Keeping track of bills and payments can be difficult, here’s how to make it easier.
Dishonored payment fee
Dishonored payment fees occur when you don’t have enough funds. Bankrate explains.
What is a dishonored payment fee?
A dishonored payment fee, also known as a returned payment fee, is the charge that a person receives when she attempts to make a payment but doesn’t have enough funds to cover the cost. Such a fee may be levied by an organization the person is trying to pay for services rendered when the organization is unable to charge her credit card or cash a check she gave them.
If someone pays a company and the company is unable to withdraw the funds from that person’s bank or charge her credit card on time, the company may tack on an additional cost. These costs are called dishonored payment fees, and they are meant to cover the company’s own bank fees and the loss of its liquid funds. The dishonored payment fee seeks to reimburse the company for these costs and discourage customers from making payments that they don’t have the money to cover.
Dishonored payment fees may run between $10 and $35.
Such fees occur sometimes happen when the customer believes that it is better to make the payment anyway so as to avoid a late fee, interest costs, or a negative mark on her credit report. The customer may still have to pay late fees or interest in addition to the dishonored payment fee.
The bank may return the customer’s payment even when she has sufficient funds in her account if she provides incorrect or incomplete bank account information.
Always have money in the bank for your payments with a great checking account.
Dishonored payment fee example
Some examples of organizations that charge dishonored payment fees are those that provide a service, such as a lawyer or doctor’s office. Government organizations, like the Department of Motor Vehicles, also charge returned payment fees. People are also charged dishonored payment fees when paying utility bills, if the check doesn’t clear or the bank when payment is scheduled, as well as payments to credit card bills for the same reason.
More From Bankrate
3 min read Oct 04, 2022
Walk away with stacks of cash just for opening a checking or savings account.12 min read Oct 03, 2022
ATMs are useful for depositing money, checking your balance, and more, but be aware of possible issues that may arise.3 min read Sep 29, 2022
Sending money to another country can be a quick, easy and safe process. Read to find out the various ways you can utilize and how to transfer money internationally.5 min read Sep 29, 2022
Digital banking has been steadily on the rise, making it easy to access your accounts and manage your personal finances from anywhere.11 min read Sep 28, 2022
Some of the most common ways to send or receive money electronically include ACH, EFT, and wire transfers.5 min read Sep 27, 2022
Native American-owned banks and credit unions help underserved communities by providing access to bank accounts, loans and other financial services.7 min read Sep 27, 2022
Here’s a convenient way for Apple device users to transfer money between friends and family.5 min read Sep 19, 2022
Here’s what to know about the checking and savings account alternative.4 min read Sep 19, 2022