When Should You File a Bank Overdraft Fee Lawsuit?
Your bank charges an “overdraft fee” when the funds in your account are not enough to cover a purchase or payment. The moment you notice an unreasonable overdraft fee in your account, it’s important to act right away — contact your bank to ensure they stop charging you, and reach out to an attorney to discuss your rights and potential legal actions.
You’re likely not the first person to be blindsided by an unauthorized overdraft fee, and you certainly won’t be the last until the bank is legally obligated to cease its overdraft practices. By contacting an attorney, you could join or prompt the formation of a class action lawsuit — a group claim that can save time and legal fees for you and other plaintiffs dealing with the same issue. In class actions, the strongest case is selected to represent the rest, and all class members share in the results of just one comprehensive decision.
If you have an issue with bank overdraft fees, it could be a case of fraud. Your decision to speak with an attorney today could ensure you claim your share of an impending class action suit, or your case could be the one that reveals the problem. Contact The Lyon Firm at our Cincinnati offices by calling (513) 381-2333 or by filling out our online form to schedule a free consultation. One call could begin a process that compensates you, alerts others, and prompts industry-wide reform for unfair overdraft practices.
How Many Times Can a Bank Charge Overdraft Fees?
The maximum number of bank overdraft fees charged each day differs between banks. However, most banking institutions cap their charges between 4-6 overdraft fees per day (though some banks may charge as many as 12 fees to a person’s account in a 24-hour period).
There are four main types of overdraft fees charged by financial institutions:
- Overdraft Fees: This standard charge is issued each time a bank approves a transaction that is higher than the balance of your funds. Many banks do not charge this fee if the discrepancy is less than $5, but that threshold differs between institutions.
- Non-Sufficient Funds Fees (NSFs): This fee is charged each time a bank rejects a transaction because there is not enough money in your account to cover the amount. This fee amount is often the same as the overdraft charge, but an overdraft and an NSF fee should never apply to the same transaction. The bank either accepts or rejects the transaction, and applies the appropriate fee.
- Overdraft Protection Fee: If you have sufficient funds in your savings account that can cover charges in your debit account, the bank may transfer those funds to “protect” you from an overdraft. That protection also charges a fee, but legally cannot be enacted automatically — you must opt-in to receive this service. It usually costs less than an overdraft fee, especially considering that you can be hit with multiple overdrafts during one statement period without notification that something is wrong.
- Extended Overdraft Fee: Also known as an “extended overdrawn balance fee” or “sustained overdraft,” this may be charged if an account balance sits in the negative for a certain amount of time, like 5 business or 7 calendar days. Some banks charge this fee once every 5 days, while others may apply the fee every day until a checking account balance is above zero. The maximum amount of extended overdraft fees also varies between banks.
These fees form a progressive chain that can quickly devastate a person’s finances. In one day, and without notification, a bank may reach their maximum of overdraft fees, and then continue charging NSF fees, increasing the amount you owe. After a week, they can start piling on extended overdraft fees as well. This chart shows the timeline of how one overdraft fee can compound:
This means that after just one paycheck error, a person could be in debt for a substantial amount of money in one month between bank statements. These kinds of unexpected fees could compromise a person’s ability to pay rent, afford transportation to work, or pay for childcare, food, or medicine. A lawsuit can help you recover what you lost, and possibly change these practices before they victimize others.
ABOUT THE LYON FIRM
Joseph Lyon has 17 years of experience representing individuals in complex litigation matters. He has represented individuals in every state against many of the largest companies in the world.
The Firm focuses on single-event civil cases and class actions involving corporate neglect & fraud, toxic exposure, product defects & recalls, medical malpractice, and invasion of privacy.
NO COST UNLESS WE WIN
The Firm offers contingency fees, advancing all costs of the litigation, and accepting the full financial risk, allowing our clients full access to the legal system while reducing the financial stress while they focus on their healthcare and financial needs.
Why are Class Actions Important?
Without class actions, large corporate defendants would be able to cause small amounts of harm over a large group of individuals without any risk of monetary penalty.
Class Action allow a Plaintiff who would ordinarily not have access to the Court bring a collective action. Class Actions enforce regulatory statutes & common law caused of action that keep companies honest and hold them accountable when they deceive the public or fall below acceptable industry standards.
Class Action vs. Mass Tort: The Value of Consolidation
There is power in numbers. By joining forces with others who have suffered similar injuries or circumstances, individuals are able to access better results at a faster rate.
Contact
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CINCINNATI HYDE PARK OFFICE
2754 Erie Ave
Cincinnati OH 45208
513.381.2333
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CLEVELAND OFFICE
6105 Parkland Boulevard
Mayfield Heights, Ohio 44124
800.513.2403