How to Write a Check Properly to Avoid Rejected Payments
Many payments today are being made electronically and it seems checks are gradually being phased out.
Many banks offer checking accounts that don’t even come with paper checks.
You can use them as typical checking accounts in every respect except to write a paper check. Rather, they let you send checks through online bill pay.
There are those times when writing a check is necessary.
For those rare times when it may be needed or desired, you’ll find this article helpful.
After all, the fine art of check writing isn’t taught in high schools and colleges, and we’re being encouraged at every turn to make payments online.
How to Write a Check
There was a time, before the Internet became popular, when writing checks was common.
It was even the preferred way to pay bills to remote vendors, or to send money to family or friends. If it’s been a while since you’ve written a check, or you’ve never written one at all, here are the basics.
Take a moment to study it.
To write a check to another party, you’ll need to complete the following information on your check:
A check must include a date to be valid.
Most typically, you’ll enter the date the check is written.
But it’s also possible to post-date a check, which we’ll discuss toward the end of this article.
When you enter the date, you can either write out “May 14, 2019” or enter it numerically as “05/14/2019”. It will be accepted by the bank either way
“Pay to the Order Of”
This is the line where you enter the name of the person or the institution you’re writing the check to.
If you’re writing a check to an institution to pay a bill, they’ll usually give you the specific name to enter. It may be something like “ABC Electric Utility Company, Inc.”.
If so, you’ll have to complete the line exactly as the payee has indicated.
If you’re making the check to an individual, make sure you get the proper spelling of their name. An incorrectly spelled name can result in the check being dishonored upon presentation.
If the intended party’s name is Michael S. Johnson, completing the line as “Mike Johnstone”, or some other variation, can result in rejection of the payment by the bank.
You’ll enter the numeric amount of the check on this line or box.
You can enter it as either $110.97” or “110 97/100”.
If you enter it in the second format, make sure 97 is written above 100, making it appear as a fraction. If you don’t, the bank can interpret it as $11,097.
It’s extremely important to be as precise as possible when you’re filling out a check, and with each line on the check.
This is almost always a very long blank line followed by the word “Dollars”.
Here you’ll write out the amount of the check.
It acts as a double check for the bank on the intended amount of the check.
If the check is for $110.97, you should write out One-hundred and ten and 97/100, again with the change written as a fraction.
This line is primarily for your own personal information.
The bank will generally ignore it. But here you can list more specifics about the check.
For example, you can list a billing invoice number, the date the payment is due, or the specific period of time the payment covers.
If you’re writing a check to an individual, you could write something to the effect of “gift”, “payment of amount owed”, or “for split lunch bill”.
If you have any questions about the check after it’s cashed, the memo line will help you remember the specific purpose.
To be cashed or deposited, the check must be signed by you as the issuer of the check.
Much like a contract, this will be your legal acknowledgment that the information contained in the check is accurate, and the bank has your permission to make payment.
How to Write a Check to More than One Party
There may be times when you’ll need to write a check to more than one party.
If you do, the key words to remember are “and” and “or”.
The word you use will determine exactly how the check can be cashed or deposited.
If you’re writing a check to two people, and you want it to be cashed or deposited only by both, you’ll need to use “and” in the “Pay to the Order Of” line.
For example, you’ll write “Mary R. Smith and Steven P. Jones”. When written that way, the check can only be cashed or deposited when it has been endorsed by both parties.
If you’re writing a check to two people, with the intention either should be able to cash or deposit it, you’ll use “or”.
In that case, you’ll write “Mary R. Smith or Steven P. Jones”.
When written that way, either party can cash or deposit the check without the endorsement of the other.
The Rules on Post-Dating a Check
Post-dating a check is writing a check today using a future date.
For example, on May 14, you may date a check for May 24.
There are different reasons for doing this, but the main one is because you currently don’t have sufficient funds in your account to cover the check. In anticipation that you will have the funds by the 24th, you postdate the check.
But be very careful with this practice.
In most states, a check can be cashed at any time, regardless of post-dating.
In the example above, if the payee receives the check on the 16th, and deposits it on the 17th, your bank will pay the amount of the check.
If you don’t have sufficient funds in the account to cover the amount of the check, the check will be dishonored (“bounced”) and two fees result:
- you (the check-writer) may be charged an overdraft fee or returned check fee
- the depositor gets hit with a deposit item returned fee for a failed check deposit
These are usually between $35 and $40 each. But if you write a check that bounces, the payee may also require you to cover their return item fee.
In that case, you may be hit with fees of $35 from your bank, and $35 from the payee’s bank.
You should also be aware that bouncing a check is potentially a criminal infraction.
Make sure you have sufficient funds in your account to cover the amount of every check you write.
If your check does bounce for any reason, fully cooperate with the payee, including paying any fees due to their bank. If not, they may press charges.
Filling in the Line for "DOLLARS"
This line rates a special discussion.
Generally speaking, if there’s any discrepancy between the numeric payment amount and the written payment amount, the bank will go by the written payment amount.
For this reason, this line in particular will need to be absolutely precise.
There are two important points to keep in mind in completing this line:
- Begin writing the dollar amount as far to the left side of the check as possible. Ideally, there’ll be no space available between the edge of the check and the written amount. This will prevent the written payment amount from being altered, or more precisely, increased.
- If there is any space left on the line between the change and “Dollars”, draw a straight line connecting the two. That will eliminate the possibility of any alteration to the right of the written amount.
Memo Requirements by Payee or Biller – If Any
Earlier I wrote that the memo line on the check is generally for your own information.
But there are times when a payee or biller may require you to enter specific information on that line.
Most typically, this will be:
- the account number on the bill you’re paying
- personal identifying information, like your driver’s license number
However, in some cases, the payee or biller will ask you to enter that information at the top of the check, near your name.
That will leave the memo line free for your own notes.
What if You Make a Mistake in Completing the Check?
If you do make an error in completing a check, simply cross out the incorrect information, and write the corrected information above it.
Put your initials right near the correction.
If you make more than one error, or if the error you’re attempting to correct is significant, the bank may reject the check.
You’ll need to use judgment here, but you may need to consider voiding the original check and writing a new one.
Recording Your Checks in Your Checkbook Register
Unlike online payments, paper checks don’t record in your account automatically.
You’ll should to enter the information manually in your checkbook register.
It will give you a written memo of the check, including when it was written, the party was made out to, the amount, and the purpose.
You’ll also need to deduct the amount of the check from your checking account balance.
This will be very important because the bank won’t make the deduction until the check clears. But you’ll need to know that information while the check is outstanding. It will keep you from overdrawing your account, and risking a bounced check situation.
Those are the basics of how to write a check.
There are fewer reasons than ever to write a paper check.
But if one of them comes along for you, you’ll know exactly what to do.