When you open a new checking account with a bank, your customer service representative should explain the bank's overdraft policy and ask if you would like to enroll in overdraft protection. By opting for overdraft protection, the bank will cover you for transactions that would normally not go through as a result of insufficient funds. 

This will allow you to still complete the transaction, but will put your account in a negative balance until a deposit is made to return your account balance to positive status. The bank will also charge you an overdraft fee to compensate for the overdraft protection service. Unfortunately, to return your balance to positive, you must not only deposit the amount you overdrew your account on, but also the overdraft fee.

In light of recent legislature, banks now require that you "opt-in" for overdraft coverage. This is because many banks were deceptive, even negligent, in informing their customers of how they posted transactions and assessed overdraft fees. Customers were told debit purchases were "deducted from (their) account instantly" meaning transactions should post in chronological order.

Many customers who were assessed unfair overdraft fees found that their bank statements showed higher value transactions posting first, causing their account to overdraft more rapidly with the smaller transactions that followed. This practice of high-to-low transaction posting caused bank customers to incur multiple overdraft fees when they should not have.

It is important to understand the basics of overdraft fees as well as your bank's practices in offering overdraft protection. If you are an existing customer, the new legislation requires you to personally request overdraft protection from your bank. You should keep a careful eye on your accounts to make sure that your transactions are posting properly and in a fair manner. 

If you have been wronged, then you need to have a strong advocate in your corner. A Louisville class action lawyer can help you join a current class-action lawsuit, or help establish a new claim on your behalf.  As your attorneys, Gray and White Law will use their knowledge of class action litigation to build your case, no matter the size or scope. Their experienced team will fight for the compensation you deserve by seeking out others who have been similarly victimized. Contact us today to schedule an evaluation of your case - 1-888-450-4456.

Matthew L. White
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Founder & Partner of Louisville Personal Injury Law Firm Gray & White Law
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