Stop Automatic Payments to Credit Card and Save Big
- August 27, 2017
- 2 min read
- 14802 reads
Automatic payments linked to your credit card can be sometimes inconveniencing. 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 card quickly drain off your finances. Sometimes a service provider may keep on deducting your funds long after you cancel membership. It gets even more complicated when the company charging your credit card won’t respond to your request.
Drawbacks To Automatic Bill Payment
- Require 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
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 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.
How To Stop Automatic Payments
- 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.
If you have called, 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.
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.