So if I buy something on eBay for, say $1,000 and my available funds are just $958 (but my ledger balance is more than enough to cover it)- what happens? Does that overdraft my acct?
I'm waiting for a check that was recently deposited to clear.
2007-06-22 18:40:37 · 6 answers · asked by Elise B 1 in Business & Finance ➔ Personal Finance
I can afford to lose the ebay auction, but I do NOT want overdraft fees.
2007-06-22 18:45:00 · update #1
You have an overdraft.
If you have overdraft protection you're fine. If you don't, you'll have feeeeeeeeeeeeeees.
2007-06-22 18:44:06 · answer #1 · answered by pepper 7 · 0⤊ 0⤋
I am an accounting manager at a financial institution so I speak from experience. If your $1,000 check tries to clear before the hold is released on your deposit, it will bounce as "uncollected funds".
If you are involved in business, you must be aware of your bank's policy on clearing checks. To be safe, you should only write checks on collected funds, or your available balance.
There is always the chance that your deposit will be returned before the funds become available. That is why the bank puts the hold on in the first place. Then your checks will bounce for Non Sufficient Funds (NSF).
Either way will cost you. Your bank will charge you a fee and the company you wrote the check to will charge you a fee. Then you still have to make good on that check.
There are some services available to help with this but the will also cost you. The Courtesy Pay service will pay your check against uncollected or NSF.
CAUTION! Use this service very sparingly!
The fee your bank charges will be the same. It just saves you paying the fee to the other party. You still have to make good on the negative balance, or the bank will charge off the loss and your credit report will have a negative.
This charge off will cause you additional problems down the line when you want to buy a car or a house. You will pay higher interest rates because you are considered "high risk".
Some credit unions offer overdraft protection. This is a line of credit that will pay the negative. It is really a loan. You pay a smaller overdraft fee, plus monthly interest. If you are not careful you can go over your credit limit and still bounce checks.
My bottm line advice? Balance your check book and don't write checks against uncollected funds. You will save a lot of money and aggravation in the long run.
2007-06-22 19:00:01 · answer #2 · answered by PaxMaker 3 · 0⤊ 0⤋
Yes you will be in overdraft until the check clears since the bank will not credit your account until they get the funds.
2007-06-22 18:46:37 · answer #3 · answered by drobertsnu 2 · 0⤊ 0⤋
yes it does, which is around $35 bucks, and for every time you use your card after overdraft they will charge you another $35 For each transaction, every time you purchase anything after your overdraft even if you buy a .50 newspaper on your debit card it will cost you $35.50 trust me I know :-)
2007-06-22 18:50:02 · answer #4 · answered by yanik619 2 · 0⤊ 0⤋
probably would be an overdraft. Hope you've got protection! If you have compass you probably do.
2007-06-22 18:43:49 · answer #5 · answered by Thumbsupper! 3 · 0⤊ 0⤋
looks like it's a race!!
just hope that your recieved check clears before your payment on ebay clears!
2007-06-22 18:45:33 · answer #6 · answered by Anonymous · 0⤊ 0⤋