Cashing bad checks - Posted by Mike

Posted by Dave T on July 17, 2002 at 16:46:43:

I don’t believe that plot line was included in one of the TV episodes. Nevertheless, I do remember reading it in one of the Perry Mason mystery books.

Cashing bad checks - Posted by Mike

Posted by Mike on July 16, 2002 at 20:02:01:


A few years ago I heard Wright Thurston speak at a conference. He gave out a useful piece of info. on how to take a tenants rent check that didn’t have enough in the account to cover the check and cash it for whatever amount is really in the account.

I remember it had something to do with asking the teller at the tenants bank if there was enough in the account to cover a check for X amount of dollars. If there was not, you would go back and ask if the check would cover a lesser amount and so on until you find the right amount that would cash.

Obviously, you can’t get all your money, but part of it is better than none.


Surprise surprise - Posted by John Behle

Posted by John Behle on July 17, 2002 at 13:21:24:

Many times a tenant or someone else will write a check that they can’t or even don’t intend to honor. Yet, they want to continue to use the account and make sure they keep less funds in the account than needed. In some cases, it can be un-intentional. The check might have cleared, except some bank fee, automatic debit or something causes it to be just a few dollars short.

Either way, you can call a teller or use the automated line at the bank to see if a lesser amount would clear. It’s easier nowadays because you can do it over the phone with their voicemail system that allows merchants to check if a check will clear. So, if you have a check for $500, you might check to see if $475 will clear and if not, $450, etc.

Let’s say $475 will clear. You can go down to the bank, deposit $25 and then cash your check for $500. You may not be able to collect the $25 later and they may actually get an attitude about what you did (after they bounce a check to you!), But, if it looks like you may not have an easy time collecting the full $500, it may be worth it and might be cheaper than the hassle and expense of collecting other ways.

I always love it when techniques of mine come back around with someone else’s name on it.

I learned that from a collection company in the very early 80’s. I taught it in my seminars and included it in the original 1982 version of the PaperGame book.

I joked and speculated with the collection company about how nice it could be to actually find out the exact amount in the account so that the $500 check would leave it at zero balance, which sometimes triggered the bank to automatically close the account.

A newsletter publisher then included this technique in his newsletter without giving credit to the source, so in a sense, I guess it enters the public domain.

Anyway, enough of that. It just irks me sometimes when other people’s ideas and techniques are portrayed as being the wonderful, original creative thinking of the course venders that package up other people’s ideas, experiences, techniques and material in a pretty package and sell it as some new thing.

Re: Cashing bad checks - Posted by Jack

Posted by Jack on July 16, 2002 at 20:10:16:

What we would do is if the bad check was for, say $500.00 and the tenant had 450 in the account, we would deposit to their account the 50 bucks and then cash the $500.00, On the deposit slip we wrote “loan” and then went to small claims court if they did not repay the $50.PLUS the bounced check charges they incurred pursuant to the lease.

Usually we had no problem.

Small world - Posted by GL(ON)

Posted by GL(ON) on July 17, 2002 at 14:16:07:

I first learned this trick from a real estate broker in Port Hope Ontario in the late 70’s. I thought it was common knowlege in banking circles. Only once have I run into a teller who didn’t know about it, and she was pretty green. Other than her, all the bankers seem familiar with it, even out here in the boondocks.

Re: Cashing bad checks - Posted by Mike

Posted by Mike on July 16, 2002 at 20:40:53:


Yes. That’s what I wondering. I couldn’t remember the procedure that Wright had explained. One more question. How do you know the tenant had say $450 in the bank instead of the full $500. I have a check from my tenant, but I know there’s less money in the account because I asked the teller if this check would clear. It won’t, but I have no idea what amount will clear.

Any ideas?


Re: Small world - Posted by John Behle

Posted by John Behle on July 17, 2002 at 14:33:37:

I had never heard of it before I began teaching it and no one else had it included in their seminars, books, etc. Interesting though that he uses the exact numbers from my course.

I guess it just touched a nerve. My ads I created have ended up in other people’s best sellers, three people have tried to capitalize on my book title, and many techniques have ended up in other people’s courses. Some march around like they created the concept of discounted mortgage investment or creative real estate formulas and techniques when all they have ever done is re-package someone else’s material.

95% of what is out there today was developed in the exchange and creative finance world of the late 70’ and early 80’s. Most of the courses you see today are re-packaged techniques from the Miller and Schaub course, Warren Harding, Chuck Considine, Dee Fountain, Barney Zick and others. And, of course, much of what they learned came from other places too.

Re: Cashing bad checks - Posted by GL(ON)

Posted by GL(ON) on July 16, 2002 at 21:38:12:

They won’t tell you what is in someone else’s account but after they tell you they can’t cash the check, you can ask “If I put in $20 could you cash it then? $50? $75?”. At some point they either stop shaking their head or say " It doesn’t matter how much you put in".

By the way you can take the check to your own bank and ask them to resubmit it, they will resubmit it every day for 15 days and if the money ever shows up, they cash it. At least they will do this around here.

They don’t charge for this unless they get the money, then the fee is only a couple of bucks.

Re: Small world - Posted by GL(ON)

Posted by GL(ON) on July 17, 2002 at 16:28:41:

I’m sure a lot of “gurus” simply repackage other people’s material. There was a scandal a couple of years ago where Anthony Robbins ripped off Wade Cook’s stock market materials LOL. The Nothing Down boys in the 80’s were famous for this kind of thing.

It’s hard to say who invented what or used it first. The oldest example of a “nothing down” real estate deal that I can document, was one done by Thomas DeQuincy (author of “Confessions of an English Opium Eater”) He bought 2 houses in the Lakes District, one in town and one in the country, using all borrowed money, with a balloon payment in 7 years. He wound up losing the houses but he lived in them for 7 years. Sounds like some of the gurus of the '80s but this took place in the 1820’s LOL. I also know of other nothing down deals in the 1950’s.

Mark Twain wrote about how a working man with $100 in savings could buy 10 town lots worth $100 each by putting down $10 on each, with one year to come up with the balance, then sell them for $200 or more before the year was up. He said this was a common thing, repeated again and again in growning towns and cities across the United States through the 19th century.

Re: Small world - Posted by Dave T

Posted by Dave T on July 17, 2002 at 16:02:45:

Erle Stanley Gardner, in one of his famous Perry Mason books from the 1950s, has a client with a $125K check. Unfortunately the checking account owner had died and somehow his will overlooked $50K that was deposited into the account after the will had been probated.

Perry Mason goes to the bank loan officer and borrows $75K, deposits the money into the checking account, then cashes the $125K check. He repays the loan plus one day’s interest, and gives the rest of the cash to his client.

Re: Cashing bad checks - Posted by Nate(DC)

Posted by Nate(DC) on July 16, 2002 at 23:08:29:

Most banks print the account balance on the deposit receipt when making a deposit. You could deposit a very small amount like $1.00 and see what the balance is.

There is one exception, a small bank I used to bank with here that would only give you the balance if you showed ID to prove you were the account holder. I guess the thinking was that anyone could make a deposit to your account but only you have the right to know the balance. If the tenant wrote a check from that bank I guess you would be out of luck!


Re: Small world - Posted by John Behle

Posted by John Behle on July 17, 2002 at 16:20:21:

I should have picked it up from that. I probably watched every Perry Mason episode as a kid. AND…I’m sure that’s where Wright learned it too. The same numbers must just be coincidence.

Re: Cashing bad checks - Posted by bedros

Posted by bedros on July 16, 2002 at 23:41:47:

maybe you could call the check in and ask if the check is good for a lesser ampuont and keep calling back till you nail it down or just go lower and lower if they are giving you info. you can call to find out if the check is good. that way they cant see you and you can call any times till you find out.