Paying your monthly bills can be a hassle. If you forget to pay one or are late on your payment, you may be charged fees or, worse yet, take a hit on your credit score. Automatic debit payments make paying bills easier because, once set up, the billing company automatically withdraws what you owe on the bill's due date.
But what if you want to stop the automatic debit payments? Federal law allows you to stop automatic withdrawals, even if you have authorized them in the past. You may want to stop an automatic payment for many reasons, like if you switched to one of the best checking accounts or discontinued a membership, so read on for step-by-step guidance on how to stop these payments.
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What is an automatic payment from a checking account?
Automatic payments from a checking account occur when you authorize a company to take money out of your account to pay for recurring bills such as utilities, credit cards, gym memberships, insurance, or a loan. Automatic payments are a convenient way to pay your bills without the worry of forgetting to make a payment. Some companies will even give you a break on your monthly payments or interest rate if you set up autopay from your checking account.
To set up an automatic payment from a checking account, you’ll usually sign an authorization form that gives the billing company permission to automatically withdraw money from your bank account on a recurring basis. Your payments can be the same every month or can differ from month to month. However, if the automatic debit payment differs from the prior month or what you have authorized, the billing company has to notify you at least 10 days before the payment is withdrawn.
How to stop automatic payments from your checking account
Although automatic payments are convenient, you may have a reason for wanting to stop them. Maybe you had a change in your income and you want a better handle on money going out of your checking account. Or perhaps you want to cancel a membership.
Whatever your reasons, the best banks allow several ways to stop automatic payments from your checking account.
Reach out to the company you’re paying
Your first course of action should be to reach out to the company that you are making the automatic payments to and request to end the automatic payments. You may be required to submit a signed “revoking authorization” request.
Contact your bank or credit union
You can also reach out to your financial institution and have them cancel the automatic payment on their end. You may have to present the bank or credit union with a signed “revoked authorization” letter to stop the payments. Your bank may have an online form for you to fill out and submit to stop an automatic payment.
Issue a stop payment order
Most banks enable you to do a stop payment order. A “stop payment order” tells your bank to stop allowing a company to withdraw payments from your account. You’ll need to request the stop payment order at least 3 days before your scheduled payment.
Banks may require you to present a written stop payment order, and you may also need to include a copy of the revocation notice you sent to the billing company. Your bank may charge a fee for a stop payment order.
Tips on stopping automatic payments from your checking
If you plan to stop automatic debit payments from your checking account, here are a few tips recommended by the Consumer Financial Protection Bureau (CFPB):
- File a stop payment order at least 3 days before your scheduled payment.
- Provide the stop payment order verbally or in writing.
- Provide written stop payment orders within 14 days of your verbal notification.
- With your written stop payment order to the bank, include a copy of your revocation request to the billing company.
- Monitor your accounts to ensure the automatic payments have stopped.
- If there are issues with your revoked authorization request, you can file a complaint with the CFPB at consumerfinance.gov/complaint or call (855) 411-2372.
Can I stop a recurring payment from my bank?
Yes, you can stop a recurring payment from your bank. Federal law protections give you the right to stop automatic payments from your bank, even if you had approved them in the past. When canceling automatic payments through your bank, you can either provide the bank with a “revoke authorization” letter or ask for a stop payment order.
How are automatic debit payments different from bill pay?
Automatic debit payments are different from bill pay in that automatic debit payments are when the billing company automatically withdraws money from your account to pay your bill.
On the other hand, bill pay is an automatic bill payment system set up through your bank. With bill pay, you schedule when your bank pays your bills. Some banks charge fees for bill pay, while you can save money on bills and interest by allowing automatic debit payments from certain companies.
Can you reverse automatic payments?
You’ll need to provide a stop payment order to your bank at least 3 business days before the scheduled payment date to stop an automatic payment. If an automatic payment goes through after you’ve revoked authorization or filed a stop payment order, you have the right under federal law to dispute the charge and get your money back.
Automatic debit payments to companies you owe money can take the hassle out of paying your bills and ensure your bills are always paid on time. However, if you decide to stop authorized automatic debit payments from your bank, you are permitted to do so by federal law.
To stop automatic payments, you can either go through the billing company or your financial institution. It’s probably best to start with the billing company because your bank may charge fees or require you to present a copy of the revoke authorization letter you sent to the billing company.
For more information on how to stay current paying your bills, check out our guide on when to pay bills with a credit card.
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