Cross Collaterization

[danaf]

I just want to make sure I'm not gonna screw myself.

I have a car loan with a credit union. The caveat to getting a lower interest payment was they have to take the payment from my checking account. No prob. I intend to keep the car but not sure if I will sign a reaffirmation agreement.

But, I've got my entire paycheck going into this checking account.

Knowing how bad credit unions can be, I went and opened up a new checking account at a new bank. Ideally what I'd like to do is have my direct depost going into the new bank, and then set up my credit union checking account as a bill pay so the amount for the car will always be there when they draw on it. It would be a total hassle to have to go and physically deposit the $$$.

OK - so my question is - if I set it up this way, is there any way the credit union can draw on money from my new bank account without my authorization? They shouldn't do this since they will be paid ontime but I just don't trust credit unions where it concerns bk. AND - I'm thinking back to posts I've read where people had cc banks on automatic payments from their bank accounts and the cc's went in and drew out money....I don't remember exactly but just need to be sure I'm not screwing myself.

thanks

[epiphany]

I just want to make sure I'm not gonna screw myself.

I have a car loan with a credit union. The caveat to getting a lower interest payment was they have to take the payment from my checking account. No prob. I intend to keep the car but not sure if I will sign a reaffirmation agreement.

But, I've got my entire paycheck going into this checking account.

Knowing how bad credit unions can be, I went and opened up a new checking account at a new bank. Ideally what I'd like to do is have my direct depost going into the new bank, and then set up my credit union checking account as a bill pay so the amount for the car will always be there when they draw on it. It would be a total hassle to have to go and physically deposit the $$$.

OK - so my question is - if I set it up this way, is there any way the credit union can draw on money from my new bank account without my authorization? They shouldn't do this since they will be paid ontime but I just don't trust credit unions where it concerns bk. AND - I'm thinking back to posts I've read where people had cc banks on automatic payments from their bank accounts and the cc's went in and drew out money....I don't remember exactly but just need to be sure I'm not screwing myself.

thanks

Hmmmm, dunno the answer to this but understand your concern. However, there may be another option.

I don't do this but know that my payroll gives me the option of depositing different payments/amounts into two financial institutions and up to three accounts. It is possible that you could just have the amount that is necessary for your car payment direct deposited into that account and have the rest direct deposited into your new account. You should check with your company's payroll.

ep

[danaf]

I did check that already and they don't offer it. :-(

[sharksfan]

You may be forced to pay the higher rate (IE no automatic withdrawl) to keep the car. My CU said that I can no longer have any services through them if we caused them a loss (didn't reaffirm everything). We are looking into reaffirming only a couple of items and set them up as a payee through our new banks bill pay service.