Money Order vs Cashier’s Check: Limits, Cost, and More

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. You might need a cashier’s check to make a security deposit on an apartment, for example, or to cover the down payment on a new car. Consumers often use cashier’s checks to pay a merchant or vendor that requires cash and won’t accept personal checks. Cashier’s checks also are used in cash trades that must settle quickly, such as with real estate and brokerage transactions. If your cashier’s check is lost or stolen, call your bank as soon as possible to let them know.

Alternative Ways to Pay

Even if you’re not a customer, you can still try walking into a branch and asking for a cashier’s check. If it’s inconvenient for you to visit a bank, many supermarkets, pharmacies and convenience stores also sell cashier’s checks. Getting a cashier’s check is as easy as walking into your local bank or credit union and speaking with a teller.

Cashier’s Check: Definition, Benefits, and Alternative Options

Check the issuer’s requirements for providing a cashier’s check, including any limits. Banks may have cashier check limits, such as $250,000 per check or $500,000 daily. The cashier’s check process is also pretty straightforward at online banks. Generally, you’ll have to call customer support or see if you can make an order through online banking. A cashier’s check (also called an “official” check) is a type of bank-issued check where the bank itself guarantees that the funds will be available when the check is cashed. Let’s say you go to your bank and ask them to issue you a cashier’s check for $1,000.

You can also get money orders at other locations, such as grocery stores or post offices. You can purchase cashier’s checks at bank or credit union branch offices. Some financial institutions also make them available on their websites or by telephone. A bank might issue cashier’s checks to non-customers, but most probably will only issue them to customers. 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.

They also have more security features like watermarks, security threads, color-shifting ink, and special paper. For example, someone may send you a cashier’s check and then ask you to send back a portion via wire. The check will typically bounce, but not until after you’ve sent the wire, leaving you out of money. Money orders and cashier’s checks are both useful tools for making payments, and they even have a similar appearance. But there are significant differences between the two that might determine which is best for your needs. For example, cashier’s checks have higher limits, but they are only available from financial institutions.

What If a Cashier’s Check Is Lost or Stolen?

Julia Kagan is a financial/consumer journalist and former senior editor, personal finance, of Investopedia. Cashier’s checks and money orders do share several features that may make either one a good choice, all else being equal. Both of these instruments offer some form of protection if they get lost or stolen. If anybody pays you with one of these instruments and then asks you to return money, it’s most likely a scam.

We are compensated in exchange for placement of sponsored products and services, or by you clicking on certain links posted on our site. While we strive to provide a wide range of offers, Bankrate does not include information about every financial or credit product or service. The check itself is written by a financial institution tips for sales tax compliance in e such as a bank or credit union against its own funds. Cashier’s checks also may settle faster than personal checks because the bank’s funds are backing an authentic official bank check.

Cashier’s Check vs. Certified Check vs. Money Order

Here’s the lowdown on where to get a cashier’s check, what it costs, what information you need to provide, and more. Mark Henricks has written on mortgages, real estate and investing for many leading publications. He works from Austin, Texas, where he engages in songwriting, wilderness backpacking, whitewater kayaking and triathlons when not reporting on personal finance and small business. For major transactions, such as purchasing a car or home, you may want to file the receipt with your other papers related to the deal. The scammer may say that they’ve won a sweepstakes and they’ve sent you a cashier’s check with your reward. All you need to do is send back a small amount to cover taxes and fees.

When you ask for a cashier’s check, the bank will withdraw the money from your bank account and to the bank’s own funds. The bank guarantees your recipient will get the payment for the full amount. The cost of obtaining a cashier’s check varies depending on the institution, typically ranging from $5 to $15, although some banks may offer them for free to account holders. If there are not sufficient funds in the remitter’s account to cover the draft, the bank can return the check. This guide breaks down the basics of cashier’s checks, how they work and when you may want to use one in lieu of other payment methods. A cashier’s check is a safe, efficient payment method when a large sum of money is required.

The person or entity to whom the check is made out is guaranteed to receive the money when cashing the check. While that sounds simple enough, it can take time to secure an indemnity bond through an insurance company. And the bank may require you to wait 30 to 90 days before it will issue a replacement cashier’s check to give the original one time to be found. This can be inconvenient if you still need to make a is your small business accounting for inflation payment, but don’t have funds in your account to cover a new cashier’s check.

1. The bank fills in the “payable to” information, and only the designated payee should be able to cash the check.
2. You’ll likely need a certified check for a large transaction, such as making a down payment on a home, or to buy something from a stranger you met online.
3. And whichever you choose, the payee will have some peace of mind knowing that the funds are guaranteed.
4. It’s not impossible to get a cashier’s check from a bank that you’re not a customer of, but it may be hard to find a bank that will accommodate you.
5. Many banks will require you to have an account with them in order to get a cashier’s check.
6. You reach for a personal check, but the seller kindly asks for guaranteed funds, such as a cashier’s check.

If you can’t get a cashier’s check, or if a payee won’t accept one, there are other options for making large payments that offer varying levels of safety. If you don’t have a bank account, you can try calling different banks to see if they’ll allow you to purchase a cashier’s check without an account. If not, you may need to open a new bank account to get a cashier’s check or use a different form of payment. Credibility is another difference between money orders and cashier’s checks.

All users of our online services are subject to our Privacy Statement and agree to be bound by the Terms of Service. Scott Birrenkott, director of legal at the Wisconsin Bankers Association says to see if there’s anything suspicious about the item. The fraudsters are good, but the bank’s logo or ink could tell you there’s something off about the item.