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Avoid Overdraft Fees

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Avoid Overdraft Fees

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What is an overdraft?

An overdraft occurs when you spend more money than you have available in your account. Upon review, Paragon Bank may choose to pay an item on your behalf. If Paragon Bank pays this item for you, it is called an overdraft. If Paragon Bank does not pay this item for you, it will be returned unpaid and called a returned item.

How can I avoid overdraft fees?

If you are currently an online banking user, an easy way to avoid overdraft fees is to use notifications and low balance alerts.

We also offer overdraft protection transfers, which link your checking account to another Paragon Bank deposit account. In the event of an overdraft, available funds will automatically be transferred from the linked account. Learn more from your relationship banker. Fees apply. 

Or you may want to apply for a Coverline overdraft protection plan.  This is a line of credit that, in the event of an overdraft, will transfer funds from your line of credit to the affected account. Subject to credit approval; applicable interest rates apply.

What is a Coverline?

A Coverline is a line of credit that, in the event of an overdraft, will transfer funds to the affected account. Coverlines are subject to credit approval and interest rates will apply.

What is Overdraft Protection?

Overdraft protection is a tool that can help you avoid overdraft and returned item fees.  Paragon Bank has several options available.

*See Question 2: “How can I avoid overdraft fees?”

How do I set up overdraft protection?

Contact your relationship banker to set up overdraft protection with a deposit account or to apply for a Coverline.

Am I automatically enrolled in overdraft protection?

No. You are not automatically enrolled in overdraft protection. You must request to have your accounts linked or you can apply for a Coverline.

Are one-time debit card transactions and ATM withdrawals automatically approved even if I don’t have available funds in my checking account?

One-time or everyday debit card transactions and ATM withdrawals are not automatically approved. Contact your relationship banker for more information.

I am overdrawn. How did this occur?

You may overdraw your account even though the available balance appears to show sufficient funds in your account. For example, the available balance does not include:

  • Outstanding checks and payments: Any checks you have written that have not yet cleared your bank account, or automatic or recurring payments that you previously authorized but have not yet been received by the bank for payment.
  • Debit card final transactions: In some cases, the bank receives a pre-authorization for a debit card transaction, but the final transaction may be more than the amount pre-authorized (for example, tips you add onto the transaction at restaurants).
  • Pending debit card transactions: Certain type of card transactions, like car rentals, hotel reservations, and international transactions may be pre-authorized, but submitted for payment much later.

After reviewing your bank statement or online activity, feel free to contact a relationship banker if you need additional assistance.

What other resources are available to help minimize overdrafts and fees?

If you are facing financial challenges, you may want to consider free or low-cost financial workshops or individualized financial counseling. Contact the National Foundation for Credit Counseling at 1-800-388-2227, or visit www.ftc.gov or www.fdic.gov for additional consumer resources. If you need additional assistance or tips, feel free to contact your relationship banker .

 

 


Disclosures:

The information provided is not intended to be legal, tax, or financial advice or recommendations for any specific individual, business, or circumstance. Paragon Bank cannot guarantee that it is accurate, up to date, or appropriate for your situation. Financial calculators are provided for illustrative purposes only. You are encouraged to consult with a qualified attorney or financial advisor to understand how the law applies to your particular circumstances or for financial information specific to your personal or business situation.