How To Stop Automatic Payments to Your Credit Card and Save Big
Call and email the company with who you have the automatic payment.
Call and email your bank or credit union to ensure the automatic payment is stopped.
Give your bank a stop payment order.
3 Quick Steps To Stop Automatic Payments
How To Stop Automatic Payments On Credit Cards
Automatic payments linked to your credit card can be sometimes inconvenient.
From cable bills to gym membership, automatic payments can always be set up. It’s a way to assure vendors they are going to be paid on time.
However, automatic payments on credit cards quickly drain off your finances.
Sometimes a service provider may keep on deducting your funds long after you cancel your membership.
It gets even more complicated when the company charging your credit card won’t respond to your request.
Drawbacks To Automatic Bill Payment
Requires effort to stop
Companies make it hard to stop
You spend money needlessly
It’s a hassle if accounts change
Credit card debt you can’t afford
Drawbacks To Automatic Bill Payment
Recurring Payments Can be a Nightmare
You give a company permission to regularly take cash from your credit card.
Purchases you might be applying for include payday loan requirements, gym memberships, or newspaper subscriptions.
Companies can take payment wherever they feel like it.
It can sometimes be difficult to contact some companies. However, you do have the legal right to cancel. Even if companies fail to cooperate, banks must cancel.
The process is not hard as long as you’re dealing with reputable companies.
Cancel the payment with the company directly; this is often the easiest way. Just contact the company and request for cancellation. You can do so by writing or phone.
Ask your bank or credit provider to cancel; the Financial Conduct Authority demands that all banks must cancel when asked. Further payments mean a bank will refund the customer.
2 Steps To Stop Automatic Payments
How To Create A Stop Payment Order
Even if you have not yet contacted the company that you have the automatic payment with you can still instruct your bank with a stop payment order.
It gives the bank permission to stop allowing the company to withdraw funds from your account.
To stop all future automatic payments with a specific company you will need to contact your bank in writing and give them the following information in a letter template as follows.
To Whom It May Concern,
Please consider this letter as a written stop payment order to instruct you to stop all payments from my account (ACC INFO) to (Company Info). My account information with (Company) is. (ACC INFO).
I wish to stop all future payments to this company from (DATE) in the amount of (Amount that you pay).
How To Stop Automatic Payments
If you have called the company or credit provider, it’s a good idea to follow up in writing. This further cements proof of your instruction to cancel.
However, your call should still be treated as enough instruction to cancel.
Make sure you record the date and time this conversation ensued for future references.
Always confirm your cancelation with a follow-up email
How To Be Cautious With Automatic Payments
Automatic payments can be useful to help you stay on track with regular payments.
However, caution is needed when signing up for such agreements. Consider these points before authorizing a company to make automatic withdrawals:
Verify the company: ensure the company is legitimate and credible. You may use an alternative payment method until you are content with the company.
Know your rights: you are not required to repay a loan by automatic debit from your checking account. The only exception is if the loan is an overdraft line of credit. Be wary of a company pressuring you to repay through automatic payments.
Be careful about overdraft and insufficient funds: if your account has run low when an automatic payment is due, you face overdraft fees. Your bank and the company will charge you. These fees can add up quickly.
Review terms of the agreement: the company must give you a copy of the agreement. The terms of your authorization must be laid in clear and understandable way. Make sure you understand how much will be taken and how often.
4 Steps To Ensure Safe Automatic Payments
An automatic credit card payment can create a debt cycle if you are not aware of what is coming out of your account monthly.
- Consumer Financial Protection Bureauaccessed on July 19, 2021