What is a Non-Sufficient Funds (NSF) Check?

Definition: A nonsufficient funds checks, more commonly referred to as a NSF check or hot check, is a check that was written on a bank account without enough money to pay the check. In other words, it’s a check that will bounce because there isn’t enough money in the account.

What Does NSF Check Mean?

We are all familiar with the concept of a bounced check. Someone writes us a check and there isn’t enough money in the bank account, so the bank won’t accept the check. This is what it looks like to us, but here is what actually happens.


Bill is a landscaper and does yard work for Tom during the summer. At the end of the month, Tom writes Bill a check for $100. The only problem is that Tom only has $50 in his account. When Bill goes to deposit the check in his account, his bank doesn’t necessarily look at Tom’s account balance to see if it will clear. Bill’s bank credits his account for the $100 and sends the canceled check to Tom’s bank.

This is where it gets tricky. Tom’s bank gets the check and says there isn’t enough money in the account, so they notify Bill’s bank that they aren’t going to transfer the funds. Now Bill’s bank debits his account $100 and attaches an NFS notification on his account.

Tom’s bank, on the other hand, doesn’t like that he wrote an NFS check, so they charge him a fee of $30 for having an overdraft account. It’s up to Tom to put another $50 in his checking account plus the $30 overdraft fee and write Bill a valid check.

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