If you’re a landlord or a business owner in California, you may have experienced the frustration of receiving a bounced check from a tenant or customer. Not only does it cause a delay in receiving payment, but it can also result in additional fees and expenses. So, can you charge a fee for bounced checks in California? Let’s explore the answer to this question and other related topics.
What is a Bounced Check?
A bounced check, also known as a returned check or NSF (non-sufficient funds) check, is a check that is returned by the bank due to insufficient funds in the account. When a check bounces, the recipient of the check does not receive the payment and may incur additional fees from their bank.
California Bounced Check Fees
In California, there are specific laws regarding bounced check fees. According to California Civil Code Section 1719, a person who writes a check with insufficient funds may be liable for damages in the amount of the check, plus a service charge of up to $25 for the first bounced check and up to $35 for each subsequent bounced check.
However, it’s important to note that the service charge cannot exceed the actual damages incurred by the recipient of the bounced check. For example, if the bank charges a $10 fee for a bounced check, the recipient cannot charge a $35 fee to the person who wrote the check.
Can You Charge a Fee for Bounced Checks in California?
As a landlord or business owner in California, you may wonder if you can charge a fee for bounced checks. The answer is yes, but there are limitations. According to California Civil Code Section 1719, a recipient of a bounced check may charge a service fee of up to $25 for the first bounced check and up to $35 for each subsequent bounced check.
However, it’s important to follow the guidelines set forth in the law. The service fee cannot exceed the actual damages incurred by the recipient of the bounced check. Additionally, the recipient must provide written notice to the person who wrote the bounced check before charging a service fee.
FAQs
Can I charge a fee for a bounced check if I didn’t provide written notice?
No, according to California Civil Code Section 1719, a recipient of a bounced check must provide written notice to the person who wrote the bounced check before charging a service fee.
Can I charge a fee for a bounced check that was post-dated?
Yes, according to California Civil Code Section 1719, a recipient of a post-dated bounced check may charge a service fee of up to $25 for the first bounced check and up to $35 for each subsequent bounced check.
Can I take legal action against someone who wrote me a bounced check?
Yes, you can take legal action against someone who wrote you a bounced check. However, it’s important to follow the guidelines set forth in the law and seek legal advice before taking any action.
Conclusion
In conclusion, if you’re a landlord or business owner in California, you can charge a fee for bounced checks, but there are limitations. According to California Civil Code Section 1719, a recipient of a bounced check may charge a service fee of up to $25 for the first bounced check and up to $35 for each subsequent bounced check. However, the service fee cannot exceed the actual damages incurred by the recipient of the bounced check, and written notice must be provided before charging a service fee. By following these guidelines, you can protect your business and ensure that you receive payment for your services.
