Cashier’s Check vs. Money Order: How to Decide - NerdWallet (2024)

FAQs

Cashier’s Check vs. Money Order: How to Decide - NerdWallet? ›

Many businesses won't issue a money order for more than $1,000, but there's typically no limit on the amount a cashier's check can cover. On the other hand, if you need to make a $500 deposit for an apartment and can't use a personal check, a money order would be wiser because they're generally less expensive. 4.50%

A money order can be easier to buy. They are often sold in places that you'd visit during the normal course of your week: grocery stores, post offices, and some big box retail stores. You could pick one up when you're buying groceries or running errands.

Unused cashier's checks can be returned to the bank for a refund, but you may need to follow specific procedures or escalate the issue to management if the bank is uncooperative.

Filling out money orders is similar to filling out a check. Before you fill out a money order, make sure you have all the information you need, such as the payee's name and address, the payment amount, and any relevant account numbers or order numbers.

Unlike checks, however, a money order is not directly pulled from your account, and they are useful in instances where you may not want to use personal check which has personal information such as address, T/R number and account number.

Cashier's checks are harder to replace than money orders if lost or stolen. The bank that issued the check might require you to buy an indemnity bond from an insurance company for the amount of the check. The indemnity bond makes you, not the bank, responsible for any losses if the check is cashed.

Bank drafts and certified cheques are considered to be more secure because the funds are guaranteed by a bank. Money orders are guaranteed by the person paying, but funds are required upfront instead of being held in a bank account.

Recipients may prefer cashier's checks because: They're almost equivalent to cash, but the risk of theft is lower because only the payee can deposit a cashier's check. They're guaranteed. Unless a cashier's check is fraudulent, there's almost no risk that it will be declined, or "bounce."

As a rule, the only time a bank may refuse to pay its cashier's check is when the bank has its own defense against paying the item and the person attempting to enforce payment is not a holder in due course.

Common cashier's check scams

In some cases, you're laundering money for criminals. In other cases, the first few payments are fine, but eventually you'll get a fake check (after they've gained your trust) and you'll lose money.

Why do people still use money orders? ›

Money orders are readily accepted and converted to cash and are often used by people without access to a standard checking account. They are an acceptable form of payment for debts, both personal and business. You can buy a money order for a small service fee from most banking institutions and many other locations.

First, you need to know the exact amount for the check. Double check the amount and write it down if necessary because this amount cannot be changed once the cashier's check has been printed. You also need to have the recipient's name, whether it is a person, a store, or another kind of business.

A money order is a secure way to send money or make a payment — up to $1,000. Many recipients prefer money orders because, unlike a personal check, a money order can't “bounce” and clears almost immediately; therefore, they provide a fast, risk-free form of payment.

Cashier's checks and certified checks are typically considered as good as cash and often clear faster than personal checks. In many cases, these checks are available for use by the payee within one business day after deposit.

Cashier's checks are a great option for large-dollar transactions or for when you conduct business with people or companies you don't know well, such as when you buy or sell a car. Occasionally cashier's checks are required in real estate or broker transactions because of the large dollar amounts involved.

You can purchase cashier's checks at bank or credit union branch offices. Some financial institutions also make them available on their websites or by telephone. A bank might issue cashier's checks to non-customers, but most probably will only issue them to customers.

If you're making a one-time purchase, and want physical proof of the exact amount, money orders are a secure option. Plus, money orders do not contain your personal information, such as your account number. Some bank accounts come with free money orders, such as our MaxMoney® checking account.

You can get a money order at Walmart (up to about $250) but not a cashier's check. Those you can only at some form of financial institution. Yes, you can typically get a cashiers check at Walmart. However, availability may vary depending on the specific store location.

Both cashier's checks and certified checks are official checks that are guaranteed by a bank. Compared with personal checks, cashier's checks and certified checks are generally viewed as more secure and less susceptible to fraud.