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September 23, 2020 Uncategorized

Recovery for Dishonored Checks

If you accept a check from a customer, client, or other party, you expect that the check will be honored and that the funds are available to receive your payment. However, in some cases a person or entity will write a bad or dishonored check, which can leave the creditor wondering how to recover what they are owed. In New Jersey, the experienced collections attorneys at Snellings Law have helped many clients recover the compensation they are owed after receiving a bad check, and we can assist with your recovery needs, too. Call or contact our office today to learn more.

What to do if You Receive a Dishonored Check

If you have received a dishonored check, there are steps that you can take to preserve your claim for recovery. In some cases, simply contacting the party who wrote the bad check can resolve the problem with alternative payment. However, if payment by another means is not an option or if you cannot get in contact, a certified letter is required that must include the name of the party who wrote the check, the check date, and the amount. You must also specifically state that if the debt is not paid within 35 days, then legal action will be taken to recover the amount owed. 

If the writer of the bad check does not submit payment within the 35-day notice period, you should contact a collections attorney to pursue legal means of recovery. It is important to note that New Jersey law requires that a lawsuit be filed for a dishonored check recovery action within three years from the date of the dishonor or 10 years from the date that the check was written, whichever is earlier, in order to preserve the claim. Known as the statute of limitations, if a case is filed after that date, the court can throw out the lawsuit and bar recovery.

Compensation Recovery Options for Bad Checks

When you pursue a recovery action for a dishonored check, you are entitled to more than just the amount owed in the transaction. A creditor who receives a bad check can seek damages of $500 or three times the amount of the check, whichever is greater, along with additional compensation for attorneys’ fees, court costs, and additional fees required for the case. 

If the party who wrote the check lives or has assets outside of New Jersey, you may still have options for recovery of the dishonored check amount. Under the Uniform Enforcement of Foreign Judgments Act (UEFJA), a creditor in New Jersey can recover damages from a dishonored check across state lines. However, this can be a complicated process, which is why you should always utilize a knowledgeable collections attorney in these situations. A lawyer can represent your legal needs in a UEFJA action as well as pursue other means of recovery within New Jersey.

Why You Should Use an Attorney for Your Collection Action

There are many benefits to using a New Jersey collections attorney instead of a collections service when it comes to the recovery of dishonored checks. First and foremost, a collections attorney has more options available to recover your money as a creditor. In addition to all of the services provided by a collections service, a collections attorney can do everything they can as well as represent your interests in court with a legal action against the debtor. A collections attorney also understands the law and will ensure that your recovery action is filed within the statute of limitations to protect your claim.

In many cases, utilizing the services of a collections attorney also costs less than a traditional collections service. This is because a collections attorney can seek additional damages in a legal case, as opposed to a collections agency that can just collect the amount of the dishonored check. Finally, using a collections attorney often leads to a faster result than using a collections service. A collections attorney can begin immediate recovery actions such as liens, writs of executions, or levies on bank accounts, whereas collections services are limited in their means to recover the money you are owed from a bad check. 

Talk to Our Office Today

Receiving a bad check can have a devastating impact on transactions and business operations for creditors; you deserve to collect the money you are owed from a dishonored check. To learn more about your legal options for recovery, call the office or contact us at Snellings Law in Parsippany today to schedule a consultation of your case.