stopping automatic collection withdrawals?

[tbg95]

I have three accounts in collections, one account past due but still with the company. On my one collection I agreed over the phone to a repayment plan, but I think I got too nervous and agreed to more than I can afford, let alone if I attempted to pay back my other debts as well.

I've decided to probably file bankruptcy (I have a free consultation this coming week). I've been reading, but still need to learn more. I know that if I file there will be an automatic stay on the collections to prevent them from going to court, but will it affect the one that is taking payments automatically out of my checking? They told me that I cannot stop this or change the amount, so I was wondering...I'm planning on asking during my consulation about it, but truthfully if I can't stop it I'm not sure how I'll afford bankruptcy, even if I file on my own without an attorny.

Thanks.

[SinkingFast]

If you aren't in Chex Systems or there's no other reason stopping you from opening a new acct, I'd change banks if it were me. Just go to another bank, open a new acct, and close this old one.

If you have Direct Deposit, or something like that where you can't change on a moment's notice, then contact your bank immediately. Tell them this Creditor is gonna attempt an unauthorized withdrawal from your acct. See if your bank can stop funds from leaving your acct on their end.

Also, send the Creditor a Cease and Desist letter. Tell them you are retracting your authorization they coerced you into during your phone conversation to auto debit your bank acct, effective immediately. Send the letter, USPS, Signature Required, Registered Mail. Make the Creditor sign that they got your C&D letter. Create a paper trail.

Once you file BK, an Automatic Stay goes into effect. Creditors HAVE to cease all collections activities. If they don't, they're breaking the law.

[almostthere]

Once you file BK, an Automatic Stay goes into effect. Creditors HAVE to cease all collections activities. If they don't, they're breaking the law.

Just to add on since I had a similar problem, creditors may give you garbage about not receiving official notice (even though verbally informing creditors over the phone is considered sufficiant notification according to the court after mailing of BK/341 notice) about your BK and continue to attempt automatic withdrawls. Of course you could sue them for this but who needs the extra headaches? SinkingFast is absolutely right, the only way to avoid this is to open another bank account (preferably in another bank) and conduct your monthly business from there.

Although there may be a bad aftertaste since you just made payment arrangements with a company, spend that money for a good BK attorney if you can. Payment plans don't work. I tried to follow through one with Discover prior to filing, and I realized that my obligations were still way too big even though they sounded reasonable over the phone.

[jal1129]

Try calling the creditor first and seeing if they will stop. I had the same thing happen to me. I had called and set up payment plans for past due creditors, one required automatic payments. Shortly after that my husband was in an accident and unable to work for several months, so I knew we would have to file bk. I called the creditor up and they were not very happy but they did stop the deductions.

If that does'nt work than I would do as sinking suggested and go to your bank and see if they can decline it on thier end and/or change banks.