If you own your own small business or work in the billing then you know all to well about the inevitability of receiving a bad check. It’s only a matter of time before someone writes a check that bounces. This unfortunate occurrence is just one of the negative aspects of being in business, but being burned by a bad check doesn’t have to mean losing out on a payment. For those who are facing this event for the first time let us explain how to collect on a bad check.
There are a few ways to collect on an NSF check depending on the circumstances surrounding it. In many cases the person writing the bad check does not realize they do not have enough funds to cover the transaction. In these instances the best thing to do is call the person who wrote the check and explain that they will need to pay the check amount in addition to the check fee you were charged by the bank. If the person agrees to these terms you will quickly resolve the NSF check issue. If the person does not agree, or cannot be reached, you will need to take further action to collect monies owed.
The following steps will let you know how to collect on a bad check in the event that the check writer does not cooperate with the initial request. The first course of action is to call the bank where the checking account is held. Explain that you received a bad check and would like to collect the amount on the check.
While the bank cannot tell you how much money is in the account, they can tell you if there is currently enough of a balance to cash the check. If there is enough money in the account you can take the check to the bank and cash it. Using this method can be very time consuming because you may have to call daily or weekly until the funds are available. This method will also not get you any fees charged by your bank for trying to cash the bad check.
If going through the bank proves fruitless or time consuming you can always take legal action. As a business owner you can report the bad check to the city along with any additional fees you were charged for processing the check. The city will then send a letter to the check writer giving them a predetermined period of time to repay the amount or face legal action.
Once you know how to collect on a bad check you quickly realize how time consuming and frustrating the process can be. That’s why Global Check Recovery makes the process easy by handling all the details for you. Simply send us your bad checks and we will take care of the rest!