OVERDRAFT LINE OF CREDIT

More Flexible Purchasing Power With an Overdraft Line of Credit

An Overdraft Line of Credit can help you manage your expenses while also safeguarding you from fees in the event your account balance drops below zero. Having a Overdraft LOC with your UFCU accounts can help you maintain financial balance while borrowing what you need from a credit union you trust. 

Advantages of an Overdraft Line of Credit

  • Immediate access to funds that can help you every day or during emergencies
  • Competitive rates based on credit history and account relationship
  • Most members will qualify for limits between $500 and $7500 (higher limits may be considered)
  • Affordable monthly payments

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How Does Overdraft Protection Work?

When you have a pending bank transaction that is higher than your checking account balance, your bank might do one of the following things:

  • Cover the pending transaction but charge you an expensive fee
  • Reject the pending transaction and charge you a fee for non-sufficient funds

With overdraft protection, you still need to manage your money responsibly, but you have an extra layer of protection in case you experience a shortfall in funds or financial emergency.

Do I Need Overdraft Protection?

Overdraft protection provides you with a safeguard in the event of a financial emergency. You can avoid expensive bank fees and always cover pending transactions from your checking account. 

Without overdraft protection, your bank might decline pending transactions if there isn't enough money in your checking account. This can cause the following problems:

  • Your bank can charge you a fee for having non-sufficient funds.
  • The merchant that presented the payment might charge you an additional fee.
  • You might not be able to pay for household groceries, rent, bills, and other goods and services. 

One of the easiest ways to guarantee pending transactions go through is an overdraft line of credit. This short-term borrowing facility covers pending bank transactions if there is not enough money in your checking account (up to a certain limit). This provides you with peace-of-mind. 


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University Federal Credit Union values you. That's why we work so hard to protect your security, your finances, your family and your future. For more information on the benefits of your membership with UFCU, see our Member Services page or visit any of our UFCU branches