Introduction
Steps to Take When a Check Bounces in the United States | A bounced check can cause stress for both individuals and businesses. Whether you’re a landlord, business owner, or service provider, receiving a bad check disrupts your operations and cash flow. Fortunately, the United States has clear processes and legal frameworks that help you handle such incidents effectively.
This comprehensive guide outlines the exact steps you should take when a check bounces in the U.S., including legal, financial, and preventative measures.
1. Confirm the Check Has Actually Bounced
Before taking any action, verify with your bank that the check has officially not cleared. There could be a temporary issue such as a hold or a delay in processing.
How to Confirm:
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Check your bank account statement.
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Ask your bank for the reason code for the returned check (e.g., NSF, closed account).
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Request a copy of the bounced check and any notices received.
2. Review Your Bank’s Bounced Check Policy
Most banks charge a returned deposit fee, often between $10 and $35, when a check bounces. Some may attempt to redeposit the check automatically.
Things to Check:
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Whether the check was redeposited already
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Whether fees were applied to your account
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Whether the bank notifies you via email, text, or letter
Knowing this will help you decide how quickly to act.
3. Contact the Check Writer Immediately
Reach out to the person or business that issued the check. Keep the communication professional, polite, and solution-oriented, as many bounced checks are due to simple errors or timing issues.
Suggested Contact Methods:
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Phone call
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Email
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Text message
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Certified letter (especially if prior attempts fail)
Key Things to Say:
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Inform them the check bounced and provide a copy of the bank notice.
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Ask for repayment in a different form (cash, cashier’s check, money order).
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Set a clear deadline for payment (usually 7 to 10 business days).
4. Send a Written Demand for Payment
If informal efforts don’t work, send a formal demand letter. Many U.S. states require this step before legal action is taken.
What to Include:
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The check amount and date issued
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Reason it was returned
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Request for full payment plus any fees
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A deadline (varies by state, typically 10–30 days)
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Statement of intent to pursue legal action if unpaid
Send via certified mail with a return receipt so you have proof of delivery.
5. Reprocess the Check (If Appropriate)
If the check was returned for non-sufficient funds (NSF), you may ask your bank to redeposit it. Only do this after confirming the check writer has enough funds.
Do not redeposit checks marked:
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“Account Closed”
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“Payment Stopped”
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“Refer to Maker”
These suggest intentional fraud or stop-payment actions and require legal escalation.
6. Charge a Returned Check Fee (If Allowed)
Many states allow businesses and individuals to charge a returned check fee. You must disclose this policy in advance—either on a posted notice, contract, invoice, or payment receipt.
Typical Fees Allowed:
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California: Up to $25
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Florida: Up to $40 or 5% of the check amount
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Texas: Up to $30
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Illinois: Up to $25 plus court costs
Make sure your fee policy is visible and legally compliant.
7. Consider Legal Action
If you’ve followed all steps and still haven’t been paid, legal recourse may be necessary.
A. Small Claims Court
This is the most common route for collecting unpaid checks. You can recover:
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Original check amount
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Bank fees
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Statutory damages (up to 3x the check value in some states)
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Filing and court costs
B. Criminal Complaint
If the check was issued with intent to defraud, you can report it to:
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Local law enforcement
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District Attorney’s Office
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State Attorney General
This can lead to criminal penalties, especially if the check was for a large amount or written on a closed account.
8. Use a Check Recovery or Diversion Program
Many U.S. counties and states offer bad check diversion programs. These programs:
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Help collect money from bad check writers
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Educate offenders to prevent future issues
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Allow you to recover full restitution plus fees without hiring a lawyer
Check with your local District Attorney’s office to see if a program exists in your area.
9. Document Everything
Create a file for each bounced check you receive. Include:
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Copy of the original check
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Bank’s returned check notice
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Copies of all communications
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Proof of delivery for the demand letter
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Any payment attempts
Documentation is essential if you take legal action or use a collection agency.
10. Implement Preventative Policies
Once you’ve dealt with the immediate issue, prevent future ones by updating your check acceptance procedures.
Suggestions:
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Post your returned check policy
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Only accept checks with matching ID
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Use check verification services
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Set limits on check payments (e.g., no checks over $500)
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Encourage digital payment options like Zelle, ACH, or credit cards
Bonus Tip: Consider a Civil Compromise (When Applicable)
If the check writer is willing to cooperate but needs time, consider setting up a written repayment agreement. This shows good faith and can help avoid court.
Conclusion
When a check bounces in the United States, don’t panic—but don’t ignore it either. Acting promptly and professionally can help you recover your money and protect your rights. Whether you choose to resolve it privately, pursue small claims, or escalate legally, following the right steps ensures that you’re covered by law and prepared for any outcome.
