An automatic bill payment is a money transfer schedule on a predetermined date to pay a recurring bill such as a homeowner association fee. These payments can be arranged by the owner of a checking account held at a commercial bank or credit union. The date of transfer can be selected by the account holder in order to avoid the possibility of late charges.

The advantage of automatic bill payment, as opposed to ACH (Automatic Clearing House) payment arrangements, is that the party collecting the funds is never given authority to access the account holder's bank or savings account. Thus, automatic bill payment is more secure than ACH arrangements.

Payment of Assessments - Methods