Is marking “paid in full” on a check binding?

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Is marking “paid in full” on a check binding?

I owe creditors. If I send a personal check with an amount on the check put and “payoff”, is that a legal contract as paid off?

Asked on April 29, 2011 under Bankruptcy Law, Texas

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

Making such a notation on the memo line of a check is not legally binding. Therefore by cashing it your payee will give up none of their legal rights to collect the full sum owed (or allegedly owed).  The fact is that if someone owes money, they may not change the amount owed or terms of payment by merely making so marking a check.  The memo line on a check has no legal force. This is a common misconception.  This line is for informational purposes only.  While it helps to identify the reason that a check was written, it does not bind the recipient.  Think about it, if it was that easy to alter the terms of a payment people would be doing it all of the time.


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