When was the last time you wrote a personal check? It’s probably been a while.
With the financial world has been steadily moving away from paper checks, it seems logical that voided checks are becoming less important all the time. But are they?
Even though fewer consumers make payments by check, voided checks remain important.
That’s why it’s important to know how voided checks work, even if you don’t frequently pay by check, so that you remain protected when you use them.
What Is A Voided Check?
A voided check is a paper check with the word “void” written in large, bold letters across the face of the check. By writing void on the check, it means that the check is no longer available for use as a check. Should someone get the voided check, they wouldn’t be able to cash or deposit it.
There are several common situations when someone will ask for a voided check, which we will discuss in the next section, but properly voiding it will ensure you don’t get scammed.
When Will You Need To Voided A Check
The most common situation is if you make a mistake in filling out a check. In this case, just write “VOID” in big dark letters across the front of the check and it’ll be considered nullified. It’s now invalid for financial purposes.
Voided checks are also frequently requested when setting up recurring financial transactions because they contain all of your banking information.
Examples include the following:
Direct Deposit
Requesting a voided check is the usual way employers set up direct deposit into their employees’ checking accounts. Employers prefer this method because it lowers the cost of issuing paper checks, and reduces the number of personnel needed in the payroll department; after all, paper check systems are more labor intensive than electronic payment systems. Employees prefer direct deposit because it’s instantaneous and eliminates the need to wait for a paper check to clear their account.
By asking you for a check, they reduce the potential for errors. If you have to fill out a form and write in the information, it’s possible you make a mistake. If they have to read your handwriting, perhaps it’s not perfect and they make a mistake. By asking for a check, they skip one step.
Employers may not be the only entities you’ll have a direct deposit arrangement with. You may also need to provide a voided check to other organizations, such as the Social Security Administration, your pension administrator, investment accounts or insurance plans you’re taking monthly distributions from, or even the IRS for the payment of your tax refund. Direct deposit will be the preferred way for those institutions to make payment and for you to receive them quickly.
Recurring Payments
You may be requested to send a voided check if you want to set up an electronic payment method for certain bills. This is most commonly requested by vendors, merchants, and other service providers who want to set up an automatic payment system, in which they withdraw payments from your checking account on the monthly due date. That will eliminate the need for you either to issue a paper check in payment, or to go online and arrange the electronic payment manually.
Business Invoicing
If you’re self-employed, a freelancer, or you run a business, you may have certain clients you work with on an ongoing basis. To simplify and speed payment, you may set up an electronic billing and payment arrangement with that client. Setting up the arrangement may require you to provide a copy of a voided check so the client can establish the electronic link for payment purposes.
Recurring Personal Payments
Business firms and other organizations aren’t the only entities that may involve recurring personal payments. You may have a payment arrangement set up with another person, such as a family member, a friend, or even a landlord/tenant, to make recurring payments electronically.
If you’re the one making the payments, you may need a voided check from the other party to connect the accounts. If the other person is making the payments, he or she will need a voided check from you for the same purpose.
What’s Needed To Void A Check?
Voiding a check may seem as simple as just writing “void” across the front of the check, however, there are a few details you’ll need to keep in mind when writing out the word.
“Void” needs to be clearly visible on the check. It should be written across the entire check in large, preferably uppercase, letters. It should be written either with a dark pen or fine marker so that it will show clearly on the one hand, but still leave the important information intact on the check front.
The word should stand out from the pre-printing on the check, so it’s clear to anyone that the check’s been voided. If you make the lettering too fine, or you use a highlighter, a potential thief may be able to either erase or cover your writing, or in the case of a highlighter, simply copy the check, making the highlighting disappear.
Whatever you do, never sign a voided check or write any information in the blanks provided. The only purpose of a voided check is to provide your bank name, routing number, and personal account number. There’s no need to add any additional information to the check.
The best way to deliver a voided check is in person. That will ensure it reaches the intended party without passing through third-party hands. If in-person is not possible, a fax delivery is preferred to email. After all, an email can be accidentally forwarded to unintended parties, exposing your check information to multiple recipients.
Be Careful With Voided Checks
This is a seldom-discussed aspect of voided checks, but it’s critically important from an identity-theft-protection standpoint.
By writing “void” across the front of the check, you invalidate it for financial purposes. But is still provides several pieces of very important information that identity thieves love:
- The name of your bank.
- Your name, address, and sometimes your phone number.
- Your checking account number.
- A valid check number that hasn’t been used yet
- The check also contains your bank’s routing number; however, that information is public information if they know the state in which you opened the account.
The point is that a potential thief will have instant access to what is probably your primary financial account. This will open the possibility of accessing your account or even stealing your identity for other purposes.
For that reason, a voided check should never be provided lightly. They should be given only to individuals that are both trusted and necessary in your life. If any person or organization requests you to provide a voided check, be prepared to question them for the exact purpose. Unless it’s one of the usual reasons, you should never provide a voided check to anyone.
Are There Alternatives To Voided Checks?
What if you don’t have any paper checks and don’t want to order them for the sale purpose of voiding one to give away?
There are alternatives to voiding a check:
Deposit tickets. If your bank account provides deposit tickets but not checks, it’s usually an acceptable substitute. It contains the same information, the name of your bank, the bank routing number, and your personal account number. Best of all, since they’re designed for deposits, a potential thief can’t withdraw money from your account.
Counter checks. This is a fancy name for checks printed on demand for specific purposes at your bank or credit union. Banks typically charge a fee for these checks, which can be anywhere from a few dollars to as much as $25. But, if you normally have no need for paper checks, this can be a way to provide a voided check. Be sure to follow all the same steps you would to void a personal check.
A letter from your bank or credit union. You can request your financial institution send a letter providing all the same information to the party requesting your voided check. One of the advantages is that your bank or credit union may send the letter directly to the party requesting the voided check, avoiding the need to send it by email. Banks and credit unions are well instructed in methods of protecting personally identifying information, and will know the best way to send the letter safely to the intended party.
Verbal confirmation. Many small or less formal organizations may allow you to provide the information from your checking account directly to them in lieu of sending documentation. They don’t need a voided check, it’s just a convenient document. If you can provide your bank name, routing number, and your personal account number over the phone, it’s often good enough. Avoid sending this information in an email due to the security risks.
Be careful where you send one and how you send it—there’s always the possibility someone’s asking for a voided check with ill intent, or the delivery method may prove less than secure. In either case, you’ll be exposing yourself to the very real risks of identity theft.
Where possible, use alternatives to voided checks. As paper checks become less common in banking, organizations that normally require a voided check may be more receptive to another method. Try those first and you avoid the risk your sensitive financial information falls into the wrong hands.
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