Reasons to close Account
- You have not been a reliable customer
- You have been late on your payments
- You have not made enough deposits or withdrawals
- Your account has been inactive for a long period of time
If you notice any suspicious activity on your bank account, contact your bank immediately. If the bank has reason to believe that your account is linked to fraudulent behaviour, it may close or block the account. ..
If you have an excessive overdraft on your checking or savings account, it’s important to know the different policies of your bank. Some banks allow you to keep a negative balance for up to three months, while others may cancel your account if you have a negative balance for more than 30 days. If you’re banking with a company that charges high overdraft fees, it’s important to be aware of the risks involved and see if there are any ways to reduce those costs.
How to proceed if your bank account has been closed?
Your account has been closed because your bank is not required to notify you of impending account termination.
If you have any questions, or if your bank closes your account without giving a reason, you can contact the Consumer Financial Protection Bureau. The bureau is a government agency that helps people who have been hurt by financial products and services. ..
To find out which banks reported your account and why to examine your ChexSystems report next. ChexSystems is a firm that gathers and keeps track of the details on your bank accounts. Your ChexSystems keeps records of missed payments, returned checks, unpaid debts, and insufficient funds for up to five years. If the bank terminates your account and you’re not sure why you can pull your ChexSystems report to see if it has the details you need.
Steps for opening a bank account that has been closed
A closed account that is not active or has a negative balance can be reactivated more easily than an account that is inactive or has a positive balance.
If a bank account is closed because of an irregular or unauthorized use, several measures may need to be taken to reopen it. However, as soon as you learn that the account is closed, you should get going as the banks can charge off the loan within 60 days as required by the law.
Reactivate a bank account that was closed for inactivity
If you have a dormant account at a bank, you can often reactivate it by performing a direct deposit within a certain timeframe. Some banks will demand that you submit a request before they will reopen the account. A direct deposit must be submitted with that request. Other banks will reopen the account when you make a withdrawal rather than a deposit.
reactivating an account usually only requires one transaction. Check the terms and conditions of your bank before opening a dormant account, though, as there can be a minimum deposit requirement.
Reactivate a bank account that had been closed off for fraud
If your bank observes questionable or fraudulent activity on your account, it will report it to the Department of Treasury. This will stop you from being able to reopen the account with other banks. ..
The best part of having a fraud-free account is that before the bank flags it, you’ll know. By demonstrating that all deposits are authentic and no transactions are connected to fraud, you might be able to prevent the closure completely. However, if the bank determines that you are a high-risk account holder, they still maintain the right to close your account.
Reactivate a bank cancel account due to an outstanding negative balance
The bank’s policy completely governs your eligibility to reactivate a bank account that has been closed due to a sustained negative balance. Nevertheless, the bank often agrees to let you reopen the account in exchange for payment of the negative balance, all overdraft fees, and the transaction costs associated with each item that bounced.
If your bank closes your account because you have had too many overdrafts and a negative balance, you may be able to reopen it if you can prove that you will not overdraw again. However, you will still be responsible for the remaining balance and all related charges. If the bank notifies a credit bureau about your account, your credit score may suffer and it will be difficult for you to get a bank account with other institutions in the future. ..
Conclusion
If an account is closed by either you or the bank, the account may be closed for a variety of reasons, including but not limited to: if the account is inactive or if it has been used in violation of bank policies. Get in touch with your financial institution to find out more about possible options to keep your account open and get it back in good standing.
