A cashier’s check is a check that is issued by the bank and the money is withdrawn from the bank’s account and not your account. This type of check is best to make purchases of items such as; cars and houses. A transaction done using a cashier’s check is more secure than regular check payments. A cashier’s check is also known as or can be called an official check. Let us see what a cashier’s check is in more detail and see where you can issue a cashier’s check.
What Is A Cashier’s Check?
In simpler words, a cashier’s check is a safe way to make large transactions. The check is written by the bank or the financial institution itself. When issuing a cashier’s check, the dedicated amount is transferred to the bank’s account, and then a teller or cashier signs the check to the third party.
If a person orders a cashier’s check, the person pays for the total face value of the check. The bank may also charge a small convenience fee and check fee. A check fee is a cost to issue a cashier’s check (some banks charge this and some banks do not). A cashier’s check includes both; the remitter and the recipient’s name. A cashier’s check may have one or more signatures of authorities, this varies from bank to bank.
But, How Is It More Secure?
A cashier’s check will never bounce. A cashier’s check has a signature from bank authorities and has watermarks that make it hard to counterfeit. A payment done using a cashier’s check is usually completed on the next business day itself.
How Does A Cashier’s Check Work?
A person can use an official or cashier checks in place of a personal check to ensure that funds are available for payment.
Cashier checks are safe as; the amount is deposited in the bank or the financial institution’s account. The individual or group that needs to be paid with the check is guaranteed to receive the money when the check is settled.
Cashier checks have many advantages. The recipient (the person receiving the money) knows that the check will not bounce because it has been debited from the bank account. Cashier’s checks are usually watermarked and require the signatures of one or more bank officials, so banks assure that their checks cannot be forged.
As checks are not withdrawn from your account, you do not have to worry about providing your personal account information to the recipient. Finally, funds are usually available the very next business day. Similarly, for large personal checks, the bank may take several days to settle up the check.
Do All Banks Give Cashier’s Checks?
As discussed previously, a cashier check is a check issued by the bank and the money is withdrawn from the bank’s account. Most banks and other financial institutions such as; credit unions around the United States give customers the facility of issuing a cashier check.
However, each bank or financial institution has different policies regarding a cashier check. Some banks charge you for a cashier check, but some banks provide it for no cost. Most banks only provide such services to their customers only.
Here are some banks that give cashier checks and their charges:
Bank of America – $15Ally Bank – FREEChase Bank – $8Discover Bank – FREEPentagon federal credit union – FREEPNC Bank – $10Santander Bank – $10Wells Fargo – $10
A cashier’s check is a safe way to conduct large transactions, but there have been cases of scams that have taken place using a cashier’s check. Let us see:
Cashier’s Check Scam:
A famous incident of a scam is where the victim received a letter stating that he was chosen to work as a mystery shopper. The letter contained a banker’s check that the victim could use to purchase goods during a mystery shopping excursion, send a part of the check to a third party, and keep the rest as a payment. I am instructing the victim. To be successful, the fraudster relied on the victim to wire the money before discovering that a bank check was fake.
A banker or cashier’s check is indeed secure, but scams can take place and it is your duty to be aware of it and not fall into the traps of fraudsters.
Conclusion:
A cashier’s check is a check issued by the bank. The amount is transferred from the customer’s bank account to the bank’s account, then the third party is paid through the bank’s account. A cashier’s check is safer than other forms of payment and it is usually used for large purchases. Most banks and financial institutions provide cashier’s checks at a fee or even free.
Q) Which is better, money order or a cashier’s check?
A cashier’s check is more secure which makes it better for conducting large transactions. A money order is usually cheaper to get and good for smaller transactions such as; paying rent.
Q) How to avoid cashier’s check fraud?
The simple answer would be to avoid accepting a cashier’s check from someone you do not know.
