What Happens with Bad Personal Checks?

Writing checks

When you pass a bad personal check, you do not save yourself any time or money. All Business defines a bad check as "any check dishonored, for wrong endorsement, lack of endorsement, insufficient funds, account closed and so on." With bank fees for overdraft personal checks increasing each year, writing a bad check can seriously hurt your budget and your personal credit with businesses that accept checks as payment.

Chance to Correct

In most cases, you will be given a chance to make the check good. You may do this by adding money to your bank account and letting the payee run the check through again. Another option is to pay the amount of the check directly to the payee and request the paper check in return. There is a time limit for giving the money to the payee. For example, the first step in the process of recovering bad personal checks in Los Angeles County is giving the payer 10 days to make good on the check.

Fees from Payee

Whether you give the payee her money immediately or not, she will likely demand you pay a service charge. The amount she is able to charge differs from state to state. The National Check Fraud Center keeps a listing of bad check penalties payees are allowed to charge in different states.

Bank Fees

Bank fees for overdraft personal checks are getting higher each year, according to Bank Rate. Banks not only charged more in 2009 than in 2008, but they also charged more for serial check bouncers. In other words, if you bounce more than one check within a 12-month period, expect to pay more per instance.

Check Writing Classes

County offices across the country are implementing bad check restitution programs. The one in Los Angeles County requires bad check writers to attend classes designed to help them avoid the problem in the future. They learn new behaviors and avoid criminal prosecution if they meet all the requirements of the program.

Criminal Charges

There can possibly be criminal charges in cases where bad personal checks are passed. The laws vary, and enforcement is not always considered as important as recovering the funds promised by the check. The National Check Fraud Center has a listing of bad check laws in different states, although it is not guaranteed to be up to date. It is a starting point for information on criminal consequences of writing bad checks.

References

• All Business: Business Glossary: Bad Check
• Los Angeles County: Bad Check Restitution Program
• Bank Rate: Bounced Checks-Fees Rise Again

Resources

• National Check Fraud Center: Check Service Charge by State
• National Check Fraud Center: Bad Check Laws by States
• Bounced Checks: What to Do If You Write Them...Or Receive Them