Understanding the Pre-printed Information on Your Checks
It is important to understand the information that is already printed on your checks so you can write checks accurately and completely. Below is a diagram of all the pieces of information you will find on a check:
What You Will Need to Complete:
To complete your checks, you will need to fill in the following pieces of information:
- The date.
- The Pay to the Order of line.
This is where you write the name of the person or company to whom you will give the check. After writing the name, you can draw a line to the end. This prevents anyone from adding an additional name on your check.
- The dollar amount of the check in numbers.
Such as $19.75.
- The dollar amount of the check in words.
Such as 75/100. After writing out the amount of the check, draw a line to the end. This prevents anyone from adding an additional amount after what you have written.
- The memo section.
This area is optional. You can use this area to remind yourself why you wrote the check or to record the account number of the bill you are paying.
- The signature line.
A correctly filled out check will look like this:
What is on the Check That You Will Need to Know?
- Your name and address. Your phone number is sometimes included.
- The check number. The number is used to identify each check written.
- Codes for the state where the bank is located and the regional Federal Reserve Bank that will handle this check.
- Your bank's number and branch.
- Routing numbers.
This includes the bank and state computer routing numbers, as well as your account number.
What is On the Back of Your Check?
There is also significant information printed on the back of your checks:
The back of the check has an endorsement area. Endorsing a check means to sign the back of the check to make it "cashable".
For example, if you write a check to your friend, your friend would endorse the check to get the cash or to deposit the amount into his or her account.
Consequences of Bouncing a Check
If you write a bad check...
- Each bad check might cost you a fee of $10 to $30.
- Additional checks you have written may not be paid.
- Your negative activity can be reported to account verification companies like ChexSystems and TeleCheck. This can make it difficult to cash checks and to open accounts in the future.
- Your bank also can close your account and send a negative report to the credit bureaus. The amount of the overdraft and fees might be reported as a collection item.
- Some states have additional consequences. Writing a bad check is a crime in every state. Each state has different civil and criminal penalties.
For example, some states have monetary penalties, such as $1,500 fine. Others may actually call for jail time and a fine. In some states, writing a bad check is a felony with imprisonment for up to five years.
Protect Yourself Against Writing Bad Checks
Not having the money in your checking account to pay the check you wrote is called an overdraft. Most banks offer overdraft protection, or bounce protection. This protects you from writing bad checks.
When you sign up for overdraft protection, the bank will use the money from another one of your accounts to cover the transactions if you don't have enough money in your checking account. Keep in mind, overdraft protection is different than bounce protection.
Although overdraft protection is not free, it usually costs much less than paying an overdraft fee. Ask your bank for specifics about the overdraft protection they have to offer.
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