So you want to close out your bank account. How is this managed when you still have some outstanding checks or use automatic bill pay? For people wanting to close an existing checking or savings account, this isn’t something that can be done on the spur of the moment. It begins with some planning ahead and making a few calls.
Closing a checking account
With so many people banking electronically, closing a checking account is a little more involved than it used to be 20 years ago. If you have automatic payroll deposits or are paying bills electronically, then you must open a new account at the other bank before closing the old primary account.
Once you have a new account number, you can begin the process of closing out the old account.
Step 1 If your employer deposits employee paychecks directly into your checking account, the first step is to change the account number where the check is to be deposited. Usually all that is required from the payroll department is a deposit slip with the new banking account number.
It’s important to plan ahead since switching those account numbers doesn’t happen overnight . Some larger companies may take up to four weeks before depositing your payroll check in your new bank account.
Step 2 Once your paychecks are being deposited into the new account, you can move onto the next step. This involves changing out the account numbers on your Bill Pay or paperless bill accounts. These are accounts that automatically deduct your monthly bills from your checking account.
Step 3 After changing the account numbers, it’s time to look at what is outstanding in your old checking account. An outstanding check is one that hasn’t cleared the bank yet. Customers who use on-line banking should be able to tell at a glance what checks have cleared and which ones have not. Customers who prefer not to use an on-line banking service can either call their bank to learn which checks have cleared or can go into their branch office for a list. You may also choose to wait for the monthly statement to arrive in the mail.
Keep in mind that checks are good for up to at least six months after they’ve been written. If there’s a old check that hasn’t cleared yet, you might call the business or person whose name is on the check to find out what has happened.
Step 4 Once all the checks have cleared, the last step will be to visit one of the branch offices of your bank and tell them that you will be closing the account. They will ask if all the checks have been cleared, and then will prorate any bank fees or service charges to date of closure. Be prepared to give them an answer when they ask “Why are you closing your account with us?”
Step 5 The final step is to destroy all your blank checks and deposit slips, to prevent anyone from destroying your good credit with a bogus check drawn on a closed account.
