Standard Overdraft Practices

Frequently Asked Questions Regarding Overdraft Privilege   Continue to Opt-In Form


Question: What is Overdraft Privilege (ODP)?

Answer: Overdraft Privilege is a discretionary overdraft payment service that DVCU provides to the majority of our members who have a checking account. As long as you keep your checking account in good standing we grant the Privilege. Members must meet the qualification criteria as described in the Overdraft Privilege Disclosure.

Question: How is Overdraft Privilege different from our current overdraft program?

Answer:

  • We will communicate the details of our program to our Members on a regular basis.
  • Reinstate accounts after they are suspended and then returned to good standing.
  • More frequent communications when a member uses Overdraft Privilege.

Question: How does it work? How much does it cost?

Answer: We will generally pay items presented up to the total of the Overdraft Privilege limit. In addition to the items paid, our normal overdraft or return item fee of $35 will be charged for each item presented and is included in the limit. For example, if we pay two overdraft transactions, you would be charged two overdraft fees ($70). You are not charged any additional negative balance fee for having this service on their account. The fee is waived if the transaction that caused the overdraft is less than $10.

Overdraft Privilege does not cost you anything unless you use it!

Question: What is our standard Overdraft Privilege limit?

Answer: Our Overdraft Privilege limits are $500 or $1,000, depending on how long the account has been open. (31 to 181 days = $500, 182 days or more = $1,000) It is possible for accounts to have a higher negative balance if return item fees or other charges post to their account.

Question: What if I have already set up another form of overdraft protection?

Answer: If you have already established another form of overdraft protection such as a transfer from another account or Line of Credit, we will continue to look to these forms of protection first before paying the item using Overdraft Privilege. Overdraft Privilege is the “last line of defense” against a returned item.

If you have questions about other options, please contact us at (602) 375-7300 for terms and conditions.

Question: How can I apply for this benefit?

Answer: There is no application process. Members are provided this service automatically to cover overdrafts for checks, in-person withdrawals, ACH transactions, preauthorized automatic transfers and Bill Pay when they meet the eligibility requirements. Eligibility requirements are explained in the Overdraft Privilege Disclosure.

You must sign a consent form to authorize Overdraft Privilege ATM and everyday debit card transactions.

Question: When I open a new account, how long do I have to wait before my account is qualified for Overdraft Privilege?

Answer: Accounts will be qualified for Overdraft Privilege after they have been open for 31 calendar days.

Question: How do I know if I have Overdraft Privilege and what my limit is?

Answer: When you initially qualify for ODP we send an Activation Letter. The Activation Letter notifies you that you now have Overdraft Privilege on your account and describes the benefits. Also included with the Activation Letter is our Overdraft Privilege Disclosure which lists the terms and conditions, and a consent form for ATM and everyday debit card transactions.

Question: What criteria would cause me to not qualify or lose my overdraft privilege?

Answer: Overdraft Privilege may be suspended or permanently removed based on the following criteria:

  • Account is not brought to a positive balance within 30 days of becoming overdrawn
  • Account has been opened less than 31 days
  • Account type is not eligible
  • More than 10 days past due on any loan or delinquent on any other obligation to us
  • Subject to any legal or administrative orders, levy, or are currently a party in a bankruptcy proceeding
  • Have an outstanding balance on an Overdraft Repayment Plan
  • Account is being reviewed for fraudulent activity or transactions
  • Primary account owner is less than 18 years old
  • A ChexSystems or any other negative indicator has been reported to us
  • Account is classified as dormant
  • An unresolved prior loss with us
  • Accounts with invalid addresses
  • The Credit Union believes that the member is not managing their account in a responsible manner which may harm them or us

Question: How can I access Overdraft Privilege?

Answer: Overdraft Privilege can be accessed by:


✓ Checks ✓ Preauthorized Automatic Transfers
✓ ACH Transactions ✓ ATM Withdrawals*
✓ Bill Pay  
✓ Debit Card/POS Transactions*

NOTE: *Requires the member to authorize the Credit Union by completing an ATM/Debit Card Consent Form

Question: Why do I have to sign an ATM/Debit Card Consent Form?

Answer: Per Regulation E, financial institutions may not charge a fee for paying ATM and everyday debit card transactions unless you affirmatively consent or opt in to overdraft coverage for these transactions. The new rule does not apply to checks, ACH debits and recurring debit transactions creating overdrafts.

Question: How will I receive the ATM/Debit Card Consent Form?

Answer: When you open a new account, we will provide the following documents which describe Overdraft Privilege:

  • Overdraft Privilege Disclosure
  • ATM/Debit Card Consent Form (requires member signature)

Overdraft Privilege is also available to cover ATM and Debit Card transactions. This means if you make an error on your account balance or have unplanned expenses, those transactions may be covered. To ensure that you have the added benefit of protection on your ATM and debit card transactions, you will need to provide your consent.

Question: If I sign the ATM/Debit Card Consent Form, can I later decide to revoke my choice?

Answer: Yes, you may revoke your consent for overdraft coverage for ATM and Debit Card transactions at any time. You will still have Overdraft Privilege for other transaction access channels unless they choose to opt-out of the entire Overdraft Privilege Program.

Question: If I do not sign the ATM/Debit Card Consent Form, will I have Overdraft Privilege?

Answer: Yes, if you meet the eligibility criteria and choose not to sign the ATM/Debit Card Consent form you will still have Overdraft Privilege for checks, ACH transactions, recurring debit card transactions, preauthorized automatic transfers and Bill Pay.

Remember, we pay overdrafts at our discretion, which means we do not guarantee that we will always authorize and pay any type of overdraft transaction.*

Question: If I sign the ATM/Debit Card Consent Form, does that mean that I have Overdraft Privilege on my account?

Answer: No, all accounts will be reviewed periodically for eligibility as listed in the Overdraft Privilege Disclosure. If/when Overdraft Privilege is initially activated, a letter will be sent notifying you that the privilege is now available.

Question: If my Overdraft Privilege is removed, are all access channels removed?

Answer: Yes, Overdraft Privilege will not be available for any transaction types.

Question: If my Overdraft Privilege is suspended, can I get it back?

Answer: Yes. We review eligible checking accounts and reinstate Overdraft Privilege when you meet the eligibility criteria. If the member has already provided consent for ATM/Debit Card coverage, those transaction types will also be available for Overdraft Privilege.

Question: If a hold is placed on funds, could it cause the account to become overdrawn?

Answer: Yes. Funds on hold are not available to pay an item. In addition to deposit holds, you may experience debit transaction holds. When using your debit card for transactions such as rental cars or hotel deposits, the merchant may place a hold on their funds often up to 150% of the transaction amount. Since funds on hold are not accessible, this may cause you to overdraw your account.

Question: If I use my Overdraft Privilege, how long do I have to bring my account back to a positive balance?

Answer: The negative balance must be covered as soon as possible, but no later than 30 calendar days of the account becoming overdrawn. The account balance must remain positive for at least one full business day, within the thirty day period in order to keep Overdraft Privilege. All deposits to overdrawn accounts are applied to the negative balance.

Question: How do I opt-out of ODP completely, where do I get a form?

Answer: You can contact us at (602) 375-7300 or click here to opt-out or opt-in online.

Question: What correspondence will I receive if I have overdrawn my account?

Answer: We will continue to send you our regular overdraft notice for items that overdraw the account indicating that the item(s) has been paid or returned. Accounts that remain overdrawn will be sent the following reminder letters:

  • 1st Letter – 10 Days OD - Reminder that account is overdrawn and a deposit is needed
  • 2nd Letter – 20 Days OD - Letter stressing immediate action required, advising that less than 10 days remain to bring account positive
  • 3rd Letter – 30 Days OD - Notification that Overdraft Privilege has been suspended, may include a Repayment Plan
  • 4th Letter – 60 Days OD - Notification that account has been closed

Question: What if I cannot cover my overdraft balance in 30 days? Is their a Repayment Plan? To whom do I direct questions?

Answer: If you cannot cover their overdraft balance within 30 days, we may offer you an Overdraft Repayment Plan. The Overdraft Repayment Plan provides an easy way for you to repay your overdraft balance with automatic monthly debits while keeping your account open. You will not have Overdraft Privilege while in the Repayment Plan and as long as the monthly payments are made, the account will not be considered delinquent. Please contact us (602) 375-7300 and ask for the Risk Mitigation Department.

Question: If I have more than one account, do I need to opt-in for all of them?

Answer: Yes. You can list all your account numbers you wish to opt-in on the opt-in form. Deer Valley Credit Union can only pay overdrafts and assess fees on the accounts that you have listed on the opt-in form.

Question: Do all signers on my account have to opt-in?

Answer: No. Only one signer needs to opt-in and all cards attached to that specific account would be covered.

Question: Do I need to opt-in for my business account, too?

Answer: No. Your business does not need to opt-in. Only consumer account types are affected by the new regulation changes. Your service level on your business account will remain the same.

Question: What is meant by "everyday debit card transactions"?

Answer: An everyday debit card transaction is a one-time transaction using a debit card. Using a debit card to purchase groceries or gas are examples of everyday transactions. It doesn’t matter if you enter your PIN or sign for the transaction.

Question: What is the definition of a recurring debit card transaction?

Answer: A recurring debit card transaction is a preauthorized electronic fund transfer that uses a debit card number and takes place on a recurring basis. Monthly automatic bill payments for Internet, insurance or rent are examples of recurring transactions.

Deer Valley Credit Union may pay overdrafts and charge overdraft fees for any transactions that are coded as recurring transactions. We will treat any transactions that are not coded as recurring transactions as one-time transactions, even if the merchant did not properly code it.

Question: How do I prevent my accounts from becoming overdrawn?

Answer: You may monitor your account regularly with remote banking.

Through remote banking, you can also set email notifications to alert you when your account falls below a certain balance that you set. For instance, we can alert you when your balance falls below $20.

*We may refuse to pay an NSF item for you at any time, even though your account is in good standing and even though we may have previously paid NSF items for you. We have no obligation to notify you before we pay or return any item. The amount of any overdrafts including our fees that you owe us shall be due and payable immediately.

If there is an overdraft paid by us on an account with more than (1) owner on the signature card, each owner, and agent if applicable, drawing/presenting the item creating the overdraft, shall be jointly and severally liable for such overdrafts including our fees.