What To Do When a Parent Bounces a Check

It happens.

A parent pays you by check and it bounces.

Here’s how you can handle this situation:

Put in your contract that parents must pay a “returned check” fee. The fee should include the amount the bank charges your account, plus an additional fee ($10-$25?) for the hassle it creates for you.

Some family child care providers charge parents extra fees for additional charges to their bank account when the bounced check causes other checks in your account to bounce.

6a0133f3fc5805970b01b7c78c5e82970b-320wiTo reduce the chances of other bank changes, require parents to pay you in advance. Or set up an electronic bank transfer payment plan. See my article, “How to Get Paid Through Electronic Bank Transfers.”

There are also private companies that offer this service. Reliafund is one. Minute Menu Kids Pro also offers electronic transfer of funds through ChildCarePay.com.

You could also set yourself up to get paid by credit cards. See my article, “Do You Accept Credit Cards from Parents?”

Here’s a great discussion among providers about parents bouncing checks on Daycare.com.

You can establish whatever policies you want regarding returned checks. Many providers start requiring the parent to pay in cash, or certified check. You don’t have to require all parents to pay with cash.

If a parent hands you a check and asks you to wait before depositing it, you can refuse the accept the check and enforce a late payment fee. Or, you can wait to deposit it. It’s up to you.

In the end, it’s up to you to enforce your contract and ensure that you get paid on time.

How do you handle bounced checks?

Tom Copeland – www.tomcopelandblog.com

Image credit: getoutofdebt.org



Categories: Contracts & Policies

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