Personal Finance

Account in unauthorized overdraft since 2009

  • Last Updated:
  • Apr 29th, 2020 9:59 pm
Deal Addict
Aug 7, 2019
1240 posts
395 upvotes

Account in unauthorized overdraft since 2009

I recently took a looked at a relative's bank account and noticed that 11 cents or so of overdraft withdrawal interest were accumulating in their account every month.

Since the account summary was displaying a positive number, they thought they had a positive account balance. Additionally, since it was a savings account, they thought they were making 11 cents every month. It wasn't until I noticed the 11 cents of interest was in the withdrawal column that I realized they were actually losing money. The total amount owed was about $6.50 US.

We sent a secure message and found out that since the account was opened in 2009, there has been no activity on the account other than monthly unauthorized overdraft interest accumulating.

We got the account closed but I am wondering if this would have had any sort of negative impact on their credit score.

Some guidance regarding what our next steps should be would be appreciated.
2 replies
Deal Fanatic
Mar 21, 2010
6737 posts
3998 upvotes
Toronto
I would get a copy of their credit report and see what, if anything, is listed on there for it.
Deal Addict
User avatar
Mar 25, 2012
4335 posts
3421 upvotes
British Columbia
DrDoomsday wrote: I recently took a looked at a relative's bank account and noticed that 11 cents or so of overdraft withdrawal interest were accumulating in their account every month.

Since the account summary was displaying a positive number, they thought they had a positive account balance. Additionally, since it was a savings account, they thought they were making 11 cents every month. It wasn't until I noticed the 11 cents of interest was in the withdrawal column that I realized they were actually losing money. The total amount owed was about $6.50 US.

We sent a secure message and found out that since the account was opened in 2009, there has been no activity on the account other than monthly unauthorized overdraft interest accumulating.

We got the account closed but I am wondering if this would have had any sort of negative impact on their credit score.

Some guidance regarding what our next steps should be would be appreciated.
Highly unlikely. Usually accounts that are overdrawn due to service charges, where no limit was in place, are not reported to credit bureaus. I would be surprised if it even shows up, actually.

Bigger surprise is that they let it go that long. Usually after 1-2 months, the bank just reverses any overdraft interest and service fees and sends a 7, 10, 14, or 30 day proforma letter notifying of pending account closure.

Cheers,
Doug
Banking & Savings: Tangerine & EQ Bank
Credit Cards: American Express SimplyCash, Rogers World Elite MasterCard, Scotiabank Scene+ Visa (was Tangerine Money-Back World MasterCard)
Investments: Scotia iTRADE | Pension: Municipal Pension Plan

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