Overdraft Coverage Options: Overdraft Privilege and Overdraft Protection

Home / Overdraft Coverage Options: Overdraft Privilege and Overdraft Protection

Life happens! We understand that unexpected overdrafts occur from time to time – Overdraft Coverage can help.

Overdraft Coverage Options

The choice is yours. Consider these ways to cover overdrafts:

Service Cost
Overdraft Privilege1 $30 per item
Overdraft Protection Link to Another Deposit Account you have at Leominster Credit Union2 $0 fee per transfer (subject to Regulation D limitations)
Overdraft Protection Line of Credit3 Subject to fees + interest

1Contact us at 800-649-4646, ODPadmin@leominstercu.com, or come by a branch to sign up or apply for these services. 2 In accordance with Regulation D, savings accounts may not exceed six convenient transactions per statement cycle. If you exceed six convenient transactions per statement cycle, you will incur a $10 fee per item. Please refer to our separate fee schedule for additional information about charges; 3subject to credit approval.

Overdraft Protection applies to all types of transactions and may help protect your account from being overdrawn by automatically transferring funds to your checking account from another account or line of credit you may have at Leominster Credit Union, for a fee and/or finance charge. Please note that overdraft lines of credit are subject to credit approval.

Overdraft Privilege is a discretionary service that allows you to overdraw your account up to the disclosed limit for a fee to pay a transaction. Leominster Credit Union may provide you a specific Overdraft Privilege limit depending on the type of account you have. Not all accounts will meet the eligibility criteria for Overdraft Privilege. Even if you have Overdraft Protection, such as a transfer from another account, Overdraft Privilege is still available as secondary coverage if the other protection sources are exhausted. Please be aware that the Overdraft Privilege amount is not included in your available balance displayed through internet banking, mobile banking, telephone banking, or Leominster Credit Union ATMs.

Transactions Covered with Overdraft Privilege Standard Coverage
(No action required)		 Extended Coverage
(Your consent required on consumer accounts) *
Checks X X
ACH – Automatic Debits X X
Recurring Debit Card Payments X X
Online Bill Pay Items X X
Internet Banking Transfers X X
Telephone Banking X X
Teller Window Transactions X X
ATM Withdrawals X*
Everyday Debit Card Transactions X*

If you want us to authorize and pay overdrafts caused by ATM and everyday debit card transactions (Extended Coverage), tell us by using one of the methods below.

  • call us at (800) 649-4646
  • complete the online consent form by clicking here,
  • visit any branch,
  • complete a consent form and mail it to us at 20 Adams St., Leominster, MA 01453 or
  • e-mail us at ODPadmin@leominstercu.com. Please note, E-mail may not be a secure method of communication. Please do not send confidential personal or financial information by E-mail.

*If you choose Extended Coverage, all the transaction types listed in Standard Coverage are included, along with ATM transactions and everyday debit card transactions. Leominster Credit Union will not authorize overdrafts for everyday debit card and ATM transactions on consumer accounts unless you give us your consent to pay these overdrafts by electing Extended Coverage. Business accounts automatically have Overdraft Privilege Extended Coverage.

NOTE: Business accounts automatically have access to Overdraft Privilege for ATM and everyday debit card transactions (Extended Coverage).

You can discontinue the Overdraft Privilege in its entirety by contacting us at (800) 649-4646, sending us an e-mail at ODPadmin@leominstercu.com, or by clicking here. Please note, E-mail may not be a secure method of communication. Please do not send confidential personal or financial information by E-mail.  Without Overdraft Privilege, your insufficient funds items will be returned to the payee and/or declined at the point of purchase, unless you have Overdraft Protection available to cover the item(s). You will be charged the standard Insufficient Funds Fee of $30 for all returned items.

How Much Does Overdraft Privilege Cost?

When Overdraft Privilege is used, the Overdraft Fee of $30 will be imposed for overdrafts created by checks, ACH, point-of-sale, ATM transactions, in-person withdrawals, or by other electronic means. If multiple items overdraw your account on the same day, each item will be assessed the appropriate fee. This is the same fee that Leominster Credit Union charges for items returned to the payee due to insufficient funds.

If an item is returned because the available balance in your account is not sufficient to cover the item and the item is presented for payment again, Leominster Credit Union will charge a return item fee each time it returns the item because it exceeds the available balance in your account. If, on representment of the item, the available balance in your account is sufficient to cover the item Leominster Credit Union may pay the item, and, if payment causes an overdraft, charge an overdraft fee.

The maximum amount of Overdraft Fees that we will charge to your consumer account is $180 per day. These exceptions apply to business accounts and consumer accounts.

All fees and charges will be included as part of the Overdraft Privilege limit amount. Your account may become overdrawn in excess of the Overdraft Privilege limit amount as a result of the assessment of a fee. The total negative balance, including all fees and charges, is due and payable upon demand. Depositor and each Authorized Signatory will continue to be liable, jointly and severally, for all such amounts, as described in the Important Information for Our Members disclosure.

What Else You Should Know 

  • We generally post items in the following order: 1) deposits (credits), 2) withdrawals (debits), in the order in which they are received by the Credit Union on the day they are processed, regardless of type of deposit or withdrawal and dollar amount. However, because of the many ways we allow you to access your account, the posting order of individual items may differ from these general policies. Holds on funds (described below) and the order in which transactions are posted may impact the total amount of Overdraft Fees or Insufficient Funds assessed.
  • A single larger overdraft will result in just one fee, as opposed to multiple smaller overdrafts.
  • Although under payment system rules, Leominster Credit Union may be obligated to pay some unauthorized debit card transactions, Leominster Credit Union will not authorize debit card or ATM transactions unless your account’s available balance (including overdraft coverage options) is sufficient to cover the transactions and the amount of any fee(s).
  • Giving us your consent to pay everyday debit card and ATM overdrafts on your consumer account (Extended Coverage) may result in you incurring Overdraft Fees for transactions that we would otherwise be required to pay without assessing an Overdraft Fee. However, this would allow us to authorize transactions up to the amount of your Overdraft Privilege limit and may also help you avoid overdrafts in excess of your available balance that could result in suspension of your debit card. If you consent to Extended Coverage on your consumer account, it will remain on your account until it is otherwise withdrawn.
  • Leominster Credit Union authorizes and pays transactions using the available balance in your account. Leominster Credit Union may place a hold on deposited funds in accordance with our Important Information for Our Members disclosure, which will reduce the amount in your available balance. The available balance for checks, ACH items, and recurring debit card transactions is comprised of the ledger balance, less any holds on deposited funds and any debit card holds, plus the amount of the Overdraft Privilege limit and any available Overdraft Protection. The available balance for ATM and everyday debit card transactions on accounts with Standard Coverage is the ledger balance, less any holds on deposited funds and any debit card holds, plus any available Overdraft Protection, but does NOT include the Overdraft Privilege limit. For accounts with Extended Coverage, the Overdraft Privilege limit is included in the available balance for authorizing ATM and everyday debit card transactions.
  • Leominster Credit Union will place a hold on your account for any authorized debit card transaction until the transaction settles (usually within two business days) or as permitted by payment system rules. In some cases, the hold may exceed the amount of the transaction. When the hold ends, the funds will be added to the available balance in your account. If your account is overdrawn after the held funds are added to the available balance and the transaction is posted to the available balance, an Overdraft Fee may be assessed.
  • Except as described in this brochure, Leominster Credit Union will not pay items if the available balance in your account (including the Overdraft Privilege limit, if applicable) is not sufficient to cover the item(s) and the amount of any fee(s).
  • We may suspend your debit card use if you incur overdrafts in excess of the available balance in your account including any Overdraft Privilege limit (as described in this brochure). Debit cards on your account will remain suspended until you make sufficient deposits so that your available balance, taking into account any Overdraft Privilege limit, is positive and then you contact us.
  • Leominster Credit Union may also suspend your debit card if your account is overdrawn more than 32 consecutive calendar days. Debit cards on your account will remain suspended until you make sufficient deposits so that your account balance is positive.
  • Leominster Credit Union may also suspend your debit card if we are unable to contact you due to an incorrect mailing address or phone number(s). You must contact us with your correct mailing address and/or phone number(s) to have your debit card reinstated.
  • If your debit card(s) is suspended, you will be unable to use your debit card(s) for purchases or to access your accounts associated with your debit card(s) at the ATM for balance inquiries, deposits, or withdrawals while your debit card is suspended. If you use your debit card for recurring payments, e.g., utilities, you are responsible to make other arrangements for your recurring debit payment(s).
  • Overdraft Privilege is not a line of credit; it is a discretionary overdraft service that can be withdrawn at any time without prior notice.
  • Overdraft Privilege may be reduced to $5.00 if you default on any loan or other obligation to us, your account becomes subject to any legal or administrative order or levy, or if you fail to maintain your account in good standing by not bringing your account to a positive balance within 32 days for a minimum of one business day. You must bring your account balance positive for at least one business day to have the full Overdraft Privilege limit reinstated.

Overdraft Protection and Overdraft Privilege Summary

  • Overdraft Protection services allow you to link other sources you have with Leominster Credit Union to your checking account to prevent overdrafts and may be less expensive options than an overdraft.
  • Overdraft Privilege allows you to overdraw your account for a fee of $30 to pay a transaction.
  • An Overdraft Privilege limit is available for eligible accounts at account opening. Business Checking accounts will have an Overdraft Privilege limit of $1,500, Rewards Checking accounts will have an Overdraft Privilege limit of $1,000 and all other Personal Checking accounts will have a limit of $800.
  • Overdraft Privilege Standard Coverage covers checks, ACH transactions (automatic debits), online bill items, teller window transactions, telephone and internet banking transactions, and recurring debit card transactions (automatic/pre-authorized debits that you establish (insurance premiums, utility bills, etc.)).
  • Overdraft Privilege Extended Coverage covers ATM transactions and everyday debit card transactions on your personal accounts with your prior consent, in addition to those transactions covered by Overdraft Privilege Standard Coverage. Business accounts automatically have Overdraft Privilege Extended Coverage.
  • Both Overdraft Protection and Overdraft Privilege may enable you to avoid expensive merchant returned-check charges.
  • Both Overdraft Protection and Overdraft Privilege may enable you to avoid having your ATM or debit card transactions declined due to insufficient funds.
  • You must deposit the full amount of the overdraft within 32 consecutive calendar days, including any fees assessed, and maintain a positive balance for at least one business day to continue to receive the full Overdraft Privilege limit.
  • Good account management is the best way to avoid overdrafts. Use our mobile banking, internet banking, or telephone banking services to help keep track of your balance.
  • For additional financial education resources, please visit www.mymoney.gov, or our website at www.leominstercu.com.

If you have questions about Overdraft Protection or Overdraft Privilege, please call us at 800-649-4646.