Can a bank take my child support payments to pay off an outstanding account? Not only did my bank do this, I was charged four overdraft charges for outstanding items. Is this legal?
Assuming that your reference to "an outstanding account" is to a past-due debt you owed to the bank, in many states, if a bank holds a loan or other debt owed by a person for whom the bank also holds a deposit account, the bank is able to use a "right of offset" to apply the funds in the deposit account toward the delinquent debt. Under those circumstances, and assuming the bank sent you any notice of its action that's required in your state, the bank would have the right to assess overdraft charges for items that were later presented for payment against insufficient funds.
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Assuming that your reference to "an outstanding account" is to a past-due debt you owed to the bank, in many states, if a bank holds a loan or other debt owed by a person for whom the bank also holds a deposit account, the bank is able to use a "right of offset" to apply the funds in the deposit account toward the delinquent debt. Under those circumstances, and assuming the bank sent you any notice of its action that's required in your state, the bank would have the right to assess overdraft charges for items that were later presented for payment against insufficient funds.
