A bad check is a check that a bank refuses to honor. There are multiple reasons why a bank may take this course of action, including the following:
- The check is drawn on a non-existent bank account
- The account on which the check is drawn does not contain sufficient funds
- The check was not signed
- The check was not endorsed
Issuing a bad check is illegal, though many people write bad checks simply because they are unaware of the actual cash balance in their accounts. An individual can keep from writing bad checks by arranging for overdraft protection on his bank account, and by closely monitoring the balance in his account.
When a person does issue a bad check, the error is compounded because the bank will charge a hefty fee. In addition, the person's name might appear in the database of a check verification service, making it more difficult to pay with checks in the future.