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post dated check

Understanding Post Dated Checks

A post dated check is a type of check where the date written on the check is in the future, not the current date when it is written. For example, if today is February 15th, 2024, but I write a check with the date of March 1st, 2024, that would be considered a post dated check.

Reasons To Use Post Dated Checks

There are a few main reasons why people use post dated checks:

• To delay payment until there are sufficient funds available. If I know I won’t have enough money in my account to cover a check today, but I will by March 1st, I can post date it so it won’t bounce when deposited or cashed right now.
• As a makeshift personal loan. Post dating a check is sometimes used as a way to essentially “loan” money to someone else for a short period of time. The recipient agrees not to cash or deposit the check until the later date.
• For budgeting purposes. Post dating checks can help people budget for future expenses by already having the check written out and setting aside the funds.

It’s important to note that legally, post dated checks can still potentially be deposited or cashed before the written date. It depends on the policies of the bank and laws in each state. The recipient of the check isn’t necessarily obligated to hold onto it until the post date.

Laws On Post Dated Checks

Post dated check laws vary by state, but some overarching things to know:

• In most states, post dating a check doesn’t necessarily make it invalid if cashed earlier. The check can potentially still clear, putting the account holder responsible for covering the amount (and any overdraft fees).
• However, some states like New York do have laws preventing early withdrawal of post dated checks.
• If a post dated check bounces because the funds weren’t available yet when cashed early, the account holder who wrote the check could potentially face consequences like:
  • Bank fees for overdrafts or bounced checks
  • Damage to credit score
  • Legal issues if considered fraud or theft

So while post dating alone doesn’t guarantee a check won’t cash, additional legal protections may exist in some states. It’s best to research individual state laws.

Stopping Payment On a Post Dated Check

If you’ve written a post dated check but want to cancel it, you can place a stop payment order with your bank. There is usually a fee for stop payments, but this will instruct your bank to decline payment on that check if presented.

Some things to know:

• Stop payment orders usually expire after 6 months. So you’d need to renew it after that time if necessary.
• Be prepared to provide specific details like the check date, number, amount, and recipient name. This helps the bank identify the correct check.
• Stop payments typically need to be placed 3 or more days before the post date to give the bank time to process.
• Even with a stop order, banks could potentially still honor that post dated check by accident. So monitor your account to confirm.

Placing stop payments can be done online, over the phone, or in person at your bank. Check with your specific financial institution for details on their stop check policies and potential fees.

What To Do If You Receive a Post Dated Check

On the flip side, if someone gives you a post dated check, here are some tips:

• Don’t assume you can or should cash it right away. Depositing early when asked not to can permanently damage relationships and trust.
• If the post date is only a few days away, just wait. Don’t risk fees or complications trying to cash early.
• Understand laws don’t prevent all early withdrawals – banks may cash it regardless. But ethical and moral obligations to the check writer remain.
• If waiting is not possible for some reason, communicate with the issuer first before attempting to cash or deposit.
• When the post date arrives, cash or deposit the check as soon as possible. Post dated checks can still bounce even after the posted date in some cases.
• If the check bounces after the posted date, contact the issuer immediately to resolve. Small claims court is an option if they refuse.

So in summary, post dated checks come with some risks and should be handled carefully by both check writers and recipients. Maintaining open communication and understanding legal policies can help avoid problems. Check with your bank about specific post date rules and procedures too.

Alternatives To Post Dated Checks

While sometimes necessary, post dated checks have downsides as discussed. Here are a few potential alternatives to consider:

Electronic Payments

Services like PayPal, Venmo, CashApp, Apple Pay, etc allow electronic peer-to-peer payments. These deduct funds in real time (instead of post dating). Apps offer options to request money from others directly too.

Pros: No need to post date, convenient, fast, trackable

Cons: Recipient needs an account, fees may apply

Personal Loans

Borrowing small personal loans from banks, credit unions, or online lenders can bridge short-term cash flow gaps.

Pros: No postdating, fixed terms, predictable payments

Cons: Credit checks required, interest charges, strict eligibility rules

Automatic Bill Payments

If postponing a payment for a set amount/date, consider scheduling an automatic electronic payment instead.

Pros: Guaranteed payment on the date, no checks involved

Cons: Need to directly link bank account, doesn’t work for peer/personal payments

While post dating has benefits in some financial situations, risks remain due to variation in laws, bank policies, and people’s behavior. But being informed and smart about usage can help minimize issues. Evaluate your options and speak to professionals to find the right solution for your specific needs.

Common Questions About Post Dated Checks

Here are answers to some frequently asked questions about post dated checks:

Are post dated checks illegal?

No, writing and issuing post dated checks is legal in the United States. Certain states have laws about cashing them early as discussed already. But in general, post dating alone does not make a check illegal.

Can a post dated check be cashed early?

Yes, banks can cash post dated checks before the written date, but it depends on their policies. Some states also explicitly prohibit this. The check writer is still responsible for any issues caused if cashed early.

How do I cancel a post dated check?

To cancel, you can place a stop payment order with your bank. This instructs them to decline payment on the check if presented. Stop payments usually expire after 6 months. Fees often apply too.

Can banks cash expired post dated checks?

Yes, it’s possible for banks to still honor post dated checks even if the stop payment expired already. Monitor bank statements carefully for any checks that should have expired but mistakenly get cashed.

What happens if a post dated check bounces?

If funds aren’t available when the recipient tries depositing, it will bounce. Consequences can include overdraft fees, credit damage, legal issues, and relationship impacts with the recipient.

Final Thoughts

• Post dating checks allows people to delay payments until a future date. This can help coordinate timing or budgeting.
• Laws and policies on cashing post dated checks early vary greatly by state and bank. Additional legal protections may or may not exist.
• Both check writers and recipients share responsibility in handling post dated payments properly and ethically.
• Alternatives like electronic payments, loans, or automatic transfers can also achieve similar payment delay goals in some cases.

As with any financial decision, understand the implications before writing or receiving post dated checks. They don’t necessarily guarantee delayed withdrawals. Weigh options, follow rules, communicate expectations clearly, and monitor carefully. With some caution, post dating can be an appropriate strategy for staggered money management in many situations.