Bad checks can be the result of a simple oversight, poor bookkeeping or unexpected charges that come through at just the wrong time. Once you realize you've made a mistake and your check has bounced, there are simple ways to make good on the error and fix the problem before it grows into something more.
Pay the Debt
The amount of time that businesses or individuals must grant to a person who has issued a bad check to make good varies from state to state. Ten days is a typical limit that must be followed to avoid civil charges and the added expenses of a possible lawsuit. The amount for which victims of a bounced check can sue also varies but it can go as high as 300 percent of the amount of the check. If you are notified that a check of yours has bounced, make every effort to pay the debt in full within the local legal time limit or you risk greater penalties in many cases.
Pay the Fees
If a check bounces, the fees and penalties issued can add up quickly. Banks are the first to bill for the overdraft, with fees typically ranging from $25 to $35 per infraction. The business that received the check and attempted to cash it will also likely bill you its own fee of $25 to $35. If you are in good standing with your bank and have never bounced a check before, they may be willing to waive the fee and allow you to carry on business as usual. If the bank manager is at all helpful he she will likely extend the one-time courtesy. If not, pay the fines to bring your account up to a zero or positive balance.
Fix Your Credit
Contact one of the seven nationwide check verification companies to inquire about the effect of your bad check on your credit rating. These companies serve a similar purpose as the big three credit agencies, but they only deal with checks. If the incident has been reported, ask how you may be able to improve your score in response to it. Once you have paid the debt, contact the company that reported you and ask them to remove the complaint by explaining how it will affect your credit in the future.
Checks bounce from time to time because of innocent miscalculations or errors in accounting. This is an accepted part of doing business and is easy enough to fix. When a bad check is written with or without the intent to defraud, it can become a legal matter. Fraudulent checks written with intent for small amounts are treated as misdemeanors in many states and can lead to fines and/or jail time depending on the case. Checks which have been purposely written for large amounts with no intent to pay can be categorized as felonies and lead to more significant punishment. Ignoring a bounced check -- no matter how small -- can result in "theft by check" charges even if there was no original intent to defraud. As a result you can be treated as though you had stolen the merchandise or service outright. In addition, you will be liable for the legal and collection expenses attached to the case.
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