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A cashier’s check is secure because the individual must first deposit the amount of the check into the issuing institution’s own account. The person or entity to whom the check is made out is guaranteed to receive the money when cashing the check. Although certified checks and cashier’s checks offer some additional security to both the check writer and the recipient, they aren’t foolproof.
Disadvantages of Cashier’s Checks
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A cashier’s check is a secure payment instrument issued by a bank or credit union. It guarantees payment to the recipient using the institution’s funds, making it similar to cash. Unlike personal checks, cashier’s checks are drawn on the bank’s own account rather than the payer’s account, ensuring immediate availability of funds. They are widely accepted for large transactions such as real estate purchases. The payee—the person receiving the funds—knows that the check won’t bounce, as it’s being drawn from the bank’s account.
Offer pros and cons are determined by our editorial team, based on independent research. The banks, lenders, and credit card companies are not responsible for any content posted on this site and do not endorse or guarantee any reviews. In general, cashier’s checks are among the safest payment methods available. But even with the security features they include, they’re not entirely immune to fraud. You can get a cashier’s check from any bank or credit union, but you may be required to be an existing customer to buy one. Whether you’re heading into a local branch or submitting your request online, here are some steps you’ll need to take.
- State law determines how long you have to deposit a cashier’s check, and in some states, they’re canceled after three to five years.
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- These checks may not have the same watermarks, making them easier to duplicate.
- If you want to withdraw the funds for a cashier’s check, though, you may be required to provide some form of identification.
- Real cashier’s checks are one of the safest forms of payment, but cashier’s check scams do exist.
Different types of transactions are suited to different types of payment. For larger transactions, providing (or receiving) a cashier’s check may be the best choice. If you need to make a payment of less than $1,000, money orders are a good option.
How much does a cashier’s check cost?
With a large personal check, the bank might place a hold of several days to allow the check time to clear. We went through our list of the best banks for small businesses and looked at some of the most popular banks in the US to find how much a cashier’s check is at each bank. The cost is typically around $5-10 per check, and we found that across 15 banks, the average cost for a cashier’s check was $8 per check. Gerald wants to buy a new apartment; the apartment cost is $90,000; he has the money in his account but, for safety reasons, decides to pay through a cashier’s check. He visits the bank where he has an account and what is a cashiers check requests a cashier’s check.
If you don’t need the cash right away, deposit the check into your account, and it should clear within three to five business days. A cashier’s check is one of your best options for paying for that house, boat, car, or any other large purchase. Many financial institutions do not enforce a limit for how much money can be issued through a cashier’s check. In fact, your escrow or title company is likely to require that you bring along a cashier’s check or certified check to the real estate closing table to cover your financial obligations.
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Depending on the bank, you may have to wait 30 to 90 days to receive a replacement cashier’s check. To get a cashier’s check, have a government-issued photo ID with you, such as a driver’s license. Have enough cash on hand or funds in your account to pay the bank the full amount of the check.
How To Get a Cashier’s Check?
Cashier’s checks are only available at banks and credit unions, and you typically have to be a customer to purchase one. Cashier’s checks and money orders are common ways to pay for purchases without using cash, debit cards or personal checks. People may use cashier’s checks or money orders because a vendor requires them or because they don’t want to carry around large amounts of cash.
Because cashier’s checks are checks issued by banks, they represent a guarantee of existing funds. Most banks give you the cashier’s check on the spot and the funds are typically available immediately. Cashier’s checks, certified checks and money orders all can be issued by banks or credit unions. The main difference between a money order and a cashier’s check or certified check is that you don’t necessarily need a bank account to purchase a money order. You can also get money orders at other locations, such as grocery stores or post offices. The check itself is written by a financial institution such as a bank or credit union against its own funds.
If you do need a cashier’s check, though, make sure you have the money and the information required, and treat the check the same as you would cash until you hand it to the recipient. At that point, they’re responsible for its safekeeping until they deposit or cash it. Our partners cannot pay us to guarantee favorable reviews of their products or services. Keep in mind that each one is different when it comes to convenience, speed and cost. A wire transfer makes it easy to send or receive money in a matter of hours, for example, but it can mean paying a steep wire transfer fee. To obtain a cashier’s check, you usually need to provide the recipient’s name, the amount of the check, and any other required information as specified by the issuing institution.