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Moving a Checking Account While Payments and Deposits Are Still Active

This guide presents selected U.S. government consumer education from CFPB. References to “we” or “us” in the source material refer to the issuing agency. Source dates and links appear below.

What is the best way to move my checking account to another bank or credit union?

When moving your checking account to a new bank or credit union, open the new account first and update any automatic transactions, direct deposit, or payment paperwork.

If you decide to move your checking account to another bank or credit union, follow these steps for a smooth transition:

  1. Open the new account first.
  2. Make a list of all the automatic deposits and withdrawals scheduled to go in and out of your old account each month. Be sure to include any bills you have authorized to be paid directly from your checking account, such as utility or credit card payments.
  3. If you have direct deposit, fill out the forms directing your employer to reroute your paychecks to your new account. Do the same for any other direct deposit, such as Social Security payments.
  4. Find out when your direct deposits will transfer. Once you know the date of the first direct deposit, arrange for your automatic debits and withdrawals to be made from your new account and be sure to cancel them from your old account.
  5. Leave enough money in your old checking account to cover any checks that haven’t cleared or automatic payments that haven’t been made to avoid any fees.
  6. Once you’re certain all direct deposits and automatic payments are coming into and going out of your new account, transfer the remaining funds from your old checking account into your new account. You can do this fastest electronically or by using a cashier’s check. Using a personal check may be cheaper than using a cashier’s check, but there may be a longer wait before it is available in your new account.
  7. Once the transfer clears your new account, close the old account. Get written confirmation from your old bank or credit union that the account has been closed.

Moving your checking account

Moving your checking account? This checklist gives you tips for avoiding accidental bounced checks and other possible disruptions.

Considering changing checking accounts?

Shop around

Compare account services online or by visiting bank and credit union branches near you. Also find out if you need to make a minimum deposit and how much that would be.

Compare fees

Ask for a list of your current account’s fees. Then compare them to what you’d pay at other banks or credit unions you’re considering. Also inquire about ways to avoid fees, such as by maintaining a minimum balance or setting up direct deposit.

Consider convenience

How many ATM locations and branches are available? When are they open? Are they close to where you live, work, and shop? Does the bank or credit union offer online or mobile banking? Does it have a good customer service reputation?

Open the new account

Ask the bank or credit union what identification it accepts or requires to open the account.

Steps to take in changing your checking account

List your automatic payments and deposits

Be sure to include all the automatic deposits and withdrawals that go in and out of your old account each month.

Change direct deposit

If you have direct deposit, fill out the paperwork from your employer or other payment source to reroute your deposits to your new account.

Find out the date your direct deposits will transfer

Once you know the date of the first direct deposit, make arrangements for your automatic debits and withdrawals to be made from your new account starting after that date. Then cancel the automatic debit from your old account so that your bill is not accidentally paid twice.

Leave some money in your old account

Leave enough to cover any checks that haven’t cleared or automatic payments that haven’t taken place. This helps you avoid overdrafts, fees for dipping below your minimum balance, or having checks or debits returned.

Transfer your remaining funds

Once all direct deposits and automatic payments are coming in and out of your new account, transfer the remaining money from your old checking account. To do this, you can write a check, transfer the money electronically, or use a cashier’s check.

Close the old account

Ask for written confirmation when the old account is closed.

Can I close my account whenever I want?

Most of the time, yes, but your bank or credit union may require you to settle your balance before allowing you to close an account that is overdrawn.

If you want to close your account, you should call your bank or credit union or go in person and give them your account information.

Once you have made a request, state law generally requires banks or credit unions to close your account in a reasonable amount of time. Be careful when closing accounts to make sure you have no outstanding or pending checks, fees, or automatic payments, because causing these to bounce may result in fees and affect your ability to open another checking account in the future.

Some banks or credit unions may charge a fee if you close your account shortly after opening it. You should check whether your bank or credit union charges such a fee.

The bank/credit union closed my checking account even though I did not want them to. Can the bank/credit union do that?

Yes, a bank or credit union can close your account without your permission.

A bank or credit union is most likely to do this if you have written bad checks or don’t have enough in your account to cover your fees. Banks and credit unions may also close dormant accounts for which there has been no activity for a substantial period of time (generally years). Some states may require your bank or credit union to give you notice before it closes your account.

I closed my interest-bearing account, but the bank/credit union did not pay me interest up until the day I withdrew the money. Why?

If you closed the account before the bank or credit union credited the interest, generally the bank or credit union won’t pay that interest. This is known as “forfeiture of interest.”

However, the bank or credit union must disclose this policy in the account agreement you received when you opened the account. To find out your bank or credit union's policy, review your account agreement or ask your bank or credit union.

What is an ACH transaction?

An ACH transaction is an electronic money transfer made between banks and credit unions across a network called the Automated Clearing House (ACH).

ACH is used for all kinds of money transfers, including direct deposit of paychecks and monthly debits for routine payments. Businesses often allow you to pay bills via ACH by providing your account number and bank routing number. Some online payment services also conduct transactions via ACH, including online bill payment services through banks and credit unions.

Are ACH payments faster than other payment types?

It’s possible for ACH payments to clear quickly, even on the same day they are entered, on business days during business hours. That might not mean a transaction you make through ACH is completed on the same day you enter it. Because of the way ACH transactions are processed and because the network must guard against fraud and money laundering, payments can take days to complete.

Your bank or credit union might have a limit on the amount you can transfer, and they might charge you a fee for each transaction. ACH transactions can “bounce,” or be returned for nonpayment, if there is not enough money in the account.

Sources and publication details

The federal agency source text is U.S. government work in the public domain. Fynoptic selected, adapted, and formatted it for this guide. No agency endorsement is implied. Follow the linked sources for current program details and the rules applicable to your circumstances.

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