Automatic Payment Nightmare!

[nvbk2009]

I've been lurking for quite a while. We came to the conclusion that bankruptcy was the only way out of the mess we're in a few months back. We just need to wait for extra money to drop off that I made in April. We will be filing for chapter 7 in the next few months.

Quick run down of our situation:


hubby's pay has been cut drastically, but he is still working
my business is under water and I'm afraid I'll have to throw in the towel soon. It's just a small Ebay business, but it does pay for groceries and other little items needed each month. Or I should say it used to, up until this month.

I am really going to be in a pickle in about 2 weeks. Since I've made just about nothing this month, I knew I had to stop my auto payments from bank account. Car and mortgage payment. I called both companies and was told they need at least 30 days notice to stop auto pays? Called WF bank and they can't stop the payments either. Does this sound correct? We are not going to have money to cover the overdrafts fees! I would have had the money to pay both payments by the 9th, but I doubt I can cover the overdraft fees! Wells Fargo really racks those up very fast! I can't even use their wonderful 120% direct deposit advance, because I won't be able to pay that fee!

We were going to switch banks this month, but it doesn't look that's gonna happen now. We have a cc with WF that we will be including in bk. Once we switch banks, that will free up another chunk of cash we can use for catching up on mortgage and car on the 9th.

I am freaking out right now! Does any one have any suggestions? I sure don't want to end up in jail over this.

I've searched the boards about overdrafts, but it seems every one's issue is a bit different.

Thanks in advance!

[AlreadyFiled]

get a new checking account @ a different bank then where your mortgage or cc is.

that would be the easiest, unless im missing something?

also, if your checking/savings is with WF and so is your cc (if you've stopped paying it) they can take from your checking/savings without your permission and apply it to the balance of the cc. It's called right to offset. it's in the small print when you first opened the WF account.

always keep your cc's and your checking/savings at two different banks.

not that you should bank on this ever happening again, but it is good for reference.

[LuciluS]

get a new checking account @ a different bank then where your mortgage or cc is.

that would be the easiest, unless im missing something?

also, if your checking/savings is with WF and so is your cc (if you've stopped paying it) they can take from your checking/savings without your permission and apply it to the balance of the cc. It's called right to offset. it's in the small print when you first opened the WF account.

always keep your cc's and your checking/savings at two different banks.

not that you should bank on this ever happening again, but it is good for reference.

Agree & Go close the Other Account. Immediately!! Don't mention the ACH's either. Any overdraft fees on a closed account can be included in the Bankruptcy. Make sure you get something in writing that the Account has been closed.

Let the bank worry with those ACH's that will be coming through on a CLOSED ACCOUNT!

[nvbk2009]

Thank you so much for the replies! This forum is a life saver!

Well, I went down to the bank. Can't close the account since I quit paying on the cc and hubby's direct deposit is due to hit tomorrow. Uggggg! Must be that right to offset thing.

I called hubby and he is talking to payroll to find out how long it takes to stop the direct deposit for Wells Fargo. I will be opening an account tomorrow with a small local bank in this area.

The mortgage and car are not with Wells Fargo or the new local bank. We will be reaffirming both. Car is just about paid off anyway. House payment is lower than any rent around here.

But, the Wells Fargo account will still be 'open'. Is this going to be a problem? Maybe I should pay the cc and then close the account? I sure don't want to get into a bunch of trouble over this.

Best diet I've ever been on! I swear, I've lost 10 pounds today alone! To say this is nerve wracking is an understatement.

[2manybills]

Wells Fargo is the worst to deal with as far as BK's go. Your husband's auto deposit should be able to pull it back from Wells and redeposit to a new account. May be too much though for only one day left.

Unless you absolutely have to, I would close Wells. They have been known to freeze accounts even if you don't owe them money.

[whipster1]

Maybe I should pay the cc and then close the account?

Nope can't pay one creditor in preference over the others. Wells will freeze accounts so get your money out ASAP.

[2manybills]

If it were me, I would be at Wells in the morning when your husband's check hits, withdraw the money and close the account.

[shabam]

As soon as your husbands pay is deposited, withdraw the cash and close the account. Then find another bank and open an account with them. If you have any trouble closing the account, just include any fees in your ch 7. I would then contact any company processing automatic payments and advise them that this account is closed and that you will pay them manually. Also, immediately swap your husbands direct deposit (future pay) details to that of your new bank.

[lrprn]

Most banks and credit unions will not allow an account to be closed if it has a negative balance. The negative balance must be cured to close the account.

Yes, you can list a negative account owed on your bankruptcy, but that gets you entered into the CHEX system. This makes is very difficult to open another account elsewhere until your bankruptcy is discharged and you can provide a copy of your discharge to CHEX and get yourself off the list.

[LuciluS]

Our small town bank opens at 7 am. Whatever time the location of the bank opens, Be There to draw all the funds out. If they ask why, "we are moving".


We are moving can be interpreted different ways. So it's not a lie as you are moving your checking account. If they ask further questions, just tell them you cannot be late for work and may you please have your money.

Good Luck!

[nvbk2009]

There lies the problem. The credit card is in a negative right now. WF will not close the account unless I make a payment of $140.00 to bring the credit back to a positive status. The checking account is positive right now.

I can open another account tomorrow at the local bank. Hubby's paycheck will cover that.

We will just include all charges in bk, if I understand correctly? I only have 2 other auto pays and they are easy to deal with! Life insurance and our water bill. The two that have me worried are the house payment and the car, which we plan to refirm.

Once again, we can keep current on the house and car, but these are going to be late pays right now, or overdrafts. My Ebay business is in the red and tanking fast. Hubby can't switch banks until next pay day. WF will pay these auto bills and dig us in deeper.

Sorry, but I am freaking out right now! Thanks for all responses!

[shabam]

Send them a message online indicating you would like to close the account, cancel any automatic payments, and cancel any overdraft protection. Even if they deny it or give you the run around, you can print out a record of their response and show you at least tried to get them to cancel the account. After that, I would just leave the account alone.

Open a new account with someone else asap. That is, someone you don't owe any money to. Then immediately switch all transactions to the new account.

[destitute]

They may not let you officially close the account but you should be able to pull all of your money to move to the new bank. I ran into a similar problem with key bank. They wouldn't let me "close" the account because I have an overdraft tied to it that I owe $500 on. I told them in writing that I wanted the checking account closed and since it has a 0 balance (I withdrew all my $$ and moved to a different bank) I was considering it closed. I included them in my Chapter 7 and I'll send the discharge papers to chex systems if I have to . I hear they are pretty good about removing you from their list in that case.