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#1394908 - 05/21/10 09:39 PM Mail Letter When Charged Off?
complofcr Offline
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Joined: Apr 2010
Posts: 181
SE USA
Is the bank required to send a letter to the customer informing them that we have charged off their checking account due to being overdrawn for 30 days? We send several letters over the course of 30 days & the last one at 25 days states that the account will be closed at 30 days if it's not brought back to a positive balance.

What Reg would this be under?

Thanks!

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#1394916 - 05/21/10 09:51 PM Re: Mail Letter When Charged Off? complofcr
Kathleen O. Blanchard Offline

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Kathleen O. Blanchard
Joined: Dec 2000
Posts: 21,281
You should not tell them you have charged off the checking account, that could lead them to believe they do not owe the money. Charging off is an accounting transaction for the bank...it has nothing to do with the customer unless you reach a point where a 1099-C is in order.

Notify them about the funds owed the bank and that the account will be closed.
_________________________
Kathleen O. Blanchard, CRCM "Kaybee"
HMDA/CRA Training/Consulting/Mapping
The HMDA Academy
www.kaybeescomplianceinsights.com

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#1394937 - 05/21/10 10:18 PM Re: Mail Letter When Charged Off? Kathleen O. Blanchard
complofcr Offline
100 Club
Joined: Apr 2010
Posts: 181
SE USA
I'm sorry, our letter actually says that we have closed the account not charged off. But, are we even required to send that letter? Our customer service was thinking this would save money - time, postage, paper, envelopes, etc. - if we didn't have to send the final letter & could just send those over the 30 days.

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#1394965 - 05/22/10 01:34 AM Re: Mail Letter When Charged Off? complofcr
Kathleen O. Blanchard Offline

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Kathleen O. Blanchard
Joined: Dec 2000
Posts: 21,281
Normally you can just send a letter giving notice of closing the account - the amount of notice depends upon what you have promised in your account agreement, but for misuse the bank usually reserves the right to close without notice.

Since you are trying to collect, a series of letters seems to make sense. You can of course continue collection efforts after closing the account if the $ are worth it.

Don't spend more than they owe you.
_________________________
Kathleen O. Blanchard, CRCM "Kaybee"
HMDA/CRA Training/Consulting/Mapping
The HMDA Academy
www.kaybeescomplianceinsights.com

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#1394985 - 05/22/10 05:04 PM Re: Mail Letter When Charged Off? Kathleen O. Blanchard
cbinder63 Offline

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cbinder63
Joined: Dec 2001
Posts: 674
Colorado
Do not forget that you will also have a final account statement cycling. This should reinforce that the account is closed.
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Opinions expressed are my own.

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