If you have too many overdrafts, it can lead to several negative consequences, including:
Overdraft fees: Each time an account goes into overdraft, a fee is charged. These fees can add up quickly and can become quite expensive.
Account closure: If you have a history of excessive overdrafts, your bank may decide to close your account. This can be inconvenient and make it difficult for you to manage your finances.
Difficulty opening new accounts: If your bank closes your account due to excessive overdrafts, it may also report the account closure to a check verification service, making it more difficult for you to open a new account in the future.
Legal action: If you write a check or authorize an electronic transaction with insufficient funds, the merchant or business to whom you wrote the check may take legal action against you. This could result in a judgment on your credit report, which can negatively impact your credit score.
Financial struggles: Frequent overdrafts may indicate overall financial struggles, leading to other financial problems.