Can I Close Out My Checking Account If I Have a Negative Balance?

The economy has everyone running and looking for cover. Everyone has felt the sting of the recession in one way or another or you know of someone who has. During tough economic times it seems like our money just seems to disappear into thin air especially when you are trying to keep the balance in your checking account positive.

All too often a checking account balance will fall into the negative because we had some expenses we could not account for. Maybe you had some payments that were automatically deducted but you forgot about them. In the past, when you had plenty of money in your account it wasn't a primary concern but now when money is tight you have to keep an eye on them.

Every so often we send out a check to a creditor thinking that we will be able to cover only to fall short and you wind up with a host of fees. Your checking account can really start to accumulate a really large negative balance.

In an effort to stop the account balance from going even further into the red some people have gone to the bank to close the account. They are really disappointed when they find out that they cannot close the account until they make a deposit large enough to get rid of the negative balance and bring the account into a positive standing once again.

If funds are low this becomes nearly impossible before some of the other automatic payments come out. There will probably be a number of things you can do. First you may want to see if you have money from a short term source that you have access to. If you gain access to the funds and make a deposit that would really help your situation. You may want to try a credit card. If you get a cash advance this will be an extremely costly way to get funds because the interest rate will be very high and in most cases it will be higher than 20%. There will also be a cash advance fee as well.

If you have a friend that you can borrow from that would also solve the problem. When you have two accounts at one bank you can also have the money transferred from one account to the other.

Later on after you resolve your problem you may want to apply for overdraft protection. This is a credit product so you do have to apply for it. The rate of interest on this type of account is somewhere in the area of 18% to 19%, which is very high.

When everything is said and done you will need to get rid of the negative balance before you close your checking account no matter which method you use to obtain your funds.