Overdraft: An overdraft is a withdrawal from a bank account that exceeds the funds you have available. If you overdraw your account and you have overdraft protection, the bank will transfer money up to the limit on your line of credit to your account to cover the withdrawal. Although you will pay interest on the amount the bank transfers to your account from your line of credit, it is likely to be less than the substantial fees you pay for each overdraft.

 

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Overdraft: An overdraft is a withdrawal from a bank account that exceeds the funds you have available. If you overdraw your account and you have overdraft protection, the bank will transfer money up to . . . View Full Definition

Overdraft Protection: Overdraft protection is a bank line of credit. It’s activated if you have insufficient funds to cover a check written against your account, up to a predetermined limit. As with other forms o . . . View Full Definition

Fair Credit Billing Act (1975): Federal law that covers credit card billing problems. It applies to all open-end credit accounts (e.g., credit cards, overdraft checking). States that consumers should send a written billing . . . View Full Definition

Liabilities: Obligations used to fund the operations of a business, including bank loans, accounts payable, and accrued expenses.