May 29, 2019

To understand how a Chase Bank overdraft fee works, we first need to know what an overdraft fee is. An overdraft fee occurs when you don’t have enough money in your account to cover a transaction but your bank covers the charge for you. Overdraft fees average around $34 for many banks and the same rings true for Chase. In 2017, Chase Bank made close to $2 billion from overdraft charges. It has become a major profit center for their business but a terrible option for customers. According to the CFPB, the “median frequent overdrafter” who opts into overdraft coverage spends $442 more in fees than someone who opted out. For this reason, understanding how Chase Bank overdraft policy works can help you better manage and save your money.

The basics of a Chase Bank overdraft fee

A Chase Bank overdraft fee is pretty standard, with a charge of $34 per an item that is returned or has insufficient funds. Chase won’t charge you more than three insufficient funds fees per day, which equals a total of $102. Additionally, Chase overdraft policy 24 hours states that it will not charge you a fee if your account balance at the end of a business day is overdrawn by $5 or less.

However, if your account is overdrawn for more than five consecutive business days, they will charge you a $15 extended overdraft fee, regardless of how much your account is overdrawn by.


Chase overdraft limit and practices

1. Standard Overdraft Practices

Chase will pay for an item when you don’t have enough in your checking account to cover the transaction. And they may charge you a $34 fee for it. However, Chase can also choose not to cover the transaction at their discretion. Chase bases their decision on your account history, deposits made, and transaction amount. If Chase decides not to cover your charge, your debit card transaction will not go through and you will not be charged a fee.

Chase’s Standard Overdraft Practices pays for checks, automatic payments (i.e recurring bills), and recurring debit card purchases. However, this Chase overdraft policy will NOT pay for everyday debit card transactions (i.e groceries and gas) unless you opt-in to it yourself. So read their terms carefully!

2. Chase Overdraft Protection

Chase Overdraft Protection is an optional service that allows you to link a Chase savings account as a backup to help you pay for any overdraft transactions. The amount needed to cover the transaction will be transferred from the available funds in your linked backup account.

So, what’s the catch? Although Chase states that there is no fee for an Overdraft Protection transfer, they will charge you a $5 Savings Withdrawal limit fee. This fee applies to each transfer out of your savings account over a 6 month period.  According to Chase, they will make one transfer per business day for the amount that will bring your checking account balance back to zero. If you do not have enough funds available in your backup account to bring you back from the negative, you may be charged an insufficient funds fee of $34.

How to get a Chase bank overdraft fee waived

You can request to have a Chase bank overdraft fee waived by calling them up. Call them and be polite, but firm. Ask open-ended questions like, “How can you help me with these fees?” There is a good likelihood that they will offer to refund some of your fees.