9 Bounced Check Consequences That Could Deeply Impact You

Bounced checks can have serious financial consequences.
Updated May 8, 2024
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Bouncing a check may seem like a minor oversight, but it can lead to a cascade of major consequences that undermine your financial fitness.

Whether it occurs due to an innocent mistake or is a sign of deeper financial trouble, it’s crucial to understand the potential fallout. Here are nine things that can happen if you bounce a check.

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A bank might charge you with an NSF fee

Monkey Business/Adobe worried couple with bills

When you write a check without enough money in your account to cover it, your bank may charge you a nonsufficient fund (NSF) fee.

This fee is typically hefty and can range from $20 to $40 or more. The good news is that the vast majority of banks have eliminated these fees, although some banks still charge them, according to the Consumer Financial Protection Bureau.

It’s important to note that states generally impose limits on NSF fees and other fees on this list.

A merchant might hit you with a fee

Damir Khabirov/Adobe woman calculating debts feeling stressed

If you bounce a check to a merchant, that retailer might also charge you a fee. This fee is meant to cover the cost and inconvenience caused by the bounced payment.

Depending on the merchant's policies, this fee can range from about $20 to $40. Utility companies and landlords also might charge these fees.

A bank could levy an overdraft fee

SB Arts Media/Adobe stressed woman managing finances

Banks often offer overdraft protection as a way to avoid declined transactions due to insufficient funds. If you have overdraft protection on your account, the bank may cover the amount of the bounced check.

However, you may pay a price for this service in the form of an overdraft fee. Such fees can amount to $35 or more.

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You could struggle to open bank accounts and write future checks

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Bouncing a check should not directly impact your credit score. However, checking account reporting agencies such as ChexSystems or TeleCheck may note that you have bounced a check.

This type of negative notation with ChexSystems could make it harder to open new bank accounts in the future. Such a notation with TeleCheck could cause merchants to reject the checks that you write.

You might suffer ripple effects that eventually ding your credit score

Andrey Popov/Adobe looking at computer screen

As we mentioned, bouncing a check doesn’t directly hurt your credit. However, if the bounced check was intended to pay a loan or credit card bill, it’s possible that a bounced check could indirectly impact your credit score.

Late or missed payments can lower your credit score and make it harder to qualify for credit in the future. Additionally, if the bounced check results in a collection account being opened, it can significantly damage your credit score.

You could be subject to legal action

Wasan/Adobe the legal action agreement

In some cases, bouncing a check can result in legal action against you.

Knowingly bouncing a check is illegal. Depending on the laws in your state and the amount of the bounced check, you could face penalties ranging from a misdemeanor to a felony or even jail time.

The payee also may choose to pursue legal remedies to recover the funds owed, which could lead to additional fees, court costs, and even a judgment against you.

Your account could be closed

nenetus/Adobe stressed business woman

Repeated instances of bounced checks may prompt your bank to close your account. Banks have the right to close accounts for various reasons, including a history of financial mismanagement or excessive overdrafts.

Banks often report account closures due to overdrafts to ChexSystems. If your account is closed due to bounced checks, it can be challenging to open a new account elsewhere, as banks may view you as a risky customer.

You might be asked to explain yourself

(JLco) Julia Amaral/Adobe frustrated business man

After bouncing a check, you may need to reach out to the payee and explain the situation. This can be embarrassing and uncomfortable, especially if the bounced check was for a significant amount or involved a business or acquaintance.

Additionally, if the payee is unwilling to accept your explanation or offer a payment arrangement, it can strain your relationship with them, adding interpersonal stress to the financial repercussions.

You might have to reach out to vendors to arrange a new payment schedule

DimaBerlin/Adobe frustrated female making phone call

If the bounced check was meant to cover a bill or payment to a vendor, you may need to contact them to arrange a new payment schedule. This can be inconvenient for both parties and embarrassing for you.

Additionally, some vendors may charge late fees or penalties for bounced payments. This is just another reason to prepare yourself financially by making sure you have enough money in your checking account to cover the checks you write.

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Bottom line

Happy Hues/Adobe filling a banque cheque document

Bouncing a check can have far-reaching consequences that extend beyond just financial penalties. It's essential to be vigilant about your finances and ensure you have enough funds in your account to cover any payments you make.

Take proactive steps to avoid bouncing checks and make smart money moves, such as tracking your account balance, setting up alerts for low balances, and maintaining a buffer in your checking account.

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Author Details

Adam Palasciano Adam Palasciano is a personal finance-obsessed and money-savvy individual who loves to hash out content on all things saving money. He specializes in writing millennial-friendly personal finance content, covering topics ranging from trending financial news, debt, credit cards, cryptocurrency, and more.

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