11/22/2022
While payment methods continue to evolve with technological trends, there are traditional forms that refuse to die. Such is the case of cashier's checks, which have a specific utility for people who want to secure a transaction.
Due to their latent validity, we wanted to find out more about their characteristics and their differences with standard checks or certified checks.
What is a cashier's check
A cashier's check is a document signed by a cashier that is endorsed by a bank or credit union to make a payment. This means that the entity sets aside the money from its own funds and then takes it from your account.
By this method, you have the assurance that the check in question will be funded when it is cashed or deposited.
Checks are considered a fast and secure way to make a transaction involving large sums of money. For this reason, they are used for down payments on mortgages or automobiles and when you are doing business with a person you do not know.
The procedure for this security consists of printing a commercial document with the name of the person who will receive the funds and the designated amount.
Once the recipient has the check in his hands, the banking institution is responsible for paying the money. Usually, the amount is cashed the next business day.
How to get a cashier's check
It is important to know that only banks and credit unions are the institutions that offer these financial products.
The most common way to obtain a cashier's check is to visit a branch near you to request one. It is a very simple process that takes a few minutes and you get the money you need to make the transaction.
You also have the option of requesting this resource via the Internet, especially when it comes to online banks. It is a slower process, since the entity sends you the check by mail to your verified address and not to the beneficiary. Therefore, you have to wait for it to arrive and then send it to the right person.
It is important that you have money in your account or carry cash with you that corresponds to the request.
Please note that if you are not a customer of the bank or credit union, you may not have access to this instrument. This may mean: opening an account, using an affiliated entity or finding an agency that will give it to you without being a customer.
Cashier's check requirements
At the moment of requesting a cashier's check, you will be asked for a series of documents and information, such as:
- Valid identification. When you visit a banking agency, be sure to bring a license, passport or other government-issued document that identifies you.
- Name of the beneficiary. You must provide the name of the person or company to whom the security is addressed.
- Amount. You must also indicate the exact amount you require for the operation. This is because once the cashier's check is printed, it cannot be changed.
- Commission. Like most banking services, you must pay a fee for the issuance of the cashier's check. Generally, banks and credit unions will charge you between $8 and $10 for this process.
- Additional details. If you want to add additional information, you can add a note, a reference number or your account number.
Advantages and disadvantages of cashier's checks
Although the cashier's check is classified as secure, it is a form of payment that can be exposed to fraud. In addition to inviting you to compare other methods, here are the pros and cons of this alternative:
- Guaranteed. The main reason why cashier's checks are still in force is because the bank pays with its funds, avoiding any uncomfortable or irregular situation.
- Fast. Funds under $5,000 are available the next business day. If the amount is higher, you must wait for validation of legitimacy.
- Secure. Provided it is legitimate, this instrument endorsed directly to the recipient eliminates the risk of theft or fraudulent action.
- Fraud. The sense of security provided by this resource also makes it subject to various frauds or scams. That is why you should not accept a cashier's check with an amount greater than expected or that is more than 90 days old.
- Fees. You may be charged a small fee for this service. This depends on the type of account, as premium checking accounts offer free issues.
Español: ¿Qué son los cheques de caja?