your balance stays negative during that time.
If you notice an overdraft before the fee posts, deposit money immediately. You have until the end of the next business day to bring your balance positive and avoid the fee. For example, if a transaction overdrafts your account on Monday and posts on Tuesday, you have until the end of business Wednesday to deposit enough to cover it. After that, the fee is permanent unless you ask the bank to reverse it.
Bank of America does not automatically reverse overdraft fees, but you can request a reversal by calling 1-800-432-1000. The bank will reverse one fee per year as a courtesy if you have a good history with the account. If you have been charged multiple times, ask for a reversal on the most recent one and explain your situation—some representatives will reverse more than one if you have not asked before.
Overdraft protection versus overdraft coverage: which to use
| Feature | Overdraft Protection | Overdraft Coverage |
|---|---|---|
| How it works | Transfers money from linked account automatically | Bank lends you money and charges a fee |
| Cost | Usually free (some credit lines charge a small fee) | $35 per transaction, up to $105 per day |
| Setup required | Yes—must link account in advance | On by default, no setup needed |
| Speed | Instant or next business day | Instant, but fee posts in 1–2 days |
| Best for | People with a backup account and predictable shortfalls | Emergency one-time overdrafts only |
If you have a savings account with a cushion, overdraft protection is the better choice because it costs nothing and prevents fees. If you do not have another account to link, or you want to avoid overdrafting entirely, turn off overdraft coverage and let transactions decline. Overdraft coverage should be a last resort, not a regular way to spend money you do not have.
The choice between the two depends on your situation. People with stable income and a backup account benefit most from overdraft protection. People who want to avoid fees entirely should turn off overdraft coverage and monitor their balance closely. People who overdraft occasionally and cannot set up protection should understand the $35 fee and the grace period to minimize damage.
Frequently Asked Questions
Can I overdraft my Bank of America account multiple times in one day?
Yes, but the bank caps fees at $105 per day, which is three overdraft transactions at $35 each. If you overdraft four times in one day, you pay $105, not $140. The cap resets at midnight.
What if I link a credit line to overdraft protection instead of a savings account?
Bank of America allows you to link a credit line as your overdraft protection source. When your checking account overdrafts, the bank transfers money from the credit line instead. This counts as a cash advance on the credit line, which may have a higher interest rate and an upfront fee—check your credit line terms before linking it.
Do I get charged an overdraft fee if I use an ATM and do not have enough cash?
If overdraft coverage is on, yes—you will be charged $35 and your account will go negative. If overdraft coverage is off, the ATM will decline the withdrawal and you will not be charged. You can turn overdraft coverage off for ATM withdrawals specifically in your account settings.
How long does an overdraft stay on my ChexSystems report?
Overdraft activity stays on your ChexSystems report for five years. Other banks can see this history when you apply for a new account. Multiple overdrafts in a short time may cause other banks to deny your application.
Can Bank of America close my account if I overdraft too many times?
Bank of America can close your account if you repeatedly overdraft and do not respond to their attempts to help you manage it. The bank typically contacts you first if you overdraft more than six times in twelve months. Closing is rare, but it can happen if the bank believes the account is being misused.