Difference between revisions of "Overdraft"
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| − | An '''overdraft''' occurs when money is withdrawn from a [[bank account]] and the available balance goes below zero. If the customer has an agreement with the financial institution, the account is then charged interest when the money not available in the account is retrieved, and an overdraft fee may be applied. | + | An '''overdraft''' occurs when money is withdrawn from a [[bank account]] and the available balance goes below zero. If the customer has an agreement with the financial institution, the account is then charged interest when the money not available in the account is retrieved, and an overdraft fee may be applied. This tends to happen to a [[checking account]] if a check is written for a higher amount than is in it. It can happen to a [[savings account]] too, however. |
[[category:finance]] | [[category:finance]] | ||
[[category:banks]] | [[category:banks]] | ||
Revision as of 19:29, December 18, 2015
An overdraft occurs when money is withdrawn from a bank account and the available balance goes below zero. If the customer has an agreement with the financial institution, the account is then charged interest when the money not available in the account is retrieved, and an overdraft fee may be applied. This tends to happen to a checking account if a check is written for a higher amount than is in it. It can happen to a savings account too, however.