42% of millennials still use checks to pay for items. Even though half of the generation still uses checks, many of them still don’t understand the differences between a cashier’s check and a certified check.
While there isn’t a huge difference, there are certain elements that make each standout. Keep reading to learn more about cashier’s checks vs. certified check.
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What Is a Cashier’s Check?
Many people use a cashier’s check to purchase goods or services. Banks issue them and guarantee the funds with the money in the account from which it was drawn.
Cashier’s checks are typically used for large transactions. For example, people get them when purchasing a car or real estate. They are also used for international transactions.
The benefits of using a cashier’s checks include:
- The amount on the cashier’s check will be available immediately
- The funds are typically free from any risk of bouncing back
- It can help protect against fraud
Cashier’s Check Guide
There are many common questions asked about cashier’s checks. Below, we’ll answer a few:
When Do You Use One?
It’s common to use a cashier’s check for large purchases such as real estate or cars. They are also used when you want to make sure that the recipient has access to their money quickly. Sometimes when completing a transaction, one of the parties may request a cashier’s check for any payment made.
How Do You Get One?
Cashier’s checks are similar to personal checks, but they are typically drawn on the account of the institution that issues them. The bank or credit union will verify the identity and account balance of the person requesting the cashier’s check before issuing it.
To get a cashier’s check, you need to either go to your bank or find an online site that offers this service. You will need to provide some personal information and fill out the necessary forms for verification.
How Much Does It Cost?
You get a cashier’s check from a financial institution such as a bank, credit union, or brokerage firm. The cost of the cashier’s check will depend on the issuing institution. The cost usually ranges from $10 to $40.
What Is a Certified Check?
A certified check is a check with the bank’s certification on it that guarantees that the account holder has enough money to cover the amount of the check. It typically comes with an extra fee. A certified check allows you to be sure that your funds are available when you need them and helps avoid bounced checks.
You can use a certified check in place of cash, as long as you have enough money in your account to cover it. Are you curious about verifying certified checks? Learn more about check verification so you know what type of payment you received.
Certified Check Guide
Wondering when you should use a certified check? Read the following guide:
When Do You Use One?
When you need to make sure that the funds are available for withdrawal, or when you want to provide a form of security for your recipient.
Certified checks are often used in commercial transactions, such as real estate transactions. This is because they offer an added layer of security for both parties involved in the transaction.
How Do You Get One?
If you need to get a certified check, the process is fairly straightforward. You will need to bring your identification and the necessary information to your bank. Once there, they will verify your identity.
They will then issue an official check that draws directly from your bank account. They will then stamp it with their seal and sign it, certifying that it is valid and has not been tampered with.
How Much Does It Cost?
The cost of a certified check varies widely. Some banks issue them free for customers. Other banks charge a fee ranging between $2 and $15.
Cashier’s Check vs. Certified Check: Which Is Better and Safer?
A cashier’s check is drawn against the bank’s account while a certified check is drawn against an individual’s account. Cashier’s checks also have watermarks that are difficult to replicate in cases of fraud.
In general, both types of these checks are highly secure forms of payment. If you receive one of these forms of payment, you can easily look up the financial institution and call them to verify the check is real. You must be cautious when dealing with any payment options because scammers are targeting people all over the internet.
What Happens If You Lose One of Them?
It’s very important you do everything possible to not lose one of these checks. If it happens, you must contact the issuing institution immediately to file a report and learn about the replacement process.
Many financial institutions require someone buy an indemnity bond if they lose a cashier’s or certified check. This is to ensure that if the lost check is cashed, the bond covers the amount. You can’t stop payment on these types of checks.
Some banks require a waiting period before they will issue a replacement check. It’s vital you do not lose this form of payment to avoid a complex and lengthy process to resolve the issue.
Learn More On Our Blog
Now you understand the difference between a cashier’s check vs. a certified check. We hope this article helped you learn when to use each type of payment option. While they are similar, each option has its pros and cons.
If you enjoyed this article, we invite you to check out our blog. You’ll find interesting topics about businesses, finances, investments, and taxes.
