How to Avoid Overdraft and Bounced Cheque Fees
Here are some useful tips on how to avoid overdraft and bounced cheque fees. When you write a cheque, withdraw money from an cash machine, use your debit card to make a purchase or make an Direct Debit bill payment or other electronic payment for more than the amount in your current account, you overdraw your account. Your bank has the choice to either pay the amount or not. If it pays even though you don't have the money in your account, you may be charged an "overdraft" fee. If your bank returns your cheque without paying it, you may be charged a "bounced cheque" fee. The best way to avoid overdraft and bounced cheque fees is to manage your account so you don't overdraw it. Keep track of how much money you have in your current account by keeping your account register up-to-date. Record all cheques when you write them and other transactions when you make them. And don't forget to subtract any fees. Pay special attention to your electronic transactions. Record your cash machine withdrawals and fees, debit card purchases, and online payments. Don't forget about Direct Debit bill payments you may have set up for utilities, insurance, or loan payments. Keep an eye on your account balance. Remember that some cheques and automatic payments may not have cleared yet. Review your account statements each month. Between statements, you can find out which payments have cleared and check your balance by calling your bank or by checking online or at a cash machine. Sometimes mistakes happen. If you do overdraw your account, deposit money into the account as soon as possible to cover the overdraft amount plus any fees and daily charges from your bank. Depositing money into your account can help you avoid additional overdrafts and fees. Banks may provide other ways of covering overdrafts that may be less expensive. Ask your bank about these options before making your choice. You may be able to: Link your current account to a savings account you have with the bank. If you overdraw your current account, the bank can transfer funds from your savings account to your current account. Set up an overdraft limit of credit with the bank. You need to apply for a "line of credit" just as you would apply for a regular loan. If you overdraw your account, the bank will lend you the funds by using your line of credit to cover the overdraft. You will pay interest on this loan, and there may be an annual fee. You may freely reprint this article provided the author's biography remains intact: John Mussi is the founder of Direct Online Loans who help UK homeowners find the best available loans via the http://www.directonlineloans.co.uk website.
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