Cancellation Letter of Stop Payment Order

There are many situations in which an account holder is required to stop payment on a check either permanently or for a specific period of time. Usually when an account holder puts a stop payment order on a check, the order is made via phone initially and then the account holder is asked to visit the bank in order to make it permanent. Depending on each bank, the stop payment order can last for up to 6 months. In order to remove the stop payment order on a check and allow the bank to honor the check, the account holder is again required to make a formal request with the bank and inform them that now they can cash the check if it comes in the bank. This is done by sending the formal letter of cancellation of stop payment order.

Importance, uses and purposes of Cancellation of Stop Payment Order:

Suppose that you issued a check a week ago and suddenly when you balance you accounts and books, you find out that there is not enough cash in the account and if the check goes for clearance, it will be dishonored by the bank. In this case, you need to inform the bank to stop payment on the order so that if the check is dishonored, the check holder can’t take legal action against you. Once, you verify that there is enough cash in your account; you need to cancel the stop payment request so that the check holder can visit the bank and cash the check.

Another situation is when you sign a check and someone you lose it either by your mistake or when you send it to someone via mail, the other person doesn’t receive it and you want to stop the payment on the check until it’s found. As soon you find the check or the other person receives it by mail, you should cancel the stop payment order on that check and inform the bank. Usually when it comes to stopping payment on a check or cancelling the stop payment order, all banks have formal request application on which you can just put the details and send it to the bank. You can find these forms from the official website of your bank.

Key elements to include in the Cancellation of Stop Payment Order:

  • Name of the account holder who is sending the order to the bank with complete address
  • Name of the bank with branch name, branch code and complete address
  • Details of the account with account type and other particulars
  • Details of the check on which the individual put a stop payment order earlier
  • Reasons why the account holder put a stop payment order on the check earlier
  • Date when the stop payment order was placed on the check
  • Date when the cancellation order is being sent to the bank
  • Reasons why the account holder now wants to cancel the stop payment order
  • Signature of the account holder

Here is preview of a Free Sample Cancellation Letter of Stop Payment Order created as fillable PDF Form,

Cancellation Letter of Stop Payment Order

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