Overdraft Coverage Options

Life happens!  Desert Schools understands that unexpected overdrafts occur from time to time - overdraft coverage can help.

What are my overdraft coverage options?

The choice is yours. Consider these ways to cover overdrafts:

Service Cost
Link to a deposit account you have at Desert Schools1 $5 fee per transfer
Overdraft Protection Line of Credit1 2 $5 transfer fee + interest
Privilege Pay $35 Paid NSF fee

1Contact Desert Schools Member Assistance Center at 602-433-7000, or come by a branch to sign up or apply for these services.
2Subject to credit approval.

What is Overdraft Protection?

Overdraft Protection services apply to all types of transactions and may help protect your account from being overdrawn by automatically transferring funds to your checking account from another account or line of credit you may have at Desert Schools for a fee or finance charge. Please note that overdraft lines of credit are subject to credit approval.

What is Privilege Pay?

Privilege Pay is a courtesy overdraft coverage that allows you to overdraw your account up to the disclosed limit for a fee in order to pay a transaction.

Desert Schools may provide you a specific Privilege Pay limit depending on the type of account you have. New consumer accounts will receive a letter approximately 30 days after account opening, new business accounts after 60 days, informing you that Privilege Pay has been activated on your account. You do not have Privilege Pay until you receive this notification. Even if you have Overdraft Protection as described above, Privilege Pay is still available as secondary coverage if the other protection sources are exhausted.

Please be aware that the Privilege Pay amount is not included in your balance provided through online banking, mobile banking, telephone banking or Desert Schools ATMs.

What types of transactions does Privilege Pay cover?

The types of transactions covered by Privilege Pay depend on the coverage selected. See the chart below for more information.

If you choose Full Coverage, all the transaction types listed in Standard Coverage are included, along with ATM withdrawals, ATM, transfers, and everyday debit card transactions. Desert Schools will not authorize overdrafts for ATM withdrawals, ATM transfers, and everyday debit card transactions on consumer accounts unless you give us your consent to pay these overdrafts by electing Full Coverage*. Business accounts automatically have Full Coverage*.



Standard Coverage (No action required) Full Coverage (Your consent required*)
Checks X X
ACH - Automatic Debits X X
Recurring Debit Card Payments X X
Online Bill Pay Items X X
Online Banking Transfers X X
Telephone Banking X X
ATM Withdrawals
X*
ATM Transfers to other accounts
X*
Everyday Debit Card Purchases
X*

How much does Privilege Pay cost?

There is no fee for having Privilege Pay unless you use it. The Paid NSF Fee of $35 per transaction will be imposed for overdrafts created by checks, ACH, point-of-sale, ATM withdrawals, ATM transfers, or by other electronic means. If multiple items would overdraw your account on the same day, each item would be assessed the appropriate fee. This is the same fee that Desert Schools charges for items returned to the payee due to insufficient funds.

For consumer accounts, there is a maximum of five (5) Paid NSF Fees or Unpaid NSF Fees ($175) per processing day that will be charged. Desert Schools will not charge Paid NSF Fee if a consumer account is overdrawn by $5 or less. These exceptions do not apply to business accounts.

All fees and charges will be included as part of the Privilege Pay limit amount. Your account may become overdrawn in excess of the Privilege Pay limit amount as a result of the assessment of a fee. The total negative balance, including all fees and charges, is due and payable upon demand. All owners of an account will be jointly and severally liable for all such amounts as described in the Statements of Terms, Conditions and Disclosures.

What if I don't want Privilege Pay?

You can request to discontinue the Privilege Pay service in its entirety at any time by contacting Desert Schools Member Assistance Center at 602-433-7000. You will be charged the standard Unpaid NSF Fee of $35 for all returned items.

What if I want Desert Schools to pay my ATM and everyday debit card overdrafts (full coverage)?

If you want Desert Schools to authorize and pay overdrafts caused by ATM withdrawals, ATM transfers, and everyday debit card transactions (Full Coverage), tell Desert Schools by using one of the following methods:

  • Call Desert Schools Member Assistance Center at 602-433-7000
  • Log into your account through Online Banking at desertschools.org.
  • Visit one of Desert Schools convenient branch locations
  • Complete the Consent Form, which is available at any branch and mail it to Desert Schools at Attn: Member Assistance Center, P.O. Box 2945, Phoenix, AZ 85062-2945.

NOTE: Business accounts automatically have access to Privilege Pay for ATM withdrawals, ATM transfers, and everyday debit card transactions (Full Coverage).

What else do I need to know?

  • Desert Schools generally posts items in the following order: Teller transactions and other force post items (order in which they are received), 2) Recurring Non-PIN Point of Sale transactions (order in which they are received), 3) ATM transactions (order in which they are received), 4) Non-PIN Point of Sale transactions (order in which they are received), 5) PIN Point of Sale transactions (order in which they are received), 6) ACH Credits (order in which they are received), 7) ACH debits (order in which they are received), 8) External Transfers, 9) Scheduled Disbursements, 10) Automatic Loan Payments, 11) ONUS Check Clearing (order in which they are received); however exceptions may occur. Holds on funds, as described in this website, and the order in which transactions are posted may impact the total amount of Paid NSF Fees or Unpaid NSF Fees assessed.
  • A single larger overdraft will result in just one Paid NSF Fee, as opposed to multiple smaller overdrafts.
  • Although under applicable card network rules, Desert Schools may be obligated to pay some unauthorized debit card transactions, Desert Schools will not authorize debit card or ATM transactions unless there are sufficient available funds (including overdraft coverage) to cover the transactions and the amount of any fee(s).
  • Giving Desert Schools your consent to pay everyday debit card and ATM overdrafts may result in you incurring Paid NSF Fees for transactions that would otherwise be required to pay without assessing a Paid NSF Fee. However, this may allow Desert Schools to authorize transactions up to the amount of your Privilege Pay limit and may also help you avoid overdrafts in excess of your available funds that could result in restriction of your debit card.
  • Desert Schools authorizes and pays transactions using the available balance in your account. The available balance is comprised of the ledger balance (collected funds) less any debit card holds, and does not include any deposited funds on hold. Desert Schools may place a hold on deposited funds in accordance with the Funds Availability Policy as stated in the most recent Statements of Terms, Conditions and Disclosures. If the available balance is not sufficient to cover a transaction, any available overdraft protection and/or the amount of the Privilege Pay limit, may be used to authorize and pay a transaction.
  • Desert Schools will place a hold on your account for any authorized debit card transaction until the transaction settles (usually within two business days) or as permitted by card network rules. In some cases, the hold may exceed the amount of the transaction. When the hold ends, the funds will be added to the available balance in your account. If your account is overdrawn after the held funds are added to the available balance and the transaction is posted to the available balance, a Paid NSF Fee may be assessed.
  • Except as described in this website, Desert Schools will not pay items if your account and other sources do not contain sufficient funds (including the Privilege Pay limit) to cover the item(s) and the amount of any fee(s).
  • Desert Schools may restrict your debit card use if you incur overdrafts in excess of the available funds in your account including any Privilege Pay limit.
  • Privilege Pay is not a line of credit; it is a discretionary overdraft service that can be withdrawn at any time without prior notice.
  • Privilege Pay may be discontinued if you default on any loan or other obligation to Desert Schools, your account becomes subject to any legal or administrative order or levy, or if you fail to maintain your account in good standing by not bringing your account to a positive balance within thirty (30) days of the initial overdraft date.

Overdraft Protection and Privilege Pay Summary

  • Overdraft Protection services allow you to link other sources you have with Desert Schools to your checking account in order to prevent overdrafts and are less expensive options than an overdraft.
  • Privilege Pay allows you to overdraw your account for a Paid NSF Fee of $35 per transaction in order to pay a transaction.
  • Privilege Pay limits of up to $800 are available for eligible personal checking accounts opened at least 30 days in good standing.
  • Privilege Pay limits of up to $800 are available for eligible business checking accounts opened at least 60 days in good standing.
  • Standard Coverage covers checks, online bill payments, ACH transactions, and automatic/pre-authorized debits that you establish (insurance premiums, utility bills, etc.).
  • Full Coverage covers ATM withdrawals, ATM transfers and everyday debit card transactions on your personal accounts with your prior consent. Business accounts automatically have Full Coverage.
  • Both Overdraft Protection and Privilege Pay may enable you to avoid expensive merchant returned-check charges.
  • Both Overdraft Protection and Privilege Pay may enable you to avoid having your ATM withdrawals, ATM transfers, or debit card transactions declined due to insufficient funds.
  • You must deposit the full amount of the overdraft within thirty (30) days from the initial overdraft date, including any fees assessed to continue to receive Privilege Pay.
  • Good account management is the best way to avoid overdrafts. Use Desert Schools mobile banking, online banking, and telephone banking services to help keep track of your balance.
  • For additional money management tips, visit Desert Schools website at desertschools.org.

If you have questions about Overdraft Protection or Privilege Pay, please call Desert Schools Member Assistance Center at 602-433-7000.