Cashier’s Checks: What You Need to Know

Suppose you want to buy a car, make a down payment to purchase a home or pay the first and last month’s rent to lease an apartment. You may be unable to use a personal check or credit card for these transactions, and you don’t want to walk into a dealership or leasing office with a big wad of cash.

A better option is a cashier’s check. You may have to pay a small fee to get one, but it can be well worth the cost and extra effort to make your financial transaction faster and safer.

A cashier’s check is a paper check that’s drawn against your bank’s account rather than your personal account. Your bank stands behind the check and guarantees that the recipient, or payee, can deposit or cash it and receive the promised funds. Some banks call cashier’s checks “official checks.”

Recipients may prefer cashier’s checks because:

The name “cashier’s check” refers to the bank’s teller, who may also be called a cashier.

Despite the name and the association with banks, it’s not only banks that issue cashier’s checks. Credit unions also offer them.

You can get a cashier’s check from a bank or credit union you have an account with. You may have the option to request a cashier’s check from your online account, or you can visit a branch to get a check. The cashier’s check will be funded by the money in your account.

Expect to pay a fee of about $8 to $15 to get a cashier’s check from your bank or credit union.
These are the cashier’s check fees at major U.S. banks:

Follow these steps to get a cashier’s check:

Most banks issue cashier’s checks only to their own customers, so you’ll typically need an account to get this type of check from a bank. Credit unions often will issue cashier’s checks to members of other credit unions and their members.

Cashier’s checks, money orders and certified checks are all alternatives to personal checks and paper money. They have that in common, yet there are some differences, too.

Like a cashier’s check, the bank guarantees a certified check. The bank verifies that the check writer’s account contains the funds to back the certified check and keeps the funds in the account until the check is deposited or cashed.

“A certified check is a check that’s drafted against your account but certified by the bank as being payable, i.e., from a valid account with sufficient funds,” says Leibel Sternbach, a financial advisor and founder of Yields4U, an investment advisory firm in Plainview, New York.

The difference between a cashier’s check and certified check is that the funds to pay the cashier’s check come directly from the bank, rather than the check writer’s account.

“A money order is the equivalent to cash,” Sternbach says.

Money orders may be purchased with cash or a debit card. They’re available not just from banks and credit unions, but also from nonbank outlets, such as Western Union, the U.S. Postal Service and some retailers. They’re usually limited to $1,000.

Unlike with a cashier’s check or certified check, which is printed with the recipient’s name when issued, you fill in the name of the person or entity receiving the money order.

You may want to use a cashier’s check, or you may have to, for transactions that involve a large sum of money or transactions that call for an added layer of trust, such as:

It’s difficult to order a stop payment on a cashier’s check. However, you can contact your bank to request a cashier’s check cancellation, and it may be allowed if you are dealing with loss, theft or fraud.

You’ll likely need to file a declaration of loss with the bank, which states that you lost possession of the cashier’s check. You may also be required to purchase an indemnity bond, which protects the bank if a lost cashier’s check is presented for payment. After that, you’ll get your funds back within about 90 days.

The expiration date on a cashier’s check depends on the bank. Some cashier’s checks have a “void after X days” disclaimer, usually between 60 to 180 days. Other cashier’s checks have no expiration date and should remain valid as long as the bank operates.

Cashier’s checks are popular with scammers, so you should be wary if you receive one. Typically, these scams ask you to deposit a cashier’s check and send payment as a refund or to a third party, but you won’t get any money from the fraudulent cashier’s check and will lose the money you send.

Some typical cashier’s check scams include:

Ron Strobel, a financial planner and founder of Retire Sensibly, an investment advisor in Idaho, explains how scammers can pressure you to cash a fraudulent cashier’s check and send funds:
“The scammer might create urgency by saying they accidentally sent too much money and they need it back urgently for something important like paying their rent,” Strobel says.