Personal Finance Banking Checking Account
Written by Sophia Acevedo, CEPF; edited by Laura Grace Tarpley
Updated
2024-04-24T21:35:10Z
- What is a bounced check?
- Consequences for the check issuer
- Consequences for the recipient
- How to avoid bouncing checks
- FAQs
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- Checks bounce if you don't have enough money in your account or there's an error.
- If you've sent a bounced check by accident, you'll need to send a new check or pay online.
- If you've received a bounced check, contact the person who gave you the check about the error.
When a bank returns a check, it's an unfortunate setback but not too difficult to resolve. If you've received or accidentally sent a bounced check, we'll explain why it usually happens and the steps you can take to fix it.
What is a bounced check?
A bounced check occurs when a check can't be processed by a bank. Here are a few of the most common reasons why checks bounce:
- The person may have written the check incorrectly by putting the wrong date or writing the wrong check amount.
- The account belonging to either the payee or payor has been closed.
- There aren't enough funds in the payor's bank account to cover the amount listed.
- The payee holds onto the check for too long. Checks have an expiration date at which point they become void.
Consequences for the check issuer
Returned check fees
Financial institutions may charge a returned check fee to a bank account if there aren't enough funds to cover a check. Fees may vary from $10 to $36, depending on the financial institution.
Bank fees
Some institutions also charge a non-sufficient funds fee or overdraft fee if a check bounces, though these types of fees are becoming less common.
Some brick-and-mortar banks are also beginning to waive fees on returned checks. For instance, Wells Fargo and Bank of America no longer charge you for bouncing a check.
Service provider fees
If you send a check to pay for a monthly bill and it bounces, you also might have to pay a late payment fee if the due date has passed.
Legal implications
Some states consider a bounced check a criminal offense if the payor was aware of insufficient funds in their account to cover the deposit.
Consequences for the recipient
Delayed payment
If you've received a bounced check, you'll have to contact the person and let them know the check has bounced. On their end, they'll have to write a new check and sent it.
Fund reversal
If you deposited a check and the funds were made available to you before the check cleared, a bank may reverse the deposit if the check bounces and ask you to repay any funds that were spent.
How to avoid bouncing checks
A bounced check is inconvenient for everyone involved. Avoiding sending a bad check by monitoring your account, either manually or by setting up account alerts so you're notified when your balance is low.
You may also consider using certified checks or cashier's checks to guarantee the funds remain available in your account long enough for the check to clear.
Other options include wire transfers or online payment apps, which offer near-instant payments, or money orders, which are essentially prepaid checks.
Bounced check FAQs
What exactly is a bounced check?
A bounced check is a check that cannot be deposited by the recipient's bank.
Why do checks bounce?
Checks often bounce due to insufficient funds in the payor's account, a mistake in how the check was written, or a closed account.
What fees are associated with a bounced check?
The most common bank fees imposed on the check issuer, or payor, include non-sufficient funds fees, overdraft fees, and returned check fees.
How can bouncing a check impact the issuer legally?
Issuing a bad check can have legal implications depending on state laws. Repeatedly and knowingly issuing bounced checks can lead to a suspicion of fraud.
What are some effective strategies to prevent bouncing checks?
Prevent bounced checks by regularly monitoring your account balance through bank alerts and using alternative payment methods, such as online payment apps, money orders, certified checks, or cashier's checks.
Banking Editor
Sophia Acevedo is a banking editor at Business Insider. She edits and writes bank reviews, banking guides, and banking and savings articles for the Personal Finance Insider team. She is also a Certified Educator in Personal Finance (CEPF).Sophia joined Business Insider in July 2021. Sophia is an alumna of California State University Fullerton, where she studied journalism and minored in political science. She is based in Southern California.You can reach out to her on Twitter at @sophieacvdo or email sacevedo@businessinsider.com.Read more about how Personal Finance Insider chooses, rates, and covers financial products and services >>Below are links to some of her most popular stories:
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