What happens if your checking account is negative and you never pay them back?

Question

I have a joint checking account with my parent that I opened 5 years ago and never closed it to get my parent's name off because Chase wouldn't let me unless my parent was there. My parent had a dispute with the bank over a loan and was not going to pay the loan until the dispute was resolved. So they took over $600 out of my account, but I withdrew that money that same day. The next day they said they took there money for the loan, but my money was overdrawn, even though at the time it was in my account and I had it in my hand. My account is now negative over $600 and they are charging me $5 everyday for overdraft, potentially over $1000 a year if they let it add up . I refuse to pay the money. What will happen if I never pay the money back if anything?

Answer 1

While Chase in different states has different policies, I don't believe the overdraft/chargeoff process varies. However, in Texas, where I work for Chase, accounts are charged off after having a negative balance for 60 days (although I have seen them charged off much sooner in some cases.) At first, you (or the primary owner of the account) will receive several phone calls a day from Chase' collection department. If they are unable to recover the funds, they will forward it to 3rd party collections. At that point, it could be reported to credit bureaus and ChexSystems, making it difficult to get an account at other banks and also affecting your credit history/score.

Answer 2

First off if you are not the primary on checking account you may have done the right thing.

Now don't get me wrong your parents are not doing the right thing for themselves or you.

As a signer and not a primary account holder you have no obligation to pay, your parents do. Your parents are required to pay the Loan and the overdraft. Chase has the right to take the money out of the account to pay the loan, because your parents own the account.

Now this does not stop Chase or any one else from trying to collect from you, on the over draft. But as an authorized signer you are not legally obligated, moral obligation may be different.

This is your parents Loan, and it looks like their account. So go over to a different bank (not Chase) open up your own account and keep it in good standing. Pay your bills on time and keep your credit in good standing. If Chase calls tell them to talk to the account owners not just a signer.

Now if you are an account holder with them and not just a signer then you've got problems. But if that were the case Chase would have let you remove your parents with a removal signature card.

Good luck.

Answer 3

First of all contact the bank and see if they can work with you. Explain that it was your parents loan, not yours. They may be able to reverse some of the fees associated with the over draft to reduce the amount. By not making good on the overdrawn account it will make it very hard for you to open a new checking account any where else for years. I would also suggest that your parents give you the money since it was because of them this happened too you. Also contact a lawyer they may be able to tell you which plan of action would be best to get this cleared off of your credit report and to get it resolved.

Answer 4

1. Your parent cannot withhold loan payment over a dispute like this. Either the bank will take the money from account, or they will put the loan account in arrears and that is going to wreck parents credit.

2. This will show up on your credit and may make it impossible for you to open any other accounts.

Your dispute is a childish one. They are well within their legal rights to require the parent to close the account and for you to open your own. If they just let anyone make account changes, there would be a lot of fraud going on. You are not the primary owner of the account, you are simply a signatory. Only the primary owner can make a change like you are talking about.

You and your parents would be better off to get over yourselves and do what needs to be done before the bank totals your credit over this childishness.

Answer 5

There's a company called "ChecksSystems" or something like that that is simmilar to a credit reporting agency, but for people with just checking and savings accounts. The bank you currently have your account with could report you to them, and make it difficult for you to open bank accounts in the future.

Answer 6

Eventually they will take you to a collection agency and you could get that garnished from your wages. I would just pay it and get over it. $600 is not alot of money. Banks have more power than you do you could even go to jail for it. Pay it!!!

Answer 7

Just FYI to anyone reading the above responses - you CANNOT go to jail over a debt, particularly not one for only $600. Ever heard the phrase "There's no debtor's prison (in the US)?" The only way you can be jailed for owing money is if you fail to pay taxes, AND openly defy any attempts for the IRS to collect. If a bank even threatens jail time for this debt, you can sue them for violating the FCRA (Fair Credit Reporting Act). They can ding your credit, even keep you from getting other bank accounts, but that's about it - unless you maliciously defrauded them in the process, like repeatedly writing checks against a closed or other person's account.

Answer 8

This will not only affect your credit rating (which will affect far too much else in your life whether you ever get a loan or not), it can lead to wage garnishment and prosecution, which could bring fines and/or jail time.

Answer 9

it will definitely mess up your credit, and eventually you wont be able to buy a house, car, or anything that results in a person having to use ur CREDIT to allow YOU to get anything that is expensive....

advice: try to work on paying them something, and your parents should help as well, they might even be willing to work out a payment plan with you! or even reduce the amount!

Answer 10

Sounds weird