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Overdraft Solutions FAQs

Find the answer to your overdraft questions here.

What is an overdraft?

An overdraft occurs when you do not have a sufficient available balance in your account to cover a transaction, but we pay it anyway. This happens when you spend more on a purchase, payment, or withdrawal than you have available funds in that account.

How is my available balance determined?

Your available balance is the amount of money in your account that is available to use. Simple enough, right?

Determining your available balance begins with your current balance. So, let’s define that: Your current balance reflects the full amount of all deposits and payment transactions that have posted to your account.

Your available balance is your current balance less: (1) holds placed on deposits, (2) holds on debit card transactions or other transactions that have been authorized but have not yet been posted or settled, and (3) any other holds.

Your available balance will not reflect any outstanding checks you have written or automatic payments that have not been presented for payment.

Because of the continuous flow of checks and transactions being presented for payment, your available balance is constantly changing.

What are holds?

When you make a debit transaction, a hold is placed on your account when the transaction is presented for payment and is removed after four days or when we receive notice to pay the transaction, whichever happens first. As we mentioned in the question about available balances above, the amount of the hold is subtracted from your current balance and is reflected in your available balance, even though the money hasn’t actually left your account yet.

It is also important to know that a hold may not reflect the final amount of the transaction, usually for gas or tips. (Check out Scenario #3 on our Overdraft Scenarios page.)

Why are some of my debit card transactions not reflected in my available balance?

While most debit card transactions post within four processing days of the authorization, merchants have up to 180 days to present a pre-authorized debit card transaction for payment.

What are the differences among NSF, Courtesy Pay, and Overdraft Protection?

A Non-Sufficient Funds (NSF) Fee results when a transaction like a check, an automatic payment, or a recurring debit card transaction is returned. This occurs when your discretionary limit is exceeded.

The fee for an NSF is $30, which is the same as a Courtesy Pay fee, but you may face additional consequences from the person or business you were trying to pay – like a returned payment fee, a late fee, service disruptions or cancellations, and even credit ramifications.

If an overdraft solution like Courtesy Pay or Overdraft Protection is utilized, the transaction will be paid, and, depending on your overdraft solution and the amount of your overdraft, you may be charged a fee or face interest charges in addition to having to pay us back on the funds we advanced your account.

Am I automatically covered by an Overdraft Solution?

Our standard Courtesy Pay practices are automatic with all Avadian checking accounts, up to their discretionary limits. Under our standard Courtesy Pay practices, we will authorize and cover checks, automatic bill payments, and recurring debit card transactions. You must provide authorization for expanded Courtesy Pay practices before we will authorize and cover ATM withdrawals and everyday debit card transactions. (See next question to learn how to authorize expanded Courtesy Pay practices.)

You must enroll in Overdraft Protection to link an eligible account or personal line of credit to your checking account.

Can I change my Courtesy Pay authorization?

Of course. You, any joint owner, or agent may change your Courtesy Pay authorization at any time by using online banking or the Avadian app and selecting “Account Actions” then “Overdraft Coverage,” calling 1.888.AVADIAN (1.888.282.3426), or visiting the nearest branch.

Are all accounts eligible for Overdraft Solutions?

Most, but not all.

The following are eligible for Overdraft Solutions:

  • Choice Checking
  • Choice Checking With Interest
  • e-Checking
  • Business Choice Checking
  • Business Choice Checking With Interest

The following are not eligible for Overdraft Solutions:

  • Health Savings
  • Money Market
  • Premium Money Market

How is my discretionary limit determined?

Qualified accounts may be eligible for a discretionary limit based on the account history and standing of the account.

What are the fees associated with Courtesy Pay?

A fee of $30 may be charged for each transaction we cover through Courtesy Pay. Whether you are assessed a fee is determined by your available balance after we cover your transaction. 

You pay no fee when the transaction results in your account’s available balance being overdrawn between $.01 and $10.00.

You pay a $30 fee when the transaction results in your account’s available balance being overdrawn in excess of $10.00.

You may be charged multiple fees on a single transaction if the transaction is re-presented for payment, and you still do not have sufficient funds in your account.

Is Courtesy Pay the same as Overdraft Protection?

No. Courtesy Pay is a service in which we pay overdrafts at our discretion. We do not guarantee that we will always authorize and pay any type of transaction. If we do not authorize and pay an overdraft, your transaction will be declined. You may incur a Courtesy Pay fee if we pay an overdraft.

What are the fees associated with Overdraft Protection?

You pay a $5 fee per day when the transfer is made from a savings account.

Transfers from a personal line of credit are not assessed a transfer fee. You will, however, be charged interest on the money transferred based on the terms of your personal line of credit.

Is there a limit to the number of times per day or the amount of funds that Overdraft Protection will transfer funds?

The only limit is the available funds in the linked account or line of credit.

What can I do to avoid overdraft fees?

The most important thing to do to avoid overdraft fees is to avoid overdrawing your account. And here are some tips that will help you do just that.

Track your daily spending.

Rather than waiting to think about your account balance until you are on the verge of making a purchase or setting up a payment, stay on top of your balance by tracking your spending using your check register, through an app, or with other online banking tools.

By regularly checking your account balance, viewing recent transactions, and monitoring scheduled payments, you can make informed decisions about how much you can spend.

Keep sufficient funds in your account by taking advantage of direct deposit or automatic transfers.

“Keep sufficient funds in your account” may seem like obvious advice, but there’s more to it than that. The reality is, it’s easy to forget to transfer money from one account to the other if you have multiple accounts, especially at multiple financial institutions.

If your employer offers direct deposit, consider enrolling so you have a steady flow of funds into your account. Set up automatic transfers if you need to move from one account to another.

Tracking your spending and having a budget will help you anticipate how much you need to keep in your account at a given time. It will also help you know how much you can move to savings.

Set up alerts or notifications.

As an Avadian member, you have the opportunity to set up text or email alerts and even push notifications that will alert you if your checking account drops below a certain amount. These warnings will give you a chance to transfer funds before you overdraw your account.

Beyond those ways to avoid overdrawing your account, there are a few other things you can do to avoid overdraft fees.

Enroll in Overdraft Protection

Avadian offers a service called Overdraft Protection that allows you to link your checking account to a secondary account or a personal line of credit. With Overdraft Protection, funds are automatically transferred to your account to protect you from overdrawing your account.

You can read more about the advantages and disadvantages of Overdraft Protection above.

Consider NOT authorizing expanded Courtesy Pay practices.

Expanded Courtesy Pay coverage may not be for everyone. If you are concerned that you will incur more fees than you can afford, decline expanded Courtesy Pay practices. Just keep in mind that if you decline expanded Courtesy Pay practices, you may have to deal with a declined debit card transaction for an everyday one-time debit card purchase or ATM withdrawal if you do not have sufficient funds. If you want to change your authorization for expanded Courtesy Pay coverage, check out our next question.

If there are multiple owners on my checking account, does everyone need to authorize coverage of ATM withdrawals and everyday debit card transactions?

No. Authorization of expanded Courtesy Pay practices for ATM withdrawals and everyday debit card transactions may be granted or revoked by any of the co-owners of the checking account.

Can I utilize Courtesy Pay if I enroll in Overdraft Protection?

Yes. Overdraft Protection links your checking account to another eligible Avadian account so you can use available funds in the other account to cover overdrafts in your checking account. If there are not enough available funds in your secondary account, Avadian uses Courtesy Pay to authorize and pay overdrafts, up to your discretionary limit for checks, automatic bill payments, and recurring debit card transactions. You may also authorize expanded Courtesy Pay practices to cover ATM withdrawals and everyday debit card transactions.

Can my checking account have Overdraft Protection from multiple accounts?

Yes, you can link multiple eligible accounts to your checking account as a means of Overdraft Protection.

If I have multiple accounts, does my authorization to cover ATM withdrawals and everyday debit card transactions apply to all my accounts?

No, you must authorize expanded Courtesy Pay practices for each account separately.

Can business accounts utilize Overdraft Solutions?

Yes. Unlike with personal accounts, expanded Courtesy Pay practices covering ATM withdrawals and everyday debit card transactions are automatic for business accounts. If you do not want expanded Courtesy Pay practices to be utilized on your business account, you must change that selection.

If you are a sole proprietor, you may change that selection by using online or mobile banking and selecting “Account Actions” then “Overdraft Coverage,” calling 1.888.AVADIAN (1.888.282.3426), or visiting a branch. If your business structure is different, you will need to call 1.888.AVADIAN (1.888.282.3426) or visit a branch to change your Overdraft Authorization status.

Overdraft Protection is also available for Business checking accounts by linking to Business Savings or Business Money Market accounts or to a commercial line of credit with the same name as the Business Checking.

You may not use personal accounts to protect business accounts, and you may not use business accounts to protect personal accounts.


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