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What is Non-Sufficient Funds (NSF)?

What is NSF (Non Sufficient Funds)?

Non Sufficient Funds (NSF) means you don't have enough money in your bank account to cover a payment or a check you've written. So, if you tried to buy something or pay a bill but didn't have enough money in your account, the bank won't approve the transaction and it's said to be NSF. This usually leads to extra fees charged by your bank, and sometimes by the person or business you were trying to pay too.

3 things to know about NSF

1. NSF Can Lead to Multiple Fees: When you don't have enough money in your account to cover a transaction, you might not only be charged a NSF fee by your bank, but also by the business or individual you were trying to pay. This can add up quickly.

2. NSF Can Impact Your Credit Score: If you have too many NSF instances, some banks might report your account behavior to credit agencies. This could negatively impact your credit score, making it harder to get loans or credit cards in the future. [1]

3. Overdraft Protection Can Help Avoid NSF: Some banks offer a service called overdraft protection. It allows you to link a savings account or a credit card to your checking account. If you try to make a transaction but don't have enough money in your checking account, the bank will automatically transfer money from your linked account to cover the difference. This can help you avoid NSF fees. But remember, some banks still charge a fee for this service.



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