Overdrafting means taking more money out of your bank account than you have in your available balance. Most U.S. banks allow account holders to opt-in for such transactions, but they do charge fees if you have a negative balance, known as overdraft fees. Overdrafts commonly occur when you make a purchase that exceeds your balance, but it is also possible to overdraft at an ATM.
Below, we explain overdrafts in further detail and list the banks that allow overdrafts at an ATM. We compiled this information by contacting bank customer service departments and viewing account and overdraft protection disclosures online.
What to Know Before You Overdraft
Overdraft Amount Limits
ATMs will let you overdraft — if your account has the option to overdraft. There’s no universal limit on how much you can overdraft at an ATM. A bank’s overdraft limit depends on a variety of factors and often varies from one customer to the next. New account holders and account holders with low credit scores are usually granted a courtesy overdraft limit between $100 and $300, while customers in excellent standing can often overdraft $1,000 or more, bank representatives told us. You can ask your financial institution about your overdraft limit, but in an attempt to discourage overdrafts, the bank may not tell you what it is.
Bank overdraft fees can be high, so it’s important to educate yourself about your financial institution’s policies before choosing to overdraw your account. Fees are typically around $30 to $40 per overdrawn transaction, meaning the bank can charge several overdraft fees in one day.
Can You Overdraft With a Debit Card?
It is possible to overdraft with a debit card, both when making a purchase and when using an ATM. Your bank will set the limit on how much you can overdraw, if at all.
If you see the term “overdrawn” on your bank statement, it means you must fund your account to return it to a positive number. Otherwise, you might incur penalty fees — or even collections — from your bank. Funding your account will prevent this from happening. Contact your financial institution to discuss your options.
Can You Overdraft With a Credit Card?
It is possible to exceed your credit card limit, but credit card issuers do not usually call this an “overdraft.” Rather than overdraft fees, credit cards may charge over-limit fees. Withdrawing cash from your credit card at an ATM is usually considered a cash advance, which carries its own interest and fees.
Withdrawing cash on a credit card is expensive. Interest rates are higher than those for standard purchases — up to 25% or more. In addition to the interest your cash advance will accrue, there are almost always fees associated with these types of cash withdrawals unless you have a special offer or special rate with your card.
You may need to contact your credit card company and request pre-authorization to overdraw your card. Find out more in our research on six ways to get cash from a credit card.
How Do Overdrafts Affect Your Credit Score?
A bank account overdraft usually won’t have an impact on your credit score unless you take too long to repay the overdraft, and the bank sends your account to collections (generally after 30 days). Find out more in our research on how much you can overdraft your checking account.
Credit cards are a little trickier. Borrowing in any way, shape, or form affects your credit score. So, if you withdraw cash on a credit card, it’s recorded on your credit score. Most lenders assessing your credit score will view cash withdrawals as a red flag; they may assume you had to withdraw cash from your credit card due to financial problems. With that in mind, you should exceed your credit limit.
ATM Overdraft Policies by Bank
Although many banks do allow overdrafts at ATMs using a debit card, most of them require you to opt into this service. Even then, many banks approve or decline ATM overdrafts at their discretion.
Below, we provide the list of banks that allow overdrafting at an ATM, including their overdraft fees. These are for standard personal checking accounts. Note that teen accounts, college accounts, business accounts, and other types of accounts may have different procedures for overdrafts, including different fee amounts.
- ATM overdraft process: The bank approves or denies each overdraft transaction at its discretion unless you choose an account with no overdraft fees (meaning no approved overdraft transactions).
- Overdraft fee: $25 per overdraft with a maximum of $75 per day
Bank of America
- ATM overdraft process: Bank of America may allow you to authorize an ATM overdraft on a case-by-case basis. The agreement will show on your ATM receipt. Your consent only applies to a single withdrawal; if you attempt to overdraft by ATM again, you’ll need to provide consent again.
- Overdraft fee: $35 per overdraft if not repaid by the end of the business day
- ATM overdraft process: You must opt in to allow overdrafts with your BB&T debit card. BB&T will review each overdraft request and approve or decline it at its discretion.
- Overdraft fee: If allowed to overdraft at an ATM, you will be charged a fee each time you overdraft. Fees vary by state but are usually around $35.
- ATM overdraft process: You must opt in to allow Courtesy Overdraft Protection with your BBVA debit card. BBVA approves overdraft transactions at its discretion.
- Overdraft fee: BBVA will charge $38 ($32 in California) for each withdrawal that overdraws your account by more than $1.
- ATM overdraft process: You must opt into the Next Day Grace: Plus overdraft coverage. Once you opt in, the bank will approve ATM overdrafts at its discretion.
- Overdraft fee: $35 fee per overdraft item with a limit of four fees a day; waived if you overdraw your account by less than $5 or bring your balance back up by the end of the next business day
- ATM overdraft process: You must have overdraft protection with a linked Savings or Money Market account; some ATMs will show the total amount of your eChecking and linked overdraft protection account as your available balance.
- Overdraft fee: No fee to transfer from a linked account
- ATM overdraft process: You must enroll in Debit Card Overdraft Coverage. If you do not enroll, all overdraft attempts will be denied. Once you are enrolled, Citizens Bank will approve overdrafts at its discretion.
- Overdraft fee: $37 per overdraft item with a maximum of seven per day; waived if you overdraw your account by $5 or less
Fifth Third Bank
- ATM overdraft process: You must opt into Overdraft Coverage for ATM transactions. If you do not opt in, any ATM overdraft requests will be denied. Once you opt in, the bank will set a limit as to how much you can overdraft at an ATM. That amount is at the bank’s discretion and varies for each account.
- Overdraft fee: $37 per overdraft with a maximum of five per day; waived if you overdraw your account by $5 or less
- ATM overdraft process: You must opt into Overdraft Coverage. The bank will then approve overdrafts at its discretion.
- Overdraft fee: $36 per overdraft with a maximum of four per day
- ATM overdraft process: You must add Overdraft Coverage to your account. The bank will then approve ATM overdrafts at its discretion.
- Overdraft fee: $36 per overdrawn with a limit of six per day; waived if you bring your account balance back up by the end of the same business day
- ATM overdraft process: You must opt into TD Debit Card Advance overdraft coverage. Once opted in, the bank will consider covering an ATM overdraft, but it is not guaranteed.
- Overdraft fee: $35 per overdraft with a maximum of five per day; waived if you overdraw your balance by less than $5
- ATM overdraft process: You must opt into ATM and Debit Card Overdraft Coverage, and the bank will review and approve each overdraft attempt at its discretion.
- Overdraft fee: $36 per overdraft with a maximum of four per day
- ATM overdraft process: You must opt in to allow ATM overdrafts; however, that does not guarantee the overdrafts will be allowed. The bank will approve or deny each overdraft at its discretion.
- Overdraft fee: $35 per overdrawn item with a maximum of three fees per day
How to Avoid Overdrafts
To avoid overdrafting your bank account, you can choose not to opt-in for overdraft protection, so the bank will immediately deny any transaction that would overdraw your balance. You can also choose a form of overdraft protection that links a secondary around; you will still pay a fee, but it may be a lower fee than an unprotected overdraft. Overdraft protection covers overdrafts caused by both ATM withdrawals and other transactions, such as checks and debit card purchases.
Additionally, keep the following tips in mind to help you avoid overdrafts:
- Know your account details. Are you enrolled in overdraft protection? What fees does your bank charge for overdrafts? Consider switching to a low-fee checking account if your current bank charges high fees. (See our list of the best checking accounts.)
- Track your spending and take receipts whenever you withdraw at ATMs.
- Ask your bank if you can receive text or email notifications when your account falls below a certain amount.
- Strategically organize your monthly payments to avoid overdrawing your account. Consider setting up a budget plan.
- Build a cash reserve, so you always have extra funds available in your checking account for emergencies.
- Consider using a low-interest credit card rather than overdrawing your account if you have an immediate financial need. It may be a more cost-effective alternative to overdrawing your account, especially if you can pay it off before it begins to accrue interest.