How Will Check 21 Affect You?

You may already be familiar with Check 21, a federal law that goes into effect on October 28, 2004. If you're like me, this maybe something you hadn't heard about until just yesterday. TheCheck Clearing for the 21st Century Act, otherwise known as Check21, is the process of turning the checks your write into images andtransmitting them by computer.What does this mean to you?Expect the time your check clears to decrease drastically. If you livepaycheck to paycheck and often count on a one or two day "grace period" to getfunds into your account after paying bills, you'll need to re-organize your budgetingprocess. Checks will clear in a matter of hours now, not days.You will no longer be getting your cancelled checks back with yourbank statement. If you get anything at all, it will be a "substitute check" which is a certain kind of copy of your original check. You may be charged extra fees. It's possible that by using this method, your check will be paid twice: once with the original and once with thescanned image. Or there may be an error made in the amount a checkwas written for in the process of turning an paper check into an electroniccheck.What you should do:Re-organize your budget. You have to make sure that you have thefunds in your account to cover every check you write to avoid bouncingany checks.Request substitute checks. You will not be entitled to a credit to youraccount if an error has been made unless you have a substitute check.Balance your checkbook. If you are not in the habit of balancing yourcheckbook with your bank statement each month, you need to start.This will ensure that you'll find any mistakes that may have been made.Learn more. Consumer's Union did not support Check 21. Find out whyand learn more about Check 21 HERE