What Is a Bank Check and When Do You Need One?

What Is a Bank Check and When Do You Need One?
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A bank check, also called a cashier's check, is a form of payment issued, backed and signed by a bank or credit union. A bank customer provides the funds to the bank to cover the amount, and the bank generates the check and makes it payable to the payee requested by the bank customer. Bank checks are most often used when a personal check is not accepted and a more secure, guaranteed payment is required.

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What Are Other Terms Used to Describe Bank Checks?

Bank checks and cashier's checks are the same thing. You might hear other terms for bank checks that are essentially the same thing, such as:

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  • cashier's check
  • teller's check
  • official check
  • bank draft
  • treasurer's check

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By any of these names, the type of check referred to is written, signed and guaranteed by a bank or credit union. The account holder provides payment directly to the financial institution, and the bank draws that amount from its own funds.

Certified checks are different because they are issued by a bank but signed by the bank account holder. A money order is separate from all of these because it is not backed by a bank and can be issued by parties other than a financial institution.

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Only financial institutions may issue a bank check. A check-cashing place or grocery store can issue money orders, but cannot generate bank checks. Bank checks can be cashed at locations of other financial institutions, such as Walmart Money Center.

With a bank check, you provide funds to your bank to generate the payment, but the actual check you hand to the recipient is drawn on the bank's funds.

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Bank or Cashier's Checks vs. Regular Checks: What's the Difference?

The main difference between a personal check and a bank check is where the funds are drawn. A personal check is one you write and sign personally from your own checking account and present directly to the payee. The funds are withdrawn from your account, so the payee has to hope you have sufficient funds.

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With a bank check, you provide funds to your bank to generate the payment, but the actual check you hand to the recipient is drawn on the bank's funds. The bank signs the bank check or cashier's check, so the financial institution guarantees those funds.

Why Might I Need a Bank Check?

Sometimes, the recipient of a check payment will not accept a personal check and will require a payment backed and guaranteed by a bank. Common situations usually involve large sums of money for substantial purchases such as the down payment for a car or a home, annual insurance premiums or the final payment on a loan.

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With large sums of money, a seller or lender may want the security of knowing you have already presented the payment to a bank and the bank is guaranteeing the check you have paid with.

How Do I Get a Bank Check?

If you have a checking account at a bank or credit union, getting a bank check is relatively simple – as long as you have sufficient funds to cover the amount of the check. You cannot purchase a bank check with a credit card. You must present cash or have the funds available in your bank account for immediate transfer to the bank.

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  • Go to your local bank.​ In most cases, you will work in person with a teller to complete the transaction. However, Some financial institutions have options for customers to order bank checks through a mobile app. Navy Federal Credit Union customers can use their digital banking app to transfer the funds for a cashier's check, then pick up the check at their local branch or have it delivered to their home.
  • Bring a photo ID and check details:​ The bank will want to know the payee's name and the amount the check should be written for. The bank can't issue a blank bank draft, and they'll want to verify your identity.
  • Be prepared to pay a fee​. Many banks and credit unions will only provide this service to customers with a banking account. They also charge a fee for processing a bank check that often ranges ​between $5 and $20​, depending on the bank and your account. Bank of America charges $15, while Wells Fargo charges $10. Call or check the website's FAQs page for your bank's policy and fees.

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How Does the Bank Process a Bank Check?

When you request a bank check or cashier's check, the bank transfers the amount from your checking account into the bank's reserve account. The bank check will be drawn from that fund. When the payee deposits or cashes the check, their financial institution's policy for verifying and clearing bank checks will determine how long before the funds are available. Often this is just one business day, according to the Office of the Comptroller of the Currency.

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Is a Bank Check Safer?

A bank check or cashier's check is generally considered safer than a personal check because a financial institution guarantees it. A seller does not have to worry about insufficient funds and bounced checks as long as the bank check is legitimate and not fraudulent.

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Bank checks are much safer than carrying around large amounts of cash. In most high-ticket item situations where a bank check is required, cash may not be an acceptable form of payment, anyway.

Pros and Cons of Paying by Bank Check

Pros

Secure

Trusted

Backed by the bank

Funds available quickly

Cashed at a variety of locations

Cons

Fee

Need a bank account

Cannot be purchased with a credit card

Often must be purchased at the bank

Difficult to cancel or change

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