Post date definition
/What is Post Date?
Post date refers to the writing of a future date on a check. By doing so, the maker wants the payee to wait until the check date before cashing the instrument. This action effectively delays the payment of cash to the payee.
Why Post Date a Check?
The intent behind post dating a check is to force the payee to wait until the post date arrives before cashing the check. There are two reasons for doing so, which are as follows:
Not enough cash on hand. The payer does not currently have sufficient cash in his checking account, and so sets a future date in the expectation of adding more cash to his checking account that will then be used to fund the check.
More efficient payments. The payer cannot be bothered with a series of check payments to the payee, and instead issues all of the checks at once, with each check post dated to a successively later date. For example, a tenant could write 12 checks to his landlord at the beginning of the lease year, with each one dated to cover the check payment for each successive month of the year. The landlord is then instructed to cash the checks as they come due.
Examples of Post Dating
Here are three examples of post-dating checks:
Paycheck timing. An employer might issue checks to employees on a Friday but post-date them to the following Monday to ensure that payroll funds will be available. This practice gives the company a few extra days to manage cash flow without the risk of checks being cashed immediately.
Rent payment. A tenant who receives their salary a few days after rent is due might give their landlord a check post-dated to the payday. This allows the landlord to deposit the check once the tenant's account has sufficient funds, avoiding bounced checks and fees.
Installment payments. A customer purchasing an expensive item might provide the seller with a series of post-dated checks, each dated for the agreed-upon monthly payment date. This arrangement simplifies payment processing for the seller and helps the buyer manage cash flow.