can bank take money out for own loan without permission?

karimkandi · #1 May 17, 2007, 01:26 PM

I have business checking and personal checking with one bank. I had line of credit for business with personal guarranty. they took out past due payment out from my personal checking and they said they can do it by loan aggrement. but they did not notify me in addvance and they took whatever there was and my checks are boncing now . can they do that? where is costumer protaction act and rights?.

ebaines · May 17, 2007, 01:32 PM

Excuse me, but you agreed that they can take money from your personal account if you default on a business line of credit, correct? You then missed a payment (which you must have known about), so per the agreement they took the money from your personal account. Seems proper to me. Did you not have any way of knowing that you were past due on the business LOC?

Lowtax4eva · May 17, 2007, 01:36 PM

I would have to think that a bank, especially a large well known one, would know what it's doing. Go over the documents for this line of credit, there must be a document stating that if a payment is missed your "personal guarantee" is that you will cover the late payments from your personal account.

Again, i doubt they are doing anything illegal, if your not sure demand to see something you signed authorizing them to deduct payments from your personal account.

DrJ · May 17, 2007, 01:40 PM

if it is written into your agreement, then yes, they can. It is called a Cross Collateralization Clause.

mr.yet · May 17, 2007, 01:49 PM

Is the business account corporate???



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