Is it legal for a finance company to take out a payment before the agreed upon payment date?

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Is it legal for a finance company to take out a payment before the agreed upon payment date?

We have been having trouble with a finance company. If the mail is slow and they receive their payment a day after the agreed upon date they call and harass us. We started sending out the payment extra early with check dated for the agreed upon date and now they feel free to take the payment out of our bank early?

Asked on January 13, 2012 under Bankruptcy Law, Minnesota

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

You are not allowed to post-date a check, or to date it for a date in the future (even if it's only a few days in the future), unless the other side specifically agrees to it. Otherwise, they may deposit a check when they receive it. It is your responsibility to manage your budget: you have to make sure that you have sufficient money to cover the payment when the finance company receives it, while mailing it with sufficient time to make sure they get it on time.


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