State Employees Federal Credit Union (SEFCU) can issue you an overdraft fee when you don’t have enough money in your account to complete a transaction but the credit union pays for the transaction anyway. By covering the transaction, SEFCU allows your account balance to go negative, but will charge you a fee for it.
Transactions that can trigger an overdraft item fee include:
SEFCU can cover other types of overdraft transactions, including ATM transactions and one-time debit purchases, but you must opt in before they cover those transactions.
Financial institutions are not obligated to cover any transactions that overdraft your account, regardless of transaction type or overdraft protection status. The decision is ultimately at their discretion.
SEFCU charges $28 per item that overdraws your account.
If you overdraft your account, a number of scenarios could occur.
Overdraft fees most often occur when you are not opted into overdraft protection and the financial institution allows you to overdraft your account on automatic bill payments, checks, and other transactions made using your checking account number.
Insufficient funds fee
An insufficient funds fee — also known as a returned item fee or non-sufficient funds (NSF) fee — occurs when you make a purchase but there are not enough funds in your account to cover the transaction. Instead of covering for you, the financial institution will decline the transaction, or return the item unpaid. SEFCU charges $8 for each item that is returned unpaid. SEFCU will not charge you an insufficient funds fee for ATM or debit card transactions unless you’ve opted into the service, but can charge you a fee for automatic bill payments, checks, and other transactions made using your checking account number.
Overdraft protection transfer fee
Overdraft protection transfer fees most often occur when you are opted into overdraft protection and the financial institution allows you to overdraw your account by transferring funds from a qualifying linked account. Rather than a $28 overdraft fee, SEFCU will charge a $2.50 overdraft protection transfer fee if you transfer from a savings account. The credit union also allows overdraft protection transfers from personal lines of credit.
There is no limit to the number of overdraft fees that SEFCU can charge you on a single day.
SEFCU also offers a premium overdraft service, which covers checks, ACH transactions, and recurring debit transactions for cheaper than the standard $28 overdraft fee. You can also opt in to have SEFCU cover ATM transactions and one-time debit purchases with the premium overdraft service.
The added overdraft protection, which requires a linked account, is optional, and your financial institution is legally required to ask whether or not you want to opt in. While overdraft protection can help in a pinch, it may actually make more financial sense for you not to opt in.
According to a study by the Consumer Financial Protection Bureau, accounts that aren’t opted in typically pay less on bank fees than accounts that are opted in. If you’re having doubts about opting into overdraft protection, just remember that you can opt in or out at any time.
Overdraft fees are one of the most common charges detected on Cushion customers’ accounts, but there are small actions that you can take to avoid them:
Sure, there are ways to avoid overdraft fees, but often these charges are difficult to dodge. The good news is that if you do get hit with an overdraft fee, there are ways to reclaim that money.
Cushion’s ⚛️ Fee Genius and optional 💭 Fee Negotiation monitors your accounts 24/7, alerts you about bank and credit card fees, predicts when you’re in danger of overdrawing your account, and can automatically negotiate your fees on your behalf if you opt in.
There are things that you can do to increase your chances of success if you decide to negotiate with your financial institution on your own.
Prepare your information
Name, address, bank account number, and the fees that you’d like to negotiate.
“Hello. My name is [your name], and I recently received an overdraft fee. I’m contacting you to see if you would be willing to issue me a refund.”
Have your points of leverage ready
Have you been financially affected by COVID-19? Are you a loyal customer who has banked with SEFCU for an extended period of time? Do you have multiple accounts with the credit union? Do you make regular deposits? Is this overdraft a rare occurrence?
Be patient, persistent, and prepared not to get a refund every time
Most importantly, try to stay calm during the negotiation. A little kindness goes a long way and can help you to secure a refund. That doesn’t mean that you shouldn’t press the issue if the customer service representative initially says “no.” You’ve prepared your points of leverage for this exact moment.
Last but not least, you might lose the negotiation — and that’s okay. Not every negotiation will yield a win. Try not to get discouraged, but do try to take the necessary steps to avoid an overdraft fee in the future.
Find SEFCU’s overdraft specifications here.
Cushion helps you waste less money, save more, and live a financially healthier life. We monitor your bank and credit card accounts 24/7, find and alert you about pesky fees, let you know which fees are negotiable, which banks are cooperative, and can even automatically negotiate on your behalf.* To date, Cushion has secured customers more than $11 million in bank and credit card fee refunds—and we’re just getting started.
*Cushion only negotiates fees with high refund odds. We cannot guarantee any negotiations, a regular frequency of negotiations, or fee refunds—your bank makes the final call.