Comments on: Can I avoid a bill payment by canceling my bank account?

By: john

john — Mon, 23 Nov 2009 20:16:49 +0000

im with td bank what happens if i write an echeck to full tilt poker then close my account before they deduct money from my account.

By: Clever Dude

Clever Dude — Mon, 09 Nov 2009 01:17:05 +0000

Kristen, I’m not an expert in law or much of anything else, but if they’re not accepting your contract but making you pay, then that sounds illegal and grounds for small claims court. I don’t know the full details of your plight, but bring up the matter of the legality of not accepting your contract, and perhaps they’ll cancel it and refund money?

By: Kristen

Kristen — Mon, 09 Nov 2009 00:37:00 +0000

I need help, my gym closed down without any notice yesterday and they are deducting the money from my account. I have a year contract that will be up in July. How can i close my account and not have it affect my credit because this is no fault of my own? The gym is not honoring any other contracts anywhere and personally they could care less as long as they still get my money.

By: Kristy @ Master Your Card

Kristy @ Master Your Card — Sat, 06 Jun 2009 03:43:08 +0000

@ Michelle – Absolutely that counts as legit in the banks eyes. It is now a disputable item. Keep a copy of the letter and take it to the bank when disputing it. The account will most likely be frozen so nothing goes in or out and you will be given a new account number.

By: bluntmoney

bluntmoney — Fri, 05 Jun 2009 01:38:49 +0000

And sometimes they will reopen your account and pay a charge even if you DIDN’T authorize it at all…then send you to collections. (That happened to me.)

At any rate, the short answer is that no, you can’t get out of paying.

By: Melanie Reformed Spender

Melanie Reformed Spender — Wed, 03 Jun 2009 22:35:35 +0000

The bill doesn’t magically go away anyway. They can still ruin your credit.

By: Michelle

Michelle — Wed, 03 Jun 2009 19:54:44 +0000

I’m curious about this as well – Dave Ramsey advises folks all the time to never allow a debt collector to have electronic access to checking accounts, and even tells those who have provided that information to the collectors to revoke (in writing) the collector’s authorization to automatically withdraw repayments. Would that ‘revoking’ be considered legit from the bank’s perspective if the collector ignored it and continued to withdraw funds? Because DR ALSO recommends closing accounts that have been compromised in this way…

As I said – I’m curious!

By: Kristy @ Master Your Card

Kristy @ Master Your Card — Wed, 03 Jun 2009 18:31:44 +0000

Ok, banker here. Please allow me to shed some light.

When you close your account, the individual helping you should be asking questions about the automatic debits because, yes, if you try to be sneaky and close your accounts to avoid paying a bill, we’re not going to help in that endeavor – particularly if it was preauthorized BEFORE you closed your accounts. If it was something that tried to come AFTER an account was closed – like a check – then it is rejected. But automatic debits are preauthorized, and we will pay them and you are charged.

Now, if this is a fraudulent charge and you’ve contacted the company that keeps billing you to no avail, that’s a whole other situation. You have recourse and your bank can help you. You simply fill out the dispute paperwork for the charge, the bank issues a provisional credit in the amount you are disputing, and then the bank investigates the matter. Nine times out of ten, the bank just goes with the fact that the merchant isn’t supposed to be charging you and they block the transactions from coming in. They may even freeze the old account and move you to a new one, depending on what was compromised – your account number or your debit card number. But, if the merchant sends back a signed contract by yourself allowing them to debit the account, then you are liable for that and any provisional credit is reversed.

Just out of curiosity, why do you suppose it is the financial institution’s responsibility to reject an automatic debit that you have preauthorized just because you don’t want to pay them and have closed the account? Perhaps people need to consider their own personal responsibility and not put the blame on the banks for that, because let’s be honest, you’re doing something you shouldn’t be doing anyway.

Interesting question, though. Perhaps I’ll write a post about this and link back. I think it garners some great discussion.

By: Justin

Justin — Wed, 03 Jun 2009 03:25:19 +0000

This is good to know, good to know. It’s almost easier to pay the debt off but supposing you couldn’t then canceling the automatic debits first is the rational thing to do if closing a checking account is what you want to do. And then voila! One way ticket Aubagne.

By: Sylvain

Sylvain — Tue, 02 Jun 2009 09:23:28 +0000

Are you sure your bank would even close the account? Here in France, they cannot close the account if an automatic debit is scheduled. You have to cancel the automatic debit first, then close the account.