New law sinks check floaters

OCTOBER 26, 2004 - The practice of "floating" a check until payday has become a thing of the past with the new federal "Check Clearing for the 21st Century Act," also known as Check 21. Although we know many young Airmen and their spouses are familiar with the practice, "Check floating" occurs when people write checks before there is money in their account. For example, when you visit the Commissary two days before payday and write a check for $150 -- when you know you only have $10 in your checking account -- that's floating a check.

Forget about writing those rubber checks for now on. With Check 21, money will be withdrawn immediately from a person's account when the check is written. This means that debits to a person's checking account will occur in minutes, not days.

The new federal law is designed to help banks efficiently process more checks electronically. This means that debits to a person’s checking account will occur in minutes, not days.

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