Even if a holder is aware that an instrument he or she is taking has been dishonored,the holder can still become a holder in due course by paying value for the instrument.

Dishonored

Refused; specifically, a payment that has been refused despite a holder presenting an instrument in a timely and proper manner.

Holder in Due Course

A legal term referring to a person who has acquired a negotiable instrument in good faith and for value, and thus has certain protections against defenses and claims that could be raised by prior parties.