An overdraft line of credit is a formal extension of open-end credit that happens to be linked to a transaction account. Whether you need a new agreement or can increase the line by informing the customer (as with a credit card line increase) is something that state law could affect. I recommend you consult with local legal counsel.
Documentation: Increase Overdraft Line of Credit
If we increase an overdraft line of credit (unsecured) limit, what documentation do we need? Does the customer need to sign anything? Do we have to do a whole new loan or just document it in the file?
First published on 06/03/2018