Whether you’re trying to cut back on spending or switching bank accounts, sometimes you’ll need to stop automatic payments. It should only take a quick call or a click on an app. Normally, you can stop automatic payments by canceling the payment with the vendor. But even if a vendor doesn’t stop an automatic deduction from a bank account, you can give your bank a stop-payment order. Below you’ll find some common reasons to stop automatic payments and how to cancel autopay when you need to.
How automatic payments work
An automatic payment is a recurring payment. It’s used for paying utility and credit card bills, mortgages and any other recurring transactions you have. You can set up automatic payments through your bank or brokerage accounts or mutual funds.
An automatic deduction from a bank account makes it easy to never miss a payment or make a late payment. It helps you stay on top of recurring monthly bills and can help build a better credit score. You may save money, as some lenders give you a reduced interest rate if you set up an automatic deduction from your bank account.
Reasons to stop automatic payments
Although automatic payments have their benefits, there may come a time when you want to cancel them. Maybe you want to switch the bank account you use to make the payments, or maybe you want to reduce the automatic payment amounts. Here are some common reasons you want to stop automatic payments and how to cancel autopay.
Trying to cut back on spending
If you’re trying to cut back on spending, you may want to cancel some extra subscriptions on auto payments, like Netflix, Apple TV, Hulu, or Peacock subscriptions. Television subscriptions, news service subscriptions, magazine subscriptions, and other automatic payments for entertainment may be the first place to cut back.
Bills are becoming difficult to manage
If you have too many bills and risk an overdraft, it can be worth reducing the payment amounts or canceling some automatic payments. If your employer changes the payment date, you may also need to learn how to stop automatic payments or change automatic payment dates. If bills are becoming difficult to manage, it might be worth making a new plan or reprioritizing.
Shifting your repayment strategy
Maybe you want to switch your repayment strategy to another timeframe or make a lump-sum payment. If, for example, you want to repay credit card bills at once or take on a new debt repayment strategy like the avalanche or snowball method, you may need to stop automatic payments or change repayment amounts.
How to stop a recurring payment
If you need to stop a recurring payment, there are only a few steps to take.
Step 1: Contact the merchant or lender
First, you’ll need to contact the merchant or lender and ask them to stop automatic payments. You might have to ask them how to stop automatic payments as different merchants or lenders may require a written request, while others will allow a request by phone.
Step 2: Contact your bank
After contacting the merchant or lender, you may need to contact your bank and ask to stop automatic deductions from your bank account. Usually, the bank will verify your identity and cancel the payment requests. Some banks allow you to do this online or through their app.
Step 3: Request to stop the charges
If the charges haven’t stopped after contacting your merchant, lender, and bank, you’ll need to ask to stop them.
Step 4: Ask for a follow-up
When you contact the merchant, lender, or bank to stop automatic payments, you can ask for an email confirmation or other proof of cancellation.
Step 5: Keep an eye on your account
Be sure to keep an eye on your bank account and make sure that there aren’t any additional automatic payments made. If so, you may be able to dispute them or get a refund.
What to do if your payments are still not canceled
If your payments are withdrawn, you have more options. You can ask them how to stop automatic payments and request a refund. If a direct request to the vendor or bank fails, you can contact the Consumer Protection Bureau to submit a complaint. Remember, if you’ve made the request, the power is in your hands.
Contact your bank or credit card company
If your payments still aren’t canceled, the first step is to contact the bank or credit card company again. If you have an email or other confirmation of your initial request, you can reference this with your bank or credit card company.
Request a refund
If the charge was made after you asked to stop the automatic deduction from your bank account, you should have the right to request a refund. Keep in mind that sometimes companies or banks require a specific lead time to stop automatic payments.
Submit a complaint to the Consumer Financial Protection Bureau
If an automatic deduction from your bank account continues after you requested cancellation, you have the right to submit a complaint to the Consumer Financial Protection Bureau. This U.S. government agency is responsible for providing educational materials and supporting and protecting consumers. If your bank or lender doesn’t respond, you can submit your complaint here.
Final Thoughts on How to Cancel Auto Pay
Automatic payments are a convenient way to make on-time payments each month. It’s a streamlined system to avoid having to worry about every small payment. But if you’ve changed bank accounts, are cutting back on expenses, or want to shift your payment strategies, you should be able to stop automatic payments with a quick phone call or the click of a button.
FAQ
Can I tell my bank to block a transaction?
Yes, you can give your bank a stop-payment order that asks it to stop making a payment.
How do I cancel unwanted subscriptions?
You can cancel unwanted subscriptions directly with the merchant. If that doesn’t work, you can request your bank to stop payments to the merchant.
What are the disadvantages of automatic payment?
The disadvantages of automatic payments include the risk of overdrafts, especially if the automatic payment occurs before an expected deposit.
