Difference Between Cashier's Check & Money Order

Cashier's check offer a secure payment.
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Both cashier's checks and money orders offer a secure way to make payments. In each case, the funds for the transaction have already been provided, meaning there is no danger of a transaction being declined for insufficient funds. Both also can be replaced it lost, though the timelines and fees depend on the policies of the institution where the transaction took place.

Cashier's Checks

You have to go to a financial institution to get a cashier's check, and you usually have to be an existing customer. A cashier's check requires the payer to provide the funds to the bank, which then places those funds among its own assets and issues a draft for the provided amount minus its fee. As a result, the funds in the check are drawn from the bank's assets rather than the depositor's. Cashier's checks usually are cleared the next business day, though if the amount is more than $5,000 it might take longer. In addition, cashier's checks can be forged, so be wary if a stranger pays for something with a cashier's check in excess of the amount owed and then asks you to wire back the extra funds – it's a classic scam.

Money Orders

A money order can be bought at many banks and money transfer agents, as well as the United States Postal Service and some retail outlets, for a nominal fee. You provide the agent with the funds, usually via cash or debit card, and receive the balance on a money order. Because you don't need to be a customer to buy one, it's ideal for those who don't have a bank account. However, you usually can't buy a money order for more than $1,000, so you'd need to buy multiple money orders if your transaction amount exceeds that threshold. Cash or deposit it as you would a personal check.

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