2006-07-15 06:00:17 · 5 answers · asked by crazycoreen 1 in Business & Finance ➔ Personal Finance
If you have set up overdraft proctection with your bank, it will likely be one of two things:
1) the bank will automatically transfer money from your savings account to cover the overdraft. There is a flat fee involved.
2) the bank covers the overdraft for you, and in essense you have taken out a loan. Interest is charge for the amount you owe the bank, and the amount of time it takes you to put money into the account to pay back the bank.
2006-07-15 06:05:08 · answer #1 · answered by Anonymous · 1⤊ 0⤋
Overdraft protection is available in case you overdraw your account. They will honor the item up to the limit of your protection, but most banks will also charge you the "bounced" check fee for using it. You should NOT try to use is as a credit card, if that's what you're thinking.
2006-07-15 13:07:39 · answer #2 · answered by misslabeled 7 · 0⤊ 0⤋
"Cat"'s answer is correct one for the U.S. In other countries you can have an interest-free overdraft protection up to some limit. I have an account like that in France and almost always have it in the red.
2006-07-15 13:08:35 · answer #3 · answered by hec 5 · 0⤊ 0⤋
You might want to ask your bank officials that question because I'm really not sure.
2006-07-15 13:03:08 · answer #4 · answered by Ladybug1986 2 · 0⤊ 0⤋
Bounce a check...then they tap into that money to pay it.
It's not real money...its the amount they allow you to borrow. You have to pay it back, but it prevents you from bouncing checks.
2006-07-15 13:03:20 · answer #5 · answered by Anonymous · 0⤊ 0⤋