Consumerist reader Patrick wrote in to express his dismay with Bank of America. He had purchased two items online that wouldn’t be shipping until a later date, but the authorizations placed on both items by the vendors caused him to overdraft (and be charged $35 overdraft fees) for his subsequent purchases.

See, Bank of America lists two balances on your account: With Authorizations & Holds and Without Authorizations & Holds. And it looks like they use the former when determining whether or not you’ve overdrafted.

From the BofA website:

Each authorization will show as a pending transaction. When the transaction is presented to the bank, the actual purchase amount is deducted from your account, usually within two to three business days. If the authorization is not matched with an actual purchase within three business days, the transaction will no longer be displayed as pending on your account.

This is not true for all banks — I contacted Chase and was told that pending transactions and holds counted toward overdraft but that authorizations did not (though this was from a phone CSR so I wouldn’t take that as etched in stone) — so you should be sure to contact your particular bank to get the correct information.

Also, it’s not a good idea to purchase anything that isn’t absolutely necessary when you’re bank account is approaching zero. If a deposit is coming soon, it’s always best to wait. Even if something you want is on sale, do you want to risk having that savings negated by overdraft fees?

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