How Many Times Can One Check Bounce?
Rachel* wrote a check for $25.00 and it bounced. The next day, it bounced again. Both times she was hit with a $33.00 “returned item” fee. I called U.S. Bank on Rachel’s behalf and was told the check would continue to bounce every time it was “presented for payment” by the payee. According to the bank’s rep, the only way to prevent additional “returned item” fees on the check was to a) pay U.S. Bank $30.00 to stop payment on the check, or b) get the payee to stop trying to cash the check.
I called the payee, which happened to be the Minnesota courts, and they agreed to pull the check and accept payment from another source (and paid over the phone). Because the check bounced twice, though, the court assessed a $30.00 penalty. In total, her $25.00 check cost her $96.00 in fees. Ouch.
Had Rachel paid her court fine over the phone or online, she could have avoided the $96.00 in fees. When you pay by check, there is a lag time between when you mail it and when it’s deposited by the payee. For some people, like Rachel, that lag time is long enough to forget you wrote the check in the first place. An online or phone payment would have been processed more quickly, when the money was still in her account. Yes you may have to pay a small fee when you pay by phone or online, but it’s cheaper than $96.00.
The best solution, of course, is to balance your checkbook regularly so you always know your account balance. There’s the plain ol’ check register that comes with your checks, but you can also use an Excel spreadsheet or any other method that works for you. I’m checking into online and cloud-based alternatives, and will add another post when I’ve found one(s) I like.
* Name changed to protect the embarrassed.