Dealing with Bounced Checks: Tips for Managing Money in Your Home-Based Business

[dannyzmom]

I have had to deal with bounced checks twice in my almost-5-years in this business.

Both times it ticked me off something fierce...

So...let's talk money.
Home office encourages us to close shows within 3-4 days, right? Well, if I have a Friday night show, the checks get deposited on Monday. If there are NSF on any of those checks, I will not know until the FOLLOWING Friday. So, am I supposed to float $ for these people whom I don't even know??

There is buzz about having the guests make checks out to the host and getting one check from the host...I agree with Beth on this one. I don't want my whole show bouncing.

What are everyone's thoughts on how to handle this issue?

 

[chefann]

I don't have guests make checks out to the host. That makes hosting look like a hassle, and I don't want to do that. I do take checks to my bank the day after the show (my bank is open 7 days a week). And as much as I recommend it, I almost never end up closing shows in only 4 days, because the hosts always seem to have "one more order" coming in. But I've had fewer checks in the past year or so than when I first started, just because debit cards pull from the same account and are easier.If you would like to encourage card use, maybe you could offer $1 off orders that are paid with credit/debit cards. Then you don't have to worry about checks.

 

[BethCooks4U]

I have the checks written out to me. I encourage credit card/debit card payments. I pay for the show with my PC Credit Card. I always know that all the checks cleared before I have to pay the CC bill and I pay it in full and get bonus $$ for using it. No worries about going under in my checking account.

I have had about 6 checks bounce in 6 years. One of the orders was shipped to me and the guest (a past host - twice!) never returned my calls or emails. She just disappeared. I held onto that product way too long and missed the chance to send it back at no cost and ended up selling it at a loss.

ALL of the others immediately made good with me and paid (OFFERED TO PAY) the fees my bank charged.

I approach them with the attitude that there's probably an error with the number or something. Never accusing. And to a person they knew the check wouldn't clear when they wrote it. DUH. I still treated them well and when those that bounced checks had their own show or ordered again I privately kidded with them about it being good. And it always is.

Addendum: I try to close shows in 2-3 days but do allow hosts to take a little longer if they NEED it. I submit the show as soon as the checks are in my hands (but not necessarily in the bank).

 

[dannyzmom]

If you would like to encourage card use, maybe you could offer $1 off orders that are paid with credit/debit cards. Then you don't have to worry about checks.

Nah - I am just going to b*tch and moan for a few weeks since this latest bounced-check fiasco and then I'll gte over it again - LOL
I just need to piss and moan for a while...

 

[lacychef]

That incentive could be a good idea Ann, to get more to use their cards.
I have them make checks out to me too; I tell people I like to keep it easy for the hosts. Knock on wood, I've only had 2 checks come back in 6 1/2 years. (1 that I'm still awaiting payment on:grumpy

 

[lacychef]

Nah - I am just going to b*tch and moan for a few weeks since this latest bounced-check fiasco and then I'll gte over it again - LOL
I just need to piss and moan for a while...

This made me laugh!

 

[kaseydee]

Would it be possible to go to their banks & cash the checks? Our town has tons of banks & branches all over so much that I could just about drive down one street & hit a branch for each bank.

 

[BethCooks4U]

Would it be possible to go to their banks & cash the checks? Our town has tons of banks & branches all over so much that I could just about drive down one street & hit a branch for each bank.

I have done that. Especially when they say "cash it right away" or "wait until Friday". Some banks charge you to cash a check if you don't have an account but many don't.

 

[cathyskitchen]

Would it be possible to go to their banks & cash the checks? Our town has tons of banks & branches all over so much that I could just about drive down one street & hit a branch for each bank.

I know a Longaberger lady around here who does that. She tried to cash a $300 check from a fellow preschool mom on a Sunday, and the account had insufficient funds b/c the mom didn't think she'd deposit it until Monday, when she had planned to move the money from one account to another. I trust what this woman said, too, b/c I know for a fact she had LOADS of moola, so she wasn't hurting for money - she just needed a little time to get it into the account that she wrote the check from (she was spending LOTS of money at the school fundraiser, so she must have had to dip into another account, I guess). Anyway, I would just let them know that you're planning to cash the check at their bank branch on X day if you're going to do this, just to give them this courtesy (and avoid insufficient fund issues like that!).

 

[dannyzmom]

Sometimes it is feasible for me to go to their bank branches but oftentimes it is no -- like this most recent case...she banks at a credit union - I have no clue where their branches are...most likely in Miami where this show was (an hour away)

 

[stacywhitlow]

I have been fairly lucky in the check dept. Only had 2 in 5 years. 1 was bank error & the other was because she lost checkbook & stopped all payments. Both were paid immediately.

 

[merego]

I have them make checks payable to me and go to the bank the next day. Most pay with cash or credit/debit. The ones who have paid by check I know well, so I have not had any issues yet... knocking on wood!!!

 

[Intrepid_Chef]

I have had two RELATIVES bounce checks on me.If my own family would do this, why not a stranger? With this in mind ... I take every check to the bank on which it was drawn and cash the check (if they will do so without charging a fee) or verify funds, and immediately deposit them.I have never had a problem after I started doing this. It is a bit time consuming, but one time it paid off with a $500 show!

 

[rennea]

I am soo lucky, most of my customers pay by check and I have never had one bounce. I have had a CC decline though.

 

[PamperedK]

So....I had a credit card decline back in September. It was a $50 order...the order was shipped right to the guest and she kept promising to send me cheques, but never did...so I just ran her card again on a recent show...do you think that's bad??! I was told to do it by an upper-level Director, so...I did it. The show hasn't been processed yet so I don't know if it worked or not.

 

[katie0128]

I don't know if the laws are different up north, but I would think that would be paramount to theft. Nevermind the fact that I think it is unspeakably unethical.

 

[chefsteph07]

What's unethical?

 

[PamperedK]

I don't know if the laws are different up north, but I would think that would be paramount to theft. Nevermind the fact that I think it is unspeakably unethical.

Wait...what I did was theft or what she did was theft? She took $50 in product and never paid me...eta: I forgot to mention that I've been calling this woman for months and she tells me every time that she forgot to send the cheque and it's in the mail, etc...

 

[chefann]

I don't know if the laws are different up north, but I would think that would be paramount to theft. Nevermind the fact that I think it is unspeakably unethical.

What's unethical?

There was a post, although it seems to have been removed, about someone having a customer's card run later to cover a previous bad payment. With no warning to the customer that it was being run for that old debt.

 

[PamperedK]

There was a post, although it seems to have been removed, about someone having a customer's card run later to cover a previous bad payment. With no warning to the customer that it was being run for that old debt.

Sorry...I deleted my post until I can write it out properly. I wrote it quickly and it was clearly...not clear.

 

[PamperedK]

Ok here's the situation:I had a show back in September. I was given an outside order from the host - someone from work, I believe. She provided a credit card number for the order (approximately $50 before tax, shipping, etc...). The credit card was declined. I called the customer and she said it was no problem - she'd send a cheque in the mail the next day. Rather than hold up the entire order, I asked HO to release it and charge me. The cheque never came. The lady got her stuff. I called her a number of times, sometimes reaching her, sometimes not. When I did reach her, she apologized and said she forgot to send the cheque, and it would be in the mail the next day. I never received anything, called her a few times, never heard back...called the host, who said she had no other contact info for this lady and she doesn't really know her that well. I was going to send a letter with a self-addressed stamped envelope but I didn't have her mailing address - just the one you can find on 411 but since she's out in the country, that's not her mailing address - you need a PO Box. I was talking to an Upper Level (not mine) and she told me to try her card again. I didn't think much of it because, well...this lady owes me $50. I tried calling her a few more times, thinking I could just leave a message saying I was going to charge her...but no answer and no machine. The show hasn't been submitted yet and I'm starting to doubt that I should run it...however I feel like I'm owed this $50. It's not like I forgot to charge her or stopped calling her or anything...I just want to be paid. This $50 order barely covers the commission I made on that whole show!Wouldn't it be the customer that's stealing?? I mean, she got her products and never paid for them!

 

[chefann]

That's true, that she never paid for the products which is essentially stealing. But you should warn her that you're going to run the card again, even if it's just a message on her phone.

 

[PamperedK]

That's true, that she never paid for the products which is essentially stealing. But you should warn her that you're going to run the card again, even if it's just a message on her phone.

See, but I've tried to call a number of times and there's no voicemail. I can't mail her a letter and I don't have her email address. :cry:This is why I now tell all my hosts I can't process orders without an address.

 

[chefann]

Ooh - that's tricky. The fact that you can't contact her changes the whole dynamic.

 

[PamperedK]

Ooh - that's tricky. The fact that you can't contact her changes the whole dynamic.

Yeah...I really wasn't clear the first time. That's what I get for typing and trying to pack at the same time.

 

[chefsteph07]

I may get slammed for this, but I think you did the right thing, and I'd prob do it too!

What's unethical is a customer receiving a product that she knew she didn't pay for and think she could run away with it without being caught. The consultant had her credit card number, I think that the customer should have EXPECTED her to run the card until she got payment!

Isn't Carolyn going through kind of the same situation? Something about the customer having the funds next week but received the prods already? ...I said in one of my posts to keep running it till she gets it..I think any other "business" would do the same, and I dont think they are being unethical for doing so.

 

[PamperedK]

I may get slammed for this, but I think you did the right thing, and I'd prob do it too!

What's unethical is a customer receiving a product that she knew she didn't pay for and think she could run away with it without being caught. The consultant had her credit card number, I think that the customer should have EXPECTED her to run the card until she got payment!

Isn't Carolyn going through kind of the same situation? Something about the customer having the funds next week but received the prods already? ...I said in one of my posts to keep running it till she gets it..I think any other "business" would do the same, and I dont think they are being unethical for doing so.

See this is why I'm torn. It is a business. You can't just go around stores and take products without paying for them. It would be "essentially" stealing. It would be stealing.

However, I know I'd be upset if my card had a charge show up all of a sudden. But then I would never take products without paying for them.

I know it probably varies, but do you know if there is some kind of rule as to how long after purchase can your card be charged??? Should I maybe call the card company directly and ask?

 

[stefani2]

OT - Winnipegk - how do you NOT have email???

 

[PamperedK]

OT - Winnipegk - how do you NOT have email???

I have email - she doesn't have email. (edited my post)

 

[chefsteph07]

See this is why I'm torn. It is a business. You can't just go around stores and take products without paying for them. It would be "essentially" stealing. It would be stealing.

However, I know I'd be upset if my card had a charge show up all of a sudden. But then I would never take products without paying for them.

I know it probably varies, but do you know if there is some kind of rule as to how long after purchase can your card be charged??? Should I maybe call the card company directly and ask?

So what if she's upset?
Would you expect anything less if YOU did the same thing as this customer?
I'd probably say to myself that I had it coming since I knew I didn't pay for it. If you don't have her info, any of it, then let HER contact YOU if she wants to dispute or argue about anything. I seriously would NOT lose sleep over this, she finally paid for it and now you can be done w/ the whole thing.
Why did she give you her card number if she didn't expect to be charged?

 

[chefsteph07]

Ok, is there anyone who knows this person (past host, friends at party that she bought the product) that you can contact to try to get in touch w/ her?
If so, try that route and give her a call, or better yet, send her a letter (certified) explaining that after all these months you felt it necessary to receive payment for the products that she took and promised to pay for, but never did. If it is weighing on you that much. If there is no way to reach her, I'd let it go until she got in touch with YOU. Was it a debit card out of checking or a credit card? I can't remember if you stated that.

 

[pckrissy]

I handle bounced checks like Beth stated above, not accusing them of having no money and giving me a bad check but "bank error", this has only happened to me about 3 times. But still each time is annoying and I never am 100% I am going to get my $$...right now it's 50/50...first one--never recv'd the $$, second -got my $$ plus bank fee, third- i'm actually still waiting on...let's keep our fingers crossed..she's is supposed to be sending the $$ plus bank fee (which luckily for me my bank only charged $7!!!)
I must say I LOVE MY PC BIZ but this is definately not one of my favorite parts!
Good luck Carolyn getting your $$ or products this weekend...I know this issue has really made you see RED!

 

[PamperedK]

Ok, is there anyone who knows this person (past host, friends at party that she bought the product) that you can contact to try to get in touch w/ her?
If so, try that route and give her a call, or better yet, send her a letter (certified) explaining that after all these months you felt it necessary to receive payment for the products that she took and promised to pay for, but never did. If it is weighing on you that much. If there is no way to reach her, I'd let it go until she got in touch with YOU. Was it a debit card out of checking or a credit card? I can't remember if you stated that.

It was a credit card.

 

[chefsteph07]

Well then I really wouldn't worry much about it...
Wait and see if she contact you..I doubt she will!

Carolyn, good luck w/ the customer this weekend if she shows up...
We really do need to start "encouraging" credit cards or debit instead of checks. At least that way we have the number to try to keep getting the payments...

 

[pckrissy]

Is this a dumb question? How do you charge someone's card for the products after the show has closed? I do have baby brain and a lack of sleep..so if the answer is obvious and I am slow..please forgive me...but seriously how do you?

 

[smspamperedchef]

You just call H.O. and they will do a "switch payment" Charge their card and credit back to you on your PC debit/credit card.

I personally think you should charge them. They authorized you to charge them. They said they would pay you. You contacted them and attempted to contact them multiple times. They disappeared. You have the legal right to do that. I can guarantee that if you can't get a hold of them now they will surely get a hold of you after they are charged! LOL! DO IT! We are not in the business of spotting people money to cover their money issues! Let us know what you decide!

 

[pckrissy]

You just call H.O. and they will do a "switch payment" Charge their card and credit back to you on your PC debit/credit card.
I personally think you should charge them. They authorized you to charge them. They said they would pay you. You contacted them and attempted to contact them multiple times. They disappeared. You have the legal right to do that. I can guarantee that if you can't get a hold of them now they will surely get a hold of you after they are charged! LOL! DO IT! We are not in the business of spotting people money to cover their money issues! Let us know what you decide!

Thanks Sharon, I neve knew that. I don't usually have credit cards decline, maybe once and I can't remember how we resolved it..I think they just gave me another card. But this is good info to know!

 

[dannyzmom]

You just call H.O. and they will do a "switch payment" Charge their card and credit back to you on your PC debit/credit card.

I personally think you should charge them. They authorized you to charge them. They said they would pay you. You contacted them and attempted to contact them multiple times. They disappeared. You have the legal right to do that. I can guarantee that if you can't get a hold of them now they will surely get a hold of you after they are charged! LOL! DO IT! We are not in the business of spotting people money to cover their money issues! Let us know what you decide!

This is how I ended up in this current mess. She gave me a useless check. The show was already processing - I called HO and had them change her payemt to charge card -- and her card was declined, too

 

[chefsteph07]

This is how I ended up in this current mess. She gave me a useless check. The show was already processing - I called HO and had them change her payemt to charge card -- and her card was declined, too

I would just keep trying to charge them each Friday until it goes through

 

[JAE]

Carolyn, I hope you get your money, ASAP, and I hope you get a long break from this sort of thing happening to you again. It would be nice if you never had to deal with this again.

Winnipegk, if HO will run the card, then have them run the card. It isn't unethical if she gave you the card number IMO.

 

[jrny2001]

I had a show last month with 2 people that bounced checks. I was able to get a hold of them and kindly asked them to pay the bank fee. Luckily I was able to get the money before the products were delivered.

I would have the host hold onto the stuff until you get your money, or even better get it off her. Then you can hand it over when you get the cash.

Good Luck!

 

[chefjeanine]

I always know that all the checks cleared before I have to pay the CC bill

Okay all you people in the field of banking, my understanding (according to my bank several years ago) is that it takes weeks before we know if a check actually has cleared. Perhaps now that we have more electronic transactions this has changed but if not, I think we should be aware. I've only had two checks bounce on me in my nearly 500 shows/orders but, it was at least a week after the fact that I became aware that they did not clear.

Has this changed?

 

[bsaxman]

I have had to deal with bounced checks twice in my almost-5-years in this business.

Both times it ticked me off something fierce...

So...let's talk money.
Home office encourages us to close shows within 3-4 days, right? Well, if I have a Friday night show, the checks get deposited on Monday. If there are NSF on any of those checks, I will not know until the FOLLOWING Friday. So, am I supposed to float $ for these people whom I don't even know??

There is buzz about having the guests make checks out to the host and getting one check from the host...I agree with Beth on this one. I don't want my whole show bouncing.

What are everyone's thoughts on how to handle this issue?

I just co-hosted a Princess House show, and the host had people all write their checks to us instead of her, and all I can say is that it was a big hassle! Hosting a show should be easy and risk-free! You know? I did not enjoy hosting for PH and probably won't again. The way I see it, it is my responsibility (as a consultant) to handle the money and I would never want to bring my host into financial issues unless it were ane extreme circumstance. I also tell everyone at the end of the show that I prefer credit card payment but will also accept cash or check. Since I have started doing that, I barely get any checks at all.

The decision is up to each consultant how they would like to handle the money, and the decision my be different for each of us, but I prefer to handle the finances in all aspects.

 

[BethCooks4U]

Okay all you people in the field of banking, my understanding (according to my bank several years ago) is that it takes weeks before we know if a check actually has cleared. Perhaps now that we have more electronic transactions this has changed but if not, I think we should be aware. I've only had two checks bounce on me in my nearly 500 shows/orders but, it was at least a week after the fact that I became aware that they did not clear.

Has this changed?

Exactly why I use the PC credit card to pay for my shows - it gives me more time to know that all is cleared before it comes out of my checking account.

 

[chefjeanine]

Exactly why I use the PC credit card to pay for my shows - it gives me more time to know that all is cleared before it comes out of my checking account.

Thanks Beth. I thought you meant that you knew for sure those checks had cleared.

 

[kaseydee]

I took a lot of gold jewelry I haven't worn in years to a pawn shop buying gold & got $675. For things I couldn't tell you the last time I wore them I think that is pretty good.

 

[chefsteph07]

Carolyn, did you see that guest this weekend that owed you???

 

[dannyzmom]

Carolyn, did you see that guest this weekend that owed you???

Yes...she paid me the $ owed from the check (in cash) plus the bank fee. She apologized up, down & backwards, too.

 

[PamperedK]

Well, the card declined so it doesn't matter.

 

[dannyzmom]

You mean when you tried to re-run it?

 

[PamperedK]

Yeah. I just tried it and it declined. I think it was a mistake to do that too because now my show is on hold and I needed it for sell-a-thon.

 

[chefann]

As long as it's resolved by the deadline HO gives you, it'll still count for Sell a Thon.