How to work with a bad check?

Even though in the 21st century, there are many ways to transfer money, people still write tax. With ATMs, wallets, electronic transfer, online banking, it may surprise some of the younger generations that checks are still in circulation.

But there are reasons for this:

• Some people prefer to check as they have been using it for long, and trust it.
• Some businesses and procedures, like a bank loan or A/C opening, require a check.
• Some people like giving checks, as it gives them enough time to get the money back into their accounts.

These reasons are valid, but the problem with checks is that it bounces sometimes. When a check bounces, it is known as a bad check, and it can create tons of problems for a business that received it. If they received it for payment to services that they provided, it means now they have to collect a debt.

Sometimes, the debtor will resolve it easily, after you tell them that the check bounced. It is because it is a genuine problem. Other times, the debtor pays no heeds to you, and you have to take actions like hiring a collection agency in Atlanta.

How to work with a bad check?

1. Don’t accept one

You cannot know a check is bad until you deposit it. But you can take precautions against it by discouraging the business to write you a personal check. Instead, ask them to use a credit card or for cash or ask them to transfer the money electronically.

Still, if the client insists on paying through a check, make sure you verify the check using a check verification system.

Also, ask them to fill the credit application, so that you can collect on the debt, in case it bounces.

2. Have a conversation with the client

If it is the first time a customer has presented you with a bad check, talk to them. They will resolve it quickly, and the matter will be over. But try to not point any accusation. Keep the tone friendly and light and be calm.

If you want to come off as more serious, send a letter asking to pay the outstanding amount before a specific date. Give the client alternative payment methods as well.

3. Redeposit

If the client asks you to redeposit the check as they have made the funds available, don’t do it without asking the bank. Call the bank in whose favor the check is written and ask them about the fund availability.

If it is there, only then you should redeposit.

4. Call a debt collection agency

If you are unable to get hold of the customer or they refuse to pay, it is time to hire a third-party debt collection agency in Atlanta. They are experts in collecting bad checks amongst other debts.

They have experience, knowledge, and technique and are aware of the laws that protect a debtor. So, they know how to handle high-tension situations.

Situations like these call for immediate action. Don’t sit on a bad check hoping that the customer will call. Even if they are planning to do that, it is best for you to seek them out first, and clear the situation.