What Is a Cashier’s Check?
A cashier’s check is a check drawn directly from a bank’s own funds in the bank’s name. It is typically signed by a teller, also known as a cashier, hence the name. Once a cashier’s check has been created, the bank is responsible for paying the amount on the check directly to the payee. This is in contrast to a personal check, which is drawn on your account and authorized by your signature.
How and Where Do I Get a Cashier’s Check?
There are two ways to obtain a cashier’s check: in person at a local bank branch or credit union or online from your financial institution.
Getting a cashier’s check is something most often accomplished offline and in-person, although some banks will allow account members to request cashier’s checks online and send it to the requester’s verified address. Unfortunately, this typically takes several or more days, so the benefit of a quick turnaround is lost with online cashier’s checks.
In order to purchase a cashier’s check the most common way, you’ll need to either go to your own financial institution or find one that will grant cashier’s checks to non-members through cash payment.
You’ll want to bring your ID and make sure you know all of the necessary information for the check: the payee’s name, the exact amount, and any notes that should be included.
The following steps detail everything you need to know about how to get a cashier’s check in person:
- Do some research online and determine whether or not your financial institution handles cashier’s checks in person, as most do. If you do not have a local banking branch or your bank doesn’t offer in-person services, find a local bank or credit union that will take cash payments from non-members for cashier’s checks.
- Before you head out to make your purchase, make sure you have all the information you need. You need to know the exact amount the check will be made out for, since the amount cannot be changed once the check is printed. Make sure you also know the correct spelling of the recipient’s name as identification will be required in order for the payee to cash the check. Finally, determine if you plan to add anything in the memo/notes line at the bottom of the check.
- Additionally, make sure you have all the items you need to bring on your person. You’ll need your own form of government identification, which the teller will likely ask for in order to confirm the purchase. If you are using cash, make sure you have this on hand or that there is some means to withdraw it at the bank or credit union you’re using. Cashier’s checks can also cost upwards of $15, so make sure you have cash to cover that price as well. If you plan to pay with funds from your account at the banking facility, double check your balance online.
- Once you have all essential information and items, go to your bank and stand in line or request to meet with a teller.
- Upon a face-to-face with the teller, ask for a cashier’s check and pay the exact amount you need it made out for. This can either be done in cash or you can have the money withdrawn from an account you hold at the financial institution. The entire process should take no longer than five minutes.
Why Use Cashier’s Check?
Cashier’s checks are often used for making large purchases when debit or credit cards aren’t always allowed, such as purchasing a home or vehicle. Since cashier’s checks must be cashed by the specific recipient noted on the check, they are an ideal way to carry large amounts of money with a very low risk of having it stolen. They are also rather difficult to counterfeit, as they usually have additional security features embedded into them.
Cashier’s check are also great for situations where the funds need to be available immediately, as the checks usually clear quickly (at least the first $5,000) because they money attached is backed by a bank of credit union.
Cashier’s Checks vs. Personal Check
While money orders and cashier’s checks are very similar and both offer secure ways to exchange money, they have some key differences: the amount for which they can be purchased, the availability of funds and the locations they are sold.
Cashier’s checks are frequently used for large purchases, and are often made out for hundreds or thousands of dollars. On the other hand, money orders have a maximum amount of $1,000. Purchase fees for cashier’s checks are also typically higher than those for money order, with money orders being as cheap as $1 and cashier’s checks usually costing about $10 or more.
Although both cashier’s checks and money orders both make funds available to recipients fairly quickly, the amounts made available tend to be quite different. For money orders, only $200 of the total amount is guaranteed to be available within a day, while cashier’s checks make $5,000 available within 24 hours.
The last major difference between cashier’s checks and money orders is where they can be purchased. Cashier’s checks can only be purchased through a bank or credit union while money orders can be bought at a variety of businesses, such as grocery stores, gas stations, post offices and more.
Cashier’s Checks vs. Certified Checks
The most significant difference between a cashier’s check and a certified check is how money is transferred.When a recipient deposits cashier’s check, money from the check is transferred from bank funds. With a certified check, money is transferred directly from the account of the person who sent the check.
A certified check is very similar to a personal check. However, a certified check is considered more reliable than a personal check because the writer’s bank certifies that the signature is authentic and that there are funds in the individual’s account to cover the amount it is written for. Both certified and cashier’s checks have been considered a safe payment method for a long time. Today, cashier’s checks are more popular and many retailers prefer a cashier’s check over a certified check.
Certified checks also typically have time stipulations attached and will be considered void after the specified time.
Cashier’s Checks vs. Wire Transfers
Wire transfers and cashier’s checks are both good choices for secure payments that need to be made quickly. While cashier’s check comes in the form of a piece of paper backed by a banking institution, wire transfers are entirely electronic. Wire transfers go from one financial institution to another through a wire network.
Generally, you must go to your bank to purchase a cashier’s check. Wire transfers can often be completed online, but can also be done by visiting a bank in person. If you want to wire money, your banking institution will provide a form to fill out. One item they will absolutely need is the routing number and account information for the transfer’s recipient.
Since wire transfers are immediate and dependable, they are also an ideal way of sending money overseas. That considered, you should never send money via wire transfer to someone you do not know, as they are a very common scamming tool.
Because cashier’s checks are paper, they can be lost. Your money will not be lost in wire transfer, but if you mess up the number sequence when providing it to a bank, you can lose wire transfer money as well. People who make wire transfers that are later determined to be scams rarely get their money back. In contrast, a cashier’s check can be reversed when fraud is determined.
The full amount of a wire transfer is usually available to the recipient within a day. This is often the case with cashier’s checks, but at the very least up to $5,000 should be accessible within one business day.
Cashier’s Check Scams
If you fall victim to a cashier’s check scam, you can potentially lose thousands. Scams involving cashier’s checks usually occur when you receive a fake check that appears real. You are then asked to send the check writer money or goods in return for that check. Scammers count on you not learning their check is fake until after you have sent them the requested funds or products. Once your bank determines the check is fraudulent, the original amount deposited is removed from your account. You then lose the money or the value of any items you sent the check writer.
To avoid depositing a fraudulent check, never accept checks from people you don’t know or trust. If this is not possible, verify the check’s authenticity before you deposit it. Since cashier’s checks are backed by banks, you can call the number of the financial institution listed on the check. They will be able to confirm whether or not the check is real. If the number doesn’t work, then you know the check is probably fake.
While cashier check fraud can happen in many different scenarios, some are more common than others. Here, we’ve detailed the most popular types of cashier check scams that you should watch out for.
Property rental cashier’s check scams occur when someone, often claiming to be from out of town, offers to pay the first and last month’s rent as well as the security deposit in the form of a fraudulent cashier’s check. After you have deposited this check, they claim something came up and they will no longer need the rental. They usually concede the security deposit is yours but ask you to wire the rent paid back. Once the fake nature of this check comes to light, you are out thousands.
Mystery shopper scams happen to individuals who believe they were legitimately hired to work as a mystery shopper. The company they’re working with will send a cashier’s check that you are told to use a portion of when purchasing items from the store you are mystery shopping. Then you are asked to transfer the remaining amount back to the company through a wire transfer. Like with any scam of this nature, once your bank determines the original cashier’s check is fraudulent, you’ve already wired money to the scammers, losing it.
Purchase of Goods or Services
If you agree to hand over goods or provide a service before a cashier’s check clears, you will be out the value of the products or service if the check turns out to be illegitimate. Confirm a check’s authenticity before handing over any items or providing an expensive or time consuming service.
Inheritance scams involve someone contacting you and explaining you’ve inherited a large sum from a long-lost relative. You give them your address, and they send you a fraudulent check, requesting only that you send them back a portion of the amount check is written for to cover their taxes and fees. By the time you find out the check is fake, you’re out all the money you sent them to cover their fake expenses.
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