Check Overdraft Payment Policy - 08-03 DRAFT 030827

Metro Health Services FCU Check Overdraft Payment Policy

Metro Health Services FCU Check Overdraft Payment Program is a service offered to our members with checking/share draft accounts in good standing, at no additional cost, in order to assist them with their short-term payment needs and to provide them with a more advantageous, convenient and less expensive alternative to check cashing and pay-day loan establishments. This program also assures that even if a member makes a mistake in his or her check register and overdrafts his or her account, he or she will not inadvertently have a check returned for insufficient/nonsufficient funds. Additionally, this program will assist our members who have short term payment needs to avoid costly fees, expenses, litigation and prosecution that can result from an unpaid check(s)/item(s), and retain their good credit and reputation with merchants and the financial community.

We have implemented this program to improve member service and the reputation of the Credit Union and its relationship with employers in which we do business.  This program will also generate fee income and allow the Credit Union to offer our members other services.

Under our Check Overdraft Payment Program, a member of Metro Health Services FCU may overdraft his or her checking/share draft account by means of check, debit card, or EFT and we will pay the member’s overdrafts up to $1,000.00* depending on the checking/share draft account.  We will then charge the member a $21 fee for each transaction/transfer/item paid on that member’s account (included in the $1,000* limit).

When a member utilizes the Check Overdraft Payment Program, Metro Health Services FCU will notify that member by mail of the amount paid including the $21 per transfer/transaction Check Overdraft Payment Program Fee, and the member will have 30 days to repay Metro Health Services FCU for paid transactions/items plus the fee(s) for this service.

In order to be eligible for our Check Overdraft Payment Program, a member must be 19 years or older, qualify for a checking/share draft account, and be a member in “good standing” which entails:

The Check Overdraft Payment Program is a privilege we extend to all members with checking/share draft accounts in good standing without any additional charge or fee. If a member in good standing elects not use the program, he or she will incur no additional charges or fees. If a member elects to the use the program by overdrafting his or her checking/share draft account, he or she will be charged a $21 fee for each transaction/transfer/item paid on that member’s account (included in the $1,000* limit) and has 30 days to repay the Credit Union for both the amount of the overdrafted item(s) and fee(s).

Members may not overdraft their accounts under Check Overdraft Payment Program and redeposit those funds into their account.

Once a member uses the program, we will send that member a notice to advise them of 1. the items (and date of items) that activated Check Overdraft Payment Program, 2. the amounts of these items, 3. the Check Overdraft Payment Program fees that have been assessed, 4. their total Check Overdraft Payment Program balance, and 5. the date the account must be brought positive.

If a member has not repaid his or her entire outstanding Check Overdraft Payment Program obligation to Metro Health Services FCU within 30 days the member will no longer be in good standing, and Metro Health Services FCU will not honor any further overdrafts or debits to the account [even if the member has not exceeded the Check Overdraft Payment Program]. All credits will continue to be accepted.

The Check Overdraft Payment Program fee of $21 per each paid transaction/transfer/item is included in the member’s $1,000* Check Overdraft Payment Program.

Metro Health Services FCU will provide members who have difficulty repaying their obligation under the Check Overdraft Payment Program with the opportunity to sign a loan and repay their entire outstanding obligation in four months to fulfill their Check Overdraft Payment Program obligation. In the event a member does not repay his or her entire outstanding obligation to Metro Health Services FCU within 30 days, he or she will be removed from the Check Overdraft Payment Program, and subject to our regular collection procedures as addressed in Metro Health Services FCU account agreement with the member. Metro Health Services FCU also reserves the right remove a member from the Check Overdraft Payment Program for cause [check-kiting, employee abuse, default on loan, fraud, etc.] at any time, and refuse payment of overdraft items/checks drawn on that member’s account. Members who have delinquent loans of more than 30 days will also be removed from the Check Overdraft Payment Program and will also have their Check Overdraft Payment Program privileges suspended and ultimately revoked.

Upon implementation of the Check Overdraft Payment Program, Metro Health Services FCU will provide all our members with 33 days advance notice of the program/service, and the opportunity to opt out of this program-service. A member may elect to not participate in Metro Health Services FCU Check Overdraft Payment Program at any time by notifying us in a signed written request.

Metro Health Services FCU reserves the right to limit the privilege of participating in the Check Overdraft Payment Program to one account per household.

Credit Union management will adopt procedures for the Check Overdraft Payment Program that will address program promotions, administration and data processing issues, and collection and staff training issues. 

*Checking Account Type                        Overdraft Protection Amount

Free Checking                                         $300.00

Free Checking with Direct Deposit           $500.00

Executive Checking                                 $700.00

Premier Checking                                    $1,000.00