Cashier's Check
A check written by a financial institution on its own funds. It is then signed by a representative of the financial institution and made payable to a third party. A customers who purchases a cashier's check pays for the full face value of the check and usually also pays a small premium for the service. These checks are secured by the funds of the issuer - usually a bank - and include the name of a payee (the entity to which the check is payable), and the name of the remitter (the entity that paid for the check). Investopedia Says:
An individual could use a cashier's check instead of a personal check to guarantee that his or her funds for payment are available. A cashier's check is secured because the amount of the check must first be deposited by the individual into the issuing institution's own account. The person or entity to whom the check is made out is then guaranteed to receive the money when cashing the check.
Cashier's checks differ from certified checks in that the funds owing on a cashier's check are taken from the issuer's account, while the funds owing on a certified check are taken from the remitter's account. Related Terms:
Bankable Funds
Bounced Check
Certificate Of Deposite - CD
Certified Check
Check
Crossed Check
Letter Of Credit
Rubber Check
Traveler's Check |