Legal Question in Credit and Debt Law in Illinois

Is a statement on a check considered legally binding?

I recd a lump sum of money and wanted to pay down debt, but did not have enough for all debt. I decided to make a few of the oldest accounts an offer. I wrote a letter explaining I wanted to pay off and why and made an offer and sent offer check along with letter. On the front and back of the check I wrote ''Payment in full on account - final settlement''. The credit card company rejected the offer but cashed the check. The only purpose of sending the check was as final payment. Had they rejected the offer, they should have returned check as well. Is my statement on the check legally binding? Can I now insist they make my balance zero by accepting my check with the statement or must I continue paying on this debt?

Thank you.


Asked on 5/09/05, 11:50 am

1 Answer from Attorneys
Kevin Plachta The Law Office of Kevin F. Plachta

Re: Is a statement on a check considered legally binding?

This tactic is used all the time by those who owe money. The fact is that the creditor can cash the check without having to be bound by your settlement terms. Most judges find that for a settlement to be valid both parties have to agree to the SIF---the cashing of the check does not always prove there was agreement. Furthermore the creditor may of wrote on the signature line "with recourse" this would negate your settlement.

Bottom line is if you want to settle with a creditor then do it the right way. Remember no creditor is obligated to accept your settlement offers and by working with your creditors instead of trying to work against them the process is much easier.

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Answered on 5/09/05, 2:27 pm


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