Do Bounced Checks Affect Credit?
Bounced checks do not get reported to the major credit bureaus, so they do not affect your mainstream credit scores. However, your bank knows when you bounce checks, so they may reduce your credit limit if you have a credit line at the same bank. In addition, bounced checks may be reported to ChexSystems. ChexSystems is like a credit bureau that only handles checking account activity. If ChexSystems reports that you ve had problems with your checking account, it may be difficult to open checking accounts at other banks in the future. • How ChexSystems Works How Credit Bureaus Work You also run the risk that you ll be sued or your account will be turned over to a collection agency. If the collection agency reports to the major credit bureaus, your mainstream credit scores will suffer. Finally, some alternative credit scoring models look for a history of bounced checks.
