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Overdraft Privilege

What you need to know about our overdraft services

An overdraft occurs when a customer does not have enough money in his/her account to cover a transaction, but we pay it anyway.

We can cover overdrafts in two different ways:

  1. We have a standard Overdraft Privilege service that comes with most accounts
  2. We also offer other options, such as a link to an American Bank of Texas savings account

Standard overdraft practices

We authorize and pay overdrafts for the following types of transactions:

  • Checks and other transactions made using your checking account number
  • Automatic bill payments

We can no longer automatically authorize and pay overdrafts for the following types of transactions unless you tell us you want to us to:

  • ATM withdrawals
  • One-time debit card transactions

We pay overdrafts at our discretion, which means we do not guarantee that we will always authorize and pay any type of transaction. If we do not authorize and pay an overdraft, your transaction will be declined.

Fees charged if American Bank of Texas pays an overdraft

Under our standard overdraft practices:

  • We will charge a $27.50 fee each time we pay an overdraft.
  • You will be charged for no more than ten (10) overdraft item fees and NSF item fees per day.

For more information, read Overdraft Privilege Policy below.

Overdraft Privilege Policy

An insufficient balance can result from several events, such as (1) the payment of checks, electronic funds transfers or other withdrawal requests; (2) payments authorized by you; (3) the return of unpaid items deposited by you; (4) bank service charges; or (5) the deposit of items which, according to the bank’s Funds Availability Policy, are treated as not yet available or finally paid. We are not obligated to pay any item presented for payment if your account does not contain sufficient funds.

However, if you maintain your account in good standing, we may approve your overdrafts within your current available Overdraft Privilege limit as a non-contractual courtesy. Your account is in good standing if you (1) demonstrate responsible account management - such as making regular deposits to bring your account to a positive end-of-day balance at least once every 30 days (including the payment of all bank fees and charges); (2) avoid excessive overdrafts suggesting the use of Overdraft privilege as a continuing line of credit; and (3) there are no legal orders, levies or liens against your account.

In addition, based upon our review of your account management, if we determine you may be using Overdraft Privilege as a regular line of credit by creating excessive overdrafts, we may suspend the privilege without any prior notice. In the normal course of business, we generally pay electronic transactions first and then checks, per the bank’s policy. We reserve the right to change the order of payment without notice to you. Also, please be aware that the order of item payment may create multiple overdrafts during a single banking day for which you will be charged our paid insufficient item fee of $27.50 for each overdraft paid up to 10 per day. We may not impose a service charge in connection with an overdraft that results from a transaction at an ATM or a one-time debit card transaction unless you have given us your consent to pay service charges in connection with overdrafts that result from these transactions and we have provided written confirmation of that consent to you. You may revoke that consent any time.

You may opt out of the privilege at any time, but you are responsible for any overdrawn balances at the time of opting out. Normally, we will not approve an overdraft for you in excess of the predetermined amount assigned to your account type. So as not to exceed your limit, please note that the amount of the overdraft plus the bank’s paid insufficient item fee of $27.50 per item will be deducted from the overdraft limit.

We may refuse to pay an overdraft for you at any time even though we may have previously paid overdrafts for you. You will be charged a return insufficient item fee of $27.50 for each item returned. You will be notified by mail of any non-sufficient funds items paid or returned that you may have; however, we have no obligation to notify you before insufficient item fee of $27.50 and/or a return insufficient item fee of $27.50 that you owe us shall be due and payable upon demand. If there is an overdraft paid by us on an account with more than one 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 overdraft plus our paid insufficient item fee of $27.50.

Overdraft Privilege should not be viewed as an encouragement to overdraw your account. As always, we encourage you to manage your finances responsibly. If you would like to have this service removed from your account, please call (800) 567-1817.

Please note that your Overdraft Privilege limit may be available at the teller window, Online Banking, Bill Pay, and Telephone Banking. If you opt in, your Overdraft Privilege limit may also be available for ATM and POS (point of sale) transactions. The limit will not be included in the balance provided during an inquiry.

Limitations: Overdraft Privilege is a non-contractual courtesy that is available to individually/jointly owned accounts in good standing for personal or household use, and for some business account types. American Bank of Texas reserves the right to limit participation to one account per household or business and to discontinue this service without prior notice.