What happens if there are insufficient funds in my bank account to cover a check payment?
It’s up to the bank. If they think that you are good for the money, they may advance funds to cover it. Otherwise, the check will get sent back to the depositor, marked “NSF” (not sufficient funds). In either case, the bank will stick you with some service charges, and if they bounce the check, the depositor will probably stick you also. Talk to the bank about arrangements for preventing this; many banks will link your checking account to some other account, so that if a check would otherwise bounce, the other account will be tapped instead. There will still be service charges, but they will be less.
It depends upon your bank and how they treat your account. The simplest thing for them to do would be to send the check back to who ever cashed it stating that there are insufficient funds in your account to cover the cheque (they refer to this as a “bounced cheque”). In these cases they usually charge you a fee as a “punishment” for bouncing the cheque which in many case is normally around $20 but each bank is different. In my case, because my bank knows that my pay cheques from my Govt job are deposited regularly they usually cover the cheque and either dip into my overdraft or expand my overdraft to cover it. It’s up to them if they want to do that for me though and IF I ever get that close to my limit of available funds I’m doing so at my own risk.
