You deposited a check that a customer used to pay you for your goods or services, and it bounced. Now what? This is exactly why the use of checks for payment is dying out. Businesses no longer want to have to deal with having to chase down the money that they are rightfully owed. Many people can be dishonest and fraudulent, and use check payments as a way for them to not have to make good on their payments.
Not only are you stuck without the money you’re owed, you’re also slapped with a fee from the bank who attempted to cash your NSF check. Luckily, you have the law on your side. Every state has a set of rules that dictate collecting on bad checks, and this is where the use of a collection agency for small business comes in.
Usually, you should start off by giving the individual a call to let them know that their check bounced, and they need to pay you back. If they refuse to do so, you’ll need to send a certified letter addressed to them. In it, you should specify that the check bounced, how much payment is owed, and also request compensation for the fee that your bank charged you. Again, this is where a collection agency for small business will step in.
If you go it alone, without the help of a collection agency for small business, and you don’t get anywhere, you can take them to small claims court. It’s important, however, that you’ve taken the above steps first before you proceed. In most states, you’re typically entitled to a number of damages, including:
- The full amount of the check
- Double or triple damages of the check
- Court fees
- Bank charges
- Lawyer fees
For instance, if someone gave you a bad check for $100, you could be entitled to $100 for the check’s amount, $300 for the damages, $125 for court costs, interest of around 6 percent, bank service fees of $20, and lawyer fees of $1,200.
The person who wrote the bad check now has a judgment against them for a lot more than the initial $100 that was owed to you.
This is why many small businesses decide to look to a collection agency for small business to contact the individual before having to go all the way to court. The experts at the collection agency will have plenty of experience in collecting on bad checks, and giving back the money that is rightfully owed to the person that was not paid for their goods or services.
To learn more about a collection agency for small business, like Global Check Recovery, contact us today.