If you want to close your account, you should call your bank or credit union or go in person and give them your account information. Once you have made a request, state law generally requires banks or credit unions to close your account in a reasonable amount of time.
If the bank is refusing then you will need to get a local lawyer to help you contact the bank and sort this out.
In some cases, you might not be able to close the account until you pay the negative balance. In other instances, the bank might choose to close the account without your permission because it's overdrawn.
You can usually close a checking or savings account at any time, unless the account is overdrawn. Closing some accounts, such as certificates of deposit (CDs), may result in a penalty or early withdrawal fee. Closing a bank account won't impact your credit unless it makes you miss pre-authorized bill payments.
The most common reasons include suspicious account activity, too many overdraft fees and account policy violations.
Visit the nearest branch and submit the closure form in person. You have to show the KYC documents, like Aadhar and PAN, of all the account signatories while submitting the account closure request. You need to submit all the unused cheque leaves and your passbook to the bank at the time of closing the Current Account.
Closing a checking or savings account should not affect your credit score as long as the account was closed while in good standing and you update all of your automatic payment options to include your new account information.
An early account closure fee is a predetermined amount of money — usually between $5 and $50 — that the bank will charge you for closing your account soon after opening it. Of the banks that charge this fee, many will impose it upon customers who close their accounts within 90 days of opening.
“As you let your unused account remain open, you could come to realize that your bank is slowly eating away at whatever money is left,” said McDaniels. “Do not let this happen to you. Close your accounts on your own terms and keep your money.”
Depending on the facts of your case, you may be able to sue your bank in small claims court. You may also be able to join a class-action lawsuit against a particular financial services company.
Banks have the authority to freeze accounts without advance warning, particularly when urgent measures are required to safeguard assets in cases of suspected fraud or compliance with legal directives. Can money be paid into a frozen bank account? You can deposit money into a frozen bank account.
The short answer is yes. Banks can legally close your account for any reason and without notice. One of the most common reasons is due to a lack of activity.
Is there a fee to close a bank account? Generally, no. The main exception is if you close an account shortly after opening it. Some banks and credit unions charge what's called an early account closure fee that kicks in if you close an account within a time frame such as 90 or 180 days.
Once a bank account is closed, it usually can't be reopened. You'll have to open a new bank account with your institution or bank somewhere else. Some banks have second chance bank accounts, which allow you to open a bank account regardless of whether you have a negative banking history.
Generally, the bank will not close a checking account that is in an overdraft status. Such an account will be kept open until it is brought current. Then, the account can be closed. Review your deposit account agreement for policies specific to your bank and account.
To carry out the account closure process, an account holder needs to visit the branch personally. At the branch, you need to submit an account closure form along with the de-linking form, unused cheque book and debit card. In the form, you need to mention the reason for the closure of the bank account.
However, the bank is required to return any money that may have been in the account, which may be received in the form of a check or deposited into a different account that the bank has opened for you instead.
You'll likely need to complete a closing request form and have it notarized. A notary should be available at the bank. Ask for written confirmation of the account closure. The document will serve as proof that the account was closed so that you're not held liable for any fees that may occur if the bank reopens it.
Overdrafting your bank account and not paying what you owe could result in some negative consequences, like racking up even more fees, having your account closed, the debt going to collections, and difficulty opening a new bank account.
The mere act of closing a bank account doesn't have a direct impact on your credit. The Consumer Financial Protection Bureau confirms that the three major credit bureaus — Experian, Equifax and TransUnion — don't typically include checking account history in their credit reports.
Another important factor to consider when your bank account is closed is that unpaid bank balances could be forwarded to a collection agency.
Banks are required by law to keep records of your bank statements, bank transactions, and account activity for a certain period of time, even after you close an account.
To close your bank account, you must write an application letter to the manager of your respective bank branch. Along with the application, you must also include/attach the documentation required to shut your account, such as a passbook, chequebook, ATM card (debit/credit), identity proof and so on.
If you just want to close, contact your bank
Closing an account is usually straightforward, you just need to ask the bank. You can usually request this: online. by phone or live chat.