Bounced Checks: What the Check Writer Needs to Know

Just about everyone knows that bouncing a check is bad news. It can be pretty embarrassing if it was unintentional, not to mention expensive because any returned checks or account overdrafts can come with fees. While the person who bounced the check can make good right away by paying the money, a lot of problems can arise if the situation isn’t dealt with right away. But not everyone knows what happens when the business needs to go about collecting on bad checks or what happens to the check writer.

Credit Is Affected

People who bounce a check can be dinged on their credit report. If a check that’s written doesn’t clear, the business that is owed can send debt collections on them. If this happens, the individual will end up with a negative effect on their credit standing. Having bad credit makes it much harder to take out a personal loan or a mortgage. They’ll also be charged higher interest rates should they get approved for a loan.

Check Bouncers Can Be Blacklisted

Debit bureaus are often notified when a person bounces a check and does not make good on its payment after attempts for collecting on bad checks have failed. Similar to credit reports, lenders and other service providers use the information from debit bureaus to analyze the risk of lending out money to a particular person.

Even if your credit score is very good, the information provided by the debit bureaus can blacklist check bouncers from borrowing money for any reason. Even renting an apartment or getting a cellphone can prove to be more difficult.

The Business Side

If you are the business owner and you have provided a service or a product to a customer who used a check to pay you, and the check bounced, you can call a debt collections agency, like Global Check Recovery, to work on your behalf to claim that money. After other attempts for collecting on bad checks have been exhausted, such as calling the person and sending them a certified letter requesting the money, collection agencies can always help.

To learn more about collecting on bad checks with Global Check Recovery or to learn more about what you can do as the check writer, contact us today.

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