What Happens if You Try to Cash a Bad Check?

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Sitting on a bad check? Read on to see why cashing it might hurt you. 

Payment apps like Venmo make it convenient to send and receive money without having to deal with the hassles of writing out or depositing an actual check. But maybe you have someone in your life who prefers to go the old school route by writing out checks. Or maybe some of your family members like to write you a check for your birthday or during the holidays.

Often, the process of depositing a check into a bank account is a smooth one, as is cashing a check. But what if that transaction doesn’t go through?

Believe it or not, in that situation, you’re not just stuck in an awkward spot. You may be liable for fees — even though you weren’t the one who wrote a bad check in the first place.

When you have to pay for someone else’s mistake

Sometimes, people write bad checks not because they’re trying to be shady, but because they simply lose track of their checking account balances. So, let’s say a friend owes you $100 and they write you a check for that sum. If you go to cash or deposit it and it bounces because they only have $40 in their bank account at the time, you won’t be able to get your money. Annoying, right?

But you may be unpleasantly surprised to learn that in that situation, you could end up being charged a fee by your bank for trying to cash or deposit that cash. This is known as a returned check fee, and SoFi says that it could easily cost you $30 or $35 for a single incident. Ouch.

What to do if someone writes you a bad check

If you’ve received a bad check from someone you know and trust, your only move is really to talk to the person who wrote it and explain what happened. For example, say your friend unknowingly wrote you a check for $100 when they insufficient funds in their bank account. In that case, your friend might be quick to offer you an apology — and issue you a new check once their account balance rises.

That said, a good way to avoid landing in a situation where you’re sitting on a bad check is to ask to get paid in cash. Granted, if it’s your 85-year-old grandmother sending your Christmas gift by mail, that may not work. But if a friend owes you money, you can simply state that you prefer to be reimbursed in cash.

Another thing to keep in mind is that you should never attempt to cash or deposit a check from an unknown source. It’s one thing to cash or deposit a check from your credit card company when it owes you money. But if you receive a check from an organization you’ve never heard of, or a person you don’t know, don’t just take the money.

In some cases, you could end up falling victim to a financial scam by trying to cash or deposit that check. And also, knowingly depositing a bad check could put you at risk of being charged with fraud — and proving that you simply made a silly mistake isn’t always so easy.

Meanwhile, if you’re someone who still writes checks, a good practice is to maintain a ledger so you’re tracking those payments. That way, you won’t have to be the person who causes someone else a headache when they go to cash or deposit your check only to have it bounce on them.

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