“People put (a check) in a drawer or a stack somewhere. Then, the next day the mail comes and it gets put on top, and it just gets lost,” says Walter Graham, chief of unclaimed property at the Florida Department of Financial Services.
A consumer who comes across one of these uncashed checks faces a conundrum. While it may be possible to cash a check that’s more than 6 months to a year old, there are several things consumers need to consider before heading to the bank with Nana’s old checks.
First things first: There is no hard-and-fast rule about when a check becomes expired.
The Uniform Commercial Code, which is a standard set of business laws that governs financial contracts and has been adopted by most states, says that a bank does not have to accept a check more than 6 months old.
Similarly, the Federal Reserve’s Regulation CC says a bank does not have to deposit a check if it has reasonable doubt — such as if the check is old — as to whether the paying bank will pay the money.
However, a bank can choose to go ahead and cash that check if it feels the check is being presented “in good faith.”
“The statute says you’re not required to clear an item. It doesn’t mean you won’t,” says Rob Delaney, president and CEO of Gold Coast Federal Credit Union in West Palm Beach, Florida. He says Gold Coast typically doesn’t accept a personal check dated more than 6 months ago, but adds: “There’s wiggle room. If it’s a few days (after the 6-month cutoff), we’ll accept that.”
Even expiration dates written on checks, such as “void after 90 days,” can be overlooked at the bank’s discretion. “There is no UCC provision that specifically addresses validity of check expiration dates,” says Mike Townsend, spokesman for the American Bankers Association.
Graham says many people mistakenly take those “void after” dates as deadlines that are strictly applied when cashing old checks.
“Some people believe, ‘Oh, my Lord, I waited one week too long and now I lost out on that money,'” Graham says. “Just because I have a check that says ‘void’ after a certain amount of days, that money is still owed to me.”
However, gambling on whether a bank will accept an old check is a risky game.
Consider this: Is it worth risking a potential fee if the $15 birthday check from Grandma bounces?
Many banks charge a “deposit item returned” fee to consumers who try to deposit checks that bounce. That fee varies; consumers could pay a couple of bucks or $30 or more, depending on the account and the bank. The banks’ rationale is that the consumers receiving the checks are in the best position to know whether a check is good.
Before trying to deposit an old check, consider where it comes from and how likely you think the check is to bounce or that the giver has put a stop-payment order on it. Is that checking account of your neighbor likely to still be open or have enough money to cover the check? What about that check you got from a company for your freelancing work?
If you’re not sure whether the check can be cashed, it’s often better to go back to the check writer and ask that a new check be written.
There are also important etiquette questions when it comes to cashing old checks, says Jacqueline Whitmore, an etiquette expert and founder of The Protocol School of Palm Beach in Palm Beach, Florida.
By delaying cashing a check, the giver may be struggling to balance an account, she says. Or, perhaps the giver has forgotten about the check and no longer has enough money in the account to cover the check. Cashing it without telling the giver could mean overdrawing that person’s account and forcing him or her to pay overdraft fees.
That’s what happens in one “Seinfeld” episode. Poor Nana’s checking account gets overdrawn when Jerry decides to cash all the old birthday checks he’s received from her over the years.
Whitmore says it’s best to contact the person who wrote the check “and say something like, ‘I found a check you gave me 6 months ago. It must have gotten lost in the shuffle. Is it too late to cash it? I apologize for the inconvenience,'” Whitmore says.
It may feel awkward to make that call, but honesty is the best policy, Delaney says. “A lot of times, the person who wrote the check is wondering why you didn’t cash it,” he says. “People may get angry at you because you haven’t cashed a check, like it’s insignificant (to you).”
Whitmore says that it’s also all right for the giver to call a check recipient and ask whether he or she received a check if there’s a delay in the recipient cashing it. She suggests waiting no more than 90 days to make that call.
It’s possible that consumers might further move away from paper checks. And, the rise of things like mobile check deposit and gift cards might help to diminish the problem of losing track of uncashed checks.
Still, an estimated 13.7 billion checks were written in 2015, according to Bluepoint Solutions, which provides check-processing and document-imaging technology and services for financial institutions. And inevitably, people will lose track of some of them — like that $57 dividend check you forgot had come in the mail a while back, says Graham, the former president of the National Association of Unclaimed Property Administrators.
“You can take a date or friend out to Outback (Steakhouse) with that,” Graham says. “It’s nothing to sneeze at, but it’s not so big that you run to the bank in a separate trip. (People) set it aside and it gets forgotten about or accidentally thrown out, and that check never gets cashed.”