How to Know If a Check Bounced

A bounced check, often called a returned check or NSF check, occurs when there are inadequate funds in the check writer’s bank account to cover the amount specified on the check. The bank cannot process the payment, causing the check to “bounce back” to the depositing bank. This can lead to financial penalties and complications for both the check writer and recipient.

Early Indicators of a Problem

Before receiving formal notification from a bank, several preliminary signs might suggest a check could bounce. For the person who deposited the check, a common indicator is a delay in the availability of funds. Checks often clear within one to two business days, but banks place longer holds on larger amounts or if account history raises concerns. This delay in funds becoming available can be an early red flag. Unusual communication from the check writer, such as inquiries about clearance, can also be a sign. Observing your online banking account for a “pending” transaction that does not move to a “cleared” status or seeing a reversal of funds after they were initially credited can also signal an issue.

For the individual who wrote the check, proactively monitoring their bank balance is a simple step. If the balance is lower than anticipated after writing a check, or if the account balance is low before clearance, a problem exists. Many banks offer automated low balance alerts that can be set up via email or text message, notifying account holders when their funds fall below a specified threshold. Such an alert after writing a check prompts immediate action. Additionally, if the person who received the check contacts you regarding non-payment, this is a direct indication that the check has likely bounced.

Official Confirmation from Your Bank

When a check officially bounces, your bank will provide formal notification, confirming the issue and detailing the reasons. One of the most common ways banks communicate this is through a physical notice sent via postal mail. This notice includes the check number, amount, reason for return (e.g., insufficient funds, stop payment, closed account), and any associated fees.

Electronic notifications are also widely used. Banks often send alerts through their online banking portals, via email, or as push notifications to mobile banking apps. These digital alerts serve the same purpose as a mailed notice, providing timely information about the returned item. A bounced check appears on your monthly bank statement, listed as a “returned item” or “NSF” transaction, along with any fees. For significant amounts or if you have a dedicated relationship manager, your bank might contact you directly by phone.

Actions and Repercussions

Upon confirmation of a bounced check, both the recipient and the writer face distinct actions and consequences. For the recipient, their bank charges a “returned item fee” or “deposit item returned fee,” ranging from $8 to $20. It is advisable to politely contact the check writer to inform them of the bounced check and arrange an alternative payment method. Re-depositing the check is an option, but risks additional fees if it bounces again.

State laws govern bounced checks, and further action is possible, such as pursuing the matter in small claims court to recover the amount owed plus any fees.

For the person who wrote the bounced check, their bank will impose a non-sufficient funds (NSF) fee or an overdraft fee. These fees range from $25 to $35 per incident. It is important to immediately deposit funds into the account to cover the original check amount and any incurred fees. Promptly contacting the payee to apologize and arrange an alternative payment maintains a positive relationship. Repeatedly bouncing checks can negatively affect your banking relationship, potentially leading to the bank closing your account. While a bounced check itself does not directly impact your credit score, associated actions, such as unpaid overdrafts that lead to collections or missed bill payments, can be reported to credit bureaus and negatively affect your credit history.