diff --git a/matlab/dynare_estimation_1.m b/matlab/dynare_estimation_1.m
index 01ad20056..769723a39 100644
--- a/matlab/dynare_estimation_1.m
+++ b/matlab/dynare_estimation_1.m
@@ -513,6 +513,24 @@ if ~options_.mh_posterior_mode_estimation && options_.cova_compute
         disp('=> posterior variance of the estimated parameters are not positive.')
         disp('You should  try  to change the initial values of the parameters using')
         disp('the estimated_params_init block, or use another optimization routine.')
+        params_at_bound=find(xparam1==ub | xparam1==lb);
+        if ~isempty(params_at_bound)
+            for ii=1:length(params_at_bound)
+            params_at_bound_name{ii,1}=get_the_name(ii,0,M_,estim_params_,options_);
+            end
+            disp_string=[params_at_bound_name{1,:}];
+            for ii=2:size(params_at_bound_name,1)
+                disp_string=[disp_string,', ',params_at_bound_name{ii,:}];
+            end
+            fprintf('\nThe following parameters are at the prior bound: %s\n', disp_string)
+            fprintf('Some potential solutions are:\n')
+            fprintf('   - Check your model for mistakes.\n')
+            fprintf('   - Check whether model and data are consistent (correct observation equation).\n')
+            fprintf('   - Shut off prior_trunc.\n')
+            fprintf('   - Use a different mode_compute like 6 or 9.\n')
+            fprintf('   - Check whether the parameters estimated are identified.\n')
+            fprintf('   - Increase the informativeness of the prior.\n')
+        end
         warning('The results below are most likely wrong!');
     end
 end
@@ -578,11 +596,14 @@ if (any(bayestopt_.pshape  >0 ) && options_.mh_replic) || ...
     bounds(:,2)=min(bounds(:,2),ub);
     bayestopt_.lb = bounds(:,1);
     bayestopt_.ub = bounds(:,2);
-    if any(xparam1 < bounds(:,1)) || any(xparam1 > bounds(:,2))
-        outside_bound_vars=bayestopt_.name([find(xparam1 < bounds(:,1)); find(xparam1 > bounds(:,2))],:);
-        disp_string=[outside_bound_vars{1,:}];
-        for ii=2:size(outside_bound_vars,1)
-            disp_string=[disp_string,', ',outside_bound_vars{ii,:}];
+    outside_bound_pars=find(xparam1 < bounds(:,1) | xparam1 > bounds(:,2));
+    if ~isempty(outside_bound_pars)
+        for ii=1:length(outside_bound_pars)
+            outside_bound_par_names{ii,1}=get_the_name(ii,0,M_,estim_params_,options_);
+        end
+        disp_string=[outside_bound_par_names{1,:}];
+        for ii=2:size(outside_bound_par_names,1)
+            disp_string=[disp_string,', ',outside_bound_par_names{ii,:}];
         end
         error(['Mode value(s) of ', disp_string ,' are outside parameter bounds. Potentially, you should set prior_trunc=0.'])
     end
diff --git a/matlab/dynare_estimation_init.m b/matlab/dynare_estimation_init.m
index 9626306e7..ea551f0bf 100644
--- a/matlab/dynare_estimation_init.m
+++ b/matlab/dynare_estimation_init.m
@@ -146,11 +146,14 @@ if ~isempty(estim_params_)
     end
     % Test if initial values of the estimated parameters are all between
     % the prior lower and upper bounds.
-    if any(xparam1 < bounds(:,1)) || any(xparam1 > bounds(:,2))
-        outside_bound_vars=bayestopt_.name([find(xparam1 < bounds(:,1)); find(xparam1 > bounds(:,2))],:);
-        disp_string=[outside_bound_vars{1,:}];
-        for ii=2:size(outside_bound_vars,1)
-            disp_string=[disp_string,', ',outside_bound_vars{ii,:}];
+    outside_bound_pars=find(xparam1 < bounds(:,1) | xparam1 > bounds(:,2));
+    if ~isempty(outside_bound_pars)
+        for ii=1:length(outside_bound_pars)
+            outside_bound_par_names{ii,1}=get_the_name(ii,0,M_,estim_params_,options_);
+        end
+        disp_string=[outside_bound_par_names{1,:}];
+        for ii=2:size(outside_bound_par_names,1)
+            disp_string=[disp_string,', ',outside_bound_par_names{ii,:}];
         end
         error(['Initial value(s) of ', disp_string ,' are outside parameter bounds. Potentially, you should set prior_trunc=0. If you used the mode_file-option, check whether your mode-file is consistent with the priors.'])
     end
diff --git a/matlab/mode_check.m b/matlab/mode_check.m
index e7591e21d..a8e06a32d 100644
--- a/matlab/mode_check.m
+++ b/matlab/mode_check.m
@@ -109,15 +109,24 @@ for plt = 1:nbplt,
             end
         end
         xx = x;
-        l1 = max(BayesInfo.lb(kk),(1-sign(x(kk))*ll)*x(kk)); m1 = 0;
-        l2 = min(BayesInfo.ub(kk),(1+sign(x(kk))*ll)*x(kk));
-        if DynareOptions.mode_check.symmetric_plots,
-            if l2<(1+ll)*x(kk)
-                l1 = x(kk) - (l2-x(kk));
+        l1 = max(BayesInfo.lb(kk),(1-sign(x(kk))*ll)*x(kk)); m1 = 0; %lower bound
+        l2 = min(BayesInfo.ub(kk),(1+sign(x(kk))*ll)*x(kk)); %upper bound
+        binding_lower_bound=0;
+        binding_upper_bound=0;
+        if isequal(x(kk),BayesInfo.lb(kk))
+            binding_lower_bound=1;
+            bound_value=BayesInfo.lb(kk);
+        elseif isequal(x(kk),BayesInfo.ub(kk))
+            binding_upper_bound=1;
+            bound_value=BayesInfo.ub(kk);           
+        end      
+        if DynareOptions.mode_check.symmetric_plots && ~binding_lower_bound && ~binding_upper_bound
+            if l2<(1+ll)*x(kk) %test whether upper bound is too small due to prior binding
+                l1 = x(kk) - (l2-x(kk)); %adjust lower bound to become closer
                 m1 = 1;
             end
-            if ~m1 && (l1>(1-ll)*x(kk)) && (x(kk)+(x(kk)-l1)<BayesInfo.ub(kk))
-                l2 = x(kk) + (x(kk)-l1);
+            if ~m1 && (l1>(1-ll)*x(kk)) && (x(kk)+(x(kk)-l1)<BayesInfo.ub(kk)) % if lower bound was truncated and using difference from lower bound does not violate upper bound
+                l2 = x(kk) + (x(kk)-l1); %set upper bound to same distance as lower bound
             end
         end
         z1 = l1:((x(kk)-l1)/(DynareOptions.mode_check.number_of_points/2)):x(kk);
@@ -149,8 +158,13 @@ for plt = 1:nbplt,
         yNaN = yl(1)*ones(size(NaN_index));
         plot(zNaN,yNaN,'o','MarkerEdgeColor','r','MarkerFaceColor','r','MarkerSize',6);
         title(name,'interpreter','none')
-        hold off
         axis tight
+        if binding_lower_bound || binding_upper_bound
+            xl=get(gca,'xlim');
+            plot( [bound_value bound_value], yl, 'r--', 'LineWidth', 1)
+            xlim([xl(1)-0.5*binding_lower_bound*(xl(2)-xl(1)) xl(2)+0.5*binding_upper_bound*(xl(2)-xl(1))])
+        end
+        hold off
         drawnow
     end
     if DynareOptions.mode_check.nolik==0,