What happens if I close my checking account with my payday loans due?

Question

I let myself get sucked into this quick said, If I close my checking account and then promise to pay them within 30-45 days what will happen. The interest is killing me. I can pay them off within 30-45 days if I'm not paying the darn interest. I'm in California. They have signs saying they cannot use the Criminal Process for collecting their money.

Answer 1

I read your question a few days ago and I remembered it when I found this article on not paying back payday loans. You may want to read it.

Answer 2

If you close your checking account, the ACH (automatic payment) that they send to your bank will be returned with "Account Closed" on it.

I am not an expert on the laws of California, and I don't know if they're just saying they won't use the criminal process, or if they legally CAN'T use the criminal courts, or what. I do know that in the eyes of the law, it's the same thing as bouncing a check if you get an ACH payment returned.

The real problem is that you have a contract with the payday loan company to pay them along with their interest. Even if they're unable to collect from your closed checking account, interest will continue to accrue until its paid off. While they can't or won't use the criminal courts to collect, they CAN (and probably will) sue you in order to garnish your wages, and then instead of an automatic deduction from your checking account, your employer will be compelled by the courts to deduct it from your paycheck, and you'll STILL be subject to the interest.

Payday loans are always a really bad idea, but you've already discovered that. Good luck.

Answer 3

Almost sure that you will find every financial solution at: financial-care.info-

RE What happens if I close my checking account with my payday loans due?

I let myself get sucked into this quick said, If I close my checking account and then promise to pay them within 30-45 days what will happen. The interest is killing me. I can pay ...show more

Answer 4

You checkgin account will be "reopened" automatically because the debit transcation will be trying to access it. You will overdraft your account up to 3 times, then you will owe extra fees from your bank and possible additonal penalties from the lender.

You cannot close a checking account while auto debits are still connected to it.

They don't need to use the"criminal" process to collect their money, as with any lender they have many avenues avalable to them, to get what you owe, including garnishment.

Find a way to start paying what you owe, get a second job temporartily if you must;offer them a plan if they agree to pause or limit the excessive interest, if not this debt will get worse by the day.
Good luck.

Answer 5

Closing your bank account makes no difference to what you owe. The amount owed will just increase daily. There is no solution except to pay it off - the sooner the better. Ring them up and negotiate lower payments but they will cost you more in interest. Do not use pay day loans again.

Answer 6

You are going to have to pay it one way on another. There are many ways they can collect.

Add this to the fact that you are going to have bounced checks that will cause additional fees at your bank and you are just making the problem worse.

Lets face facts, you knew the interest rate when you signed the contract. So quit whining about something that you agreed to and pay your debt.

Answer 7

I would think a collections department or agency will be calling you continually and your credit report will show that you didn't pay back the loan.

Answer 8

They can garnish your paycheck. They will collect it and either way you do it the interest won't stop accruing just because you closed your checking account they will simply garnish your paycheck until they get their money.

Answer 9

Just pay the damn money back. You borrowed and you KNEW the interest rate.

Answer 10

Lord help you