The best way to prevent a returned check is to make sure you have enough money in your checking account before writing the check. The recipient may not cash or deposit the check right away, so you’ll need to monitor your account online (or your monthly paper bank statement). Keep enough money in your checking account to cover the check until it’s cleared.
But what if you wrote a check and, after handing it over, realize you don’t have the money to cover it? Here are a few ways to prevent returned check fees with your financial institution:
1. Make sure the check has cleared
If the check has not yet cleared, you can request a stop payment on the check. To do so, contact your financial institution and ask to cancel the check.
This may, however, result in a separate fee – and you’ll still have to figure out how to pay whomever you wrote the check to in the first place.
2. Contact the recipient
To avoid the stop payment fee, try contacting the payment recipient instead. If it’s a friend or family member, call them and ask them to wait to deposit or cash the check. Most loved ones will be understanding.
However, if you used the check to pay your landlord or a contractor, you may have less luck asking them to hold off on depositing the money. If they accept other forms of payment, such as credit cards, you can request to pay that way and have them void the check.
Just be careful with amassing high-interest credit card debt. It can quickly become more expensive (and dangerous to your credit) than a single returned check fee.
3. Contact your financial institution
If the damage is already done and the returned item fee has appeared on your bank statement, try calling your financial institution and explaining the situation. If this is your first mistake and you’ve been a long-time customer, they may waive the fee.
Banks aren’t required to waive this fee, though, so it pays to be polite when talking to the customer service representative. Just know that you might not get them to waive the fee.
4. Make a deposit to cover the check
If you realize you don’t have enough funds in your checking account to cover a check you’ve just written – but you do have the money elsewhere – act quickly to move the money into your account to cover the check.
If the money is in a connected savings account, launch your mobile banking app and transfer the funds. The transfer could be instant if both accounts are with the same bank.
Alternatively, go to the nearest branch or an ATM near you to deposit money into your checking account.
5. Opt into overdraft protection
Your bank or credit union may offer overdraft protection. With overdraft protection, your financial institution can cover whatever portion of the check you don’t have the funds for, either through another open account of yours or through future direct deposits.
This can help you avoid non-sufficient funds fees, though financial institutions may also charge you to use overdraft protection.
