Cashing Checks

• Postdated checks are legal, but they should not be cashed before time. You are required to give the institution holding your check notice that they are not to cash it. If a check is cashed before the date on the check, there is not much recourse for the debtor except for the losses suffered as a result. Some companies have a policy of not accepting postdated checks because all payments go to an automated payment processing center. There is no one there to open each individual envelope to check for postdated checks. Postdated checks sent to an automated processing facility will be cashed before the established date.
  
  

Notice

• According to the Fair Debt Collection Practices Act, debt collectors receiving postdated checks must follow a specific format depending on when the check is received. If a third-party debt collector (collection agencies) ask you for a postdated check, which is dated 5 days or more in advance, he must send you a letter not more than 10 days and not less than 3 days prior to depositing the check, letting you know that he intends to deposit your check.
  
  

Check Information

• You cannot be forced to send a postdated check. It works to your advantage not to send a postdated check. If a debt collector decides to start legal action at a later date, and she receives judgment, she can do a bank levy and freeze your bank account. In order to do so, she must get a judgment and then find out where your checking account is located. When you send her a postdated check, you are providing her with this information.
  
  

Leverage/Intimidation

• According to the Fair Debt Collection Practices Act (FDCPA), debt collectors cannot threaten to deposit a postdated check prior to the date on the check. They must refrain from asking for postdated checks if their intent is to threaten you with criminal prosecution.
  
  

Fees/Losses

• Avoid sending postdated checks if at all possible. It is easy for a check to be deposited before hand, which could result in overdraft charges. If other checks or charges are processed, you could be charged a fee for each transaction. Contact the collection agency if a check is put through early and ask to be reimbursed for the fees you incur. You will need to provide some proof, such as bank statements and they should accommodate your request