OVERDRAFT & COURTESY PAY POLICY
Financial Plus Credit Union offers both Overdraft Protection and Courtesy Pay services in an attempt to honor member checks and other transactions, in the event that there are insufficient funds in a checking account to cover a transaction presented for authorization or payment. Such transactions may include checks, preauthorized debits, and debit card transactions. Members may participate in both Overdraft Protection and Courtesy Pay services.
OVERDRAFT PROTECTION SERVICES
The Overdraft Protection service automatically transfers available funds from a member’s Regular Share account, and/or other Credit Union share or loan accounts designated by the member, in an attempt to pay a check, preauthorized debit, or debit card transaction when there are insufficient funds in the checking account.
Members may designate overdraft transfers from Share, Miscellaneous Share, Hi-Yield accounts, or line of credit loans. Overdraft Protection Line of Credit loans are available, subject to application and approval. In addition, transfers may be made from other member accounts, with proper authorization. Several transfers may be made to cover a single transaction.
A small fee is charged to cover the cost of mailing transfer notices and account servicing. The fee amount is subject to change, upon approval of the Board of Directors, and proper member notification.
COURTESY PAY SERVICES
The Courtesy Pay service permits members to overdraft their checking account, up to a specific limit authorized by the Credit Union. Under the service, the Credit Union overdraws, or agrees to overdraw, an account to provide for the payment of a transaction that would otherwise be returned unpaid, or rejection of a preauthorization request, due to non-sufficient funds (NSF). The Credit Union is under no obligation, unless it has contracted to the contrary, to pay a transaction if it would result in the account being overdrawn. The Credit Union has the option of honoring a check, preauthorized debit, or debit card transaction when the checking account has non-sufficient funds, or may dishonor it, solely at the Credit Union’s discretion.
The Credit Union will offer Courtesy Pay services to members “in good standing.” To be considered “in good standing”, the following qualifications must be met:
• Member must make regular deposits to the checking account;
• Member must not have been more than thirty (30) days past due on a loan or credit card with the Credit Union;
• Member must not have caused a loss to the Credit Union; and
• Account is not subject to any legal or administrative order or levy.
• Members will continue to remain eligible for Courtesy Pay services, provided the above qualifications continue to be met, and the checking account is returned to a positive balance once every thirty (30) days.
• Each primary member may be eligible for Courtesy Pay services on just one of their checking accounts.
Specific Types of Transactions Subject To Courtesy Pay Services
The Credit Union offers Courtesy Pay services for the following types of checking account transactions:
• Checks, automated clearinghouse (ACH) debits, automatic (recurring) bill payments, and other transactions made using the member’s checking account number;
• Automatic (recurring) debit transactions made using the member’s debit card number;
• One-Time (Everyday) debit card transactions. o Prior to assessing a fee for one-time debit card transaction overdrafts, the Credit Union must provide members with the right to opt-in, or affirmatively consent, to the Credit Union’s Courtesy Pay service for one-time debit card transactions. This option is offered at the time Courtesy Pay services are implemented, and may be revoked, upon the member’s request at any time.
Courtesy Pay Limits
Courtesy Pay services are typically offered at the time a new checking account is opened, but may be added at any time.
New checking accounts are eligible for a Courtesy Pay limit of $100, upon account opening. This limit may be increased to $300 after ninety (90) days, and $500 after two hundred seventy (270) days of account opening, provided the member remains in good standing, as defined above. The maximum authorized Courtesy Pay limit is $500, however, certain Amalgamated Credit Union merged accounts may have a $700 grand-fathered limit.
The total dollar amount of all overdrafts, including fees, the Credit Union will honor per member at any given time shall not exceed the limit available under the Courtesy Pay service or funds available to be transferred from Overdraft Protection designated accounts.
In accordance with the Membership and Account Agreement, members agree to deposit sufficient funds to cover the amount of any overdraft(s), and applicable fee(s). Failure to cover any resulting deficiency balance in a timely manner will result in account privilege restrictions, and/or account closure.
• Members are given thirty (30) calendar days from the day the first Courtesy Pay overdraft occurred to either deposit funds to bring the account to a positive status, make payment arrangements, or obtain an approved loan from the Credit Union to cover the deficiency.
• After 30 days, Courtesy Pay notices are sent, informing the member that Courtesy Pay services have been suspended due to failure to bring account positive within thirty (30) days.
• If the negative account balance is paid within forty-five (45) days of the date that the account first became overdrawn, Courtesy Pay services are automatically reinstated, and members are sent a notice, informing them of the reinstatement of Courtesy Pay services.
• Courtesy Pay overdrafts that remain unpaid in excess of sixty (60) days will result in checking account closure, and handled in a manner consistent with the Credit Union’s Collection Policy.
• If the account is a joint account, all of the account owners are jointly liable to repay the Credit Union the amount of any overdraft and fees, regardless of which of the parties created the overdraft.
Applicable fees will be assessed for each overdraft. If the account is overdrawn $25, or more, the account will be assessed a fee. If the account is overdrawn less than $25, the account will be assessed a reduced fee amount. The fee amount is subject to change, upon approval of the Board of Directors, and proper member notification.
Disclosures and Notices
Members will be provided a disclosure of the fees and list of categories of transactions for which an overdraft fee may be imposed, at the time any Courtesy Pay services are authorized.
• The Disclosure will provide information and an opportunity for members to affirmatively consent (Opt-In) to enroll in Courtesy Pay services to pay overdrafts on one-time debit card transactions, and the right to revoke consent.
• Members automatically included in the program will also be provided notice of automatic eligibility and provided the Courtesy Pay limit assigned to the account, as well as an option to terminate, all or part, of the service.
• Members will be provided notice at the time the Courtesy Pay limit is increased, and the amount of the new limit, as applicable.
• The Credit Union will provide a periodic statement disclosure regarding the total amount of overdraft fees or charges imposed on an account for the statement period and calendar year to date.
• Members will receive notice each time the checking account is overdrawn through use of the Courtesy Pay service, and periodic reminders throughout the period that the account remains overdrawn.
The Credit Union will not state the available overdraft limit available to individual member accounts in any advertisement or periodic statement. All advertising will state that overdrafts are paid solely at the Credit Union‘s discretion.
No Preferential Treatment
Credit Union staff and board members will not be granted preferential treatment and are subject to the Credit Union’s standard terms and conditions as applicable to its members. However, the Credit Union may waive fees, up to an amount approved by the Board of Directors, under a formal employee discount program.
Negative Account Balances
The Credit Union may immediately terminate the Courtesy Pay program for members who fail to pay any negative balance amounts upon demand. The Credit Union may also close member accounts sixty (60) days after written notice to the member regarding a negative account balance. Lack of response from the member to cover the overdraft or make payment arrangements will be deemed to be a voluntary withdrawal from Credit Union membership.
DETERMINATION OF CHECKING ACCOUNT BALANCE FOR BOTH OVERDRAFT PROTECTION AND COURTESY PAY SERVICES
When determining whether a check or other item drawn on the checking account would be paid, for both the purpose of determining whether and how to pay an item and whether a fee related to an item being an overdraft may be charged, the Credit Union will use the “Available Balance” in the checking account at the time the item is presented for payment. The Available Balance will also be utilized to authorize or decline a transaction preauthorization request.
The Available Balance is the balance shown on the books of the Credit Union reduced by:
o The amount of any holds in place with respect to deposited checks or other items;
o The amount in the account that is subject to any preauthorization requests related to the account that have been accepted by the Credit Union;
o Amounts in the account that are subject to holds based on court, tax agency, or other governmental proceedings; and
o Amounts that the Credit Union believes are subject to a dispute over ownership or other rights.
The use of the Available Balance for these purposes may cause a fee related to an overdraft to be charged, or a line of credit advance or transfer from another account to be made, even though the periodic statement may not reflect any time when the balance would be negative.