What is a Pre-Authorized Debit and Payors Agreement?
Pay your bills the hassle-free way.
2 min read
As a renter, there is no worse feeling than when you realize you forgot to meet the deadline for your monthly bill payments. What if we told you that there was a way to make payments on time, without even signing the cheque? A pre-authorized debit and payors agreement (PAD) allows you to do just that without having to think twice.
It’s simple- the agreement allows the biller to withdraw money directly from your bank account when a payment is due.
To set up the pre-authorized agreement, you must give documented permission to your financial institution, as well as the biller, to make withdrawals directly from your account. Your banking information, as well as a blank check, must be provided to your financial institution. The agreement should include the pre-authorized amount and frequency of payment.
When using a pre-authorized debit agreement, always consider:
To read and acknowledge the terms and conditions before signing the agreement
Keep a copy of the signed agreement or confirmation of the pre-authorized debit
Inform any merchants or financial institutions of a change in your banking information
Check your bank account regularly to make sure the withdrawals match the agreement
Inform your financial institution of incorrect or unauthorized debits within 90 days of the withdrawal
Signing a PAD agreement not only leaves you worry-free, but it allows you to save time and money as well. Forget about making trips to the bank, incurring late payment charges and missing your payment due date. Make your payments with ease with a pre-authorized debit and payors agreement.
Reference
Canada, F. (2017, November 30). Government of Canada. Retrieved March 12, 2021, from https://www.canada.ca/en/financial-consumer-agency/services/banking/preauthorized-debit.html
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