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A cashier’s check, or money order, offers a secure way to transfer funds. It works like a normal check, but offers an additional guarantee that the money will be cashed. If you have an operation that requires a large amount of money, it is safer to ask the bank for a cashier’s check instead of a personal one.
Order
Instead of writing a check from your personal stub, the party sending the money has to talk to their bank to get a cashier’s check. You need to have at least the amount of money you want to transfer in your bank account for the cashier’s check. The bank first reviews the account to confirm that there are sufficient funds, and sets aside the money for the cashier’s check, then the amount and the recipient’s name are printed on it.
Retirement
After the sender gets the cashier’s check, he hands it over to you. Then you can deposit it in your bank, which can be the same as the issuer, or any other. Your bank withdraws the money from the account and deposits it in yours.
Profits
A check can be bounced if the sender does not have enough money in their bank account to cover the amount of the check. After writing it, the sender can also cancel it if you have not withdrawn the money. A cashier’s check will not be bounced as the bank sets aside the money for it. As such, these are very useful for operations with large amounts where the recipient needs to ensure that they are going to obtain the funds.
Warning
Despite the extra security a cashier’s check offers you, it still carries risks because criminals can fake it and make it look real. A common scam is for the victim to receive it. The scammer asks the victim to keep a portion of the money, and to transfer the rest to another site. For example, the scammer may claim that the cashier’s check amount is a portion of the victim’s lottery winnings and ask you to pay their processing fee to get the rest of the winnings. When the victim realizes that the check is forged, the bank takes the credited amount from the victim’s account; and you lose the money that was sent to the scammers.