Do Banks Hold Cashier’s Checks? What to Know

Cashier’s checks are a common and secure form of payment. Many people wonder if banks place holds on these checks, similar to personal checks. Understanding how banks handle cashier’s checks, including their availability and potential delays, is important for financial transactions. This clarifies the security and accessibility of funds.

Understanding Cashier’s Checks

A cashier’s check is a payment instrument issued and guaranteed by a bank, distinguishing it from a personal check. When purchased, funds are immediately withdrawn from the payer’s account and transferred to the bank’s own funds. This process ensures the check is backed by the bank’s assets, providing a high level of payment certainty to the recipient.

These checks are used for large transactions, such as real estate purchases or vehicle sales, where the recipient requires guaranteed funds. Obtaining a cashier’s check involves visiting a bank branch, providing the recipient’s name, the check amount, and paying any associated fees, which typically range from $5 to $15.

Funds Availability Rules

Federal regulations, specifically Regulation CC, govern how quickly banks must make deposited funds available to customers. For cashier’s checks, these rules mandate swift access. In most cases, funds from a cashier’s check deposited in person to an employee of the payee’s bank account must be made available by the next business day after the day of deposit.

Some financial institutions may make funds available on the same day, depending on their internal policies. If a cashier’s check is deposited at an ATM, funds may be available by the second business day. For any check deposit, including cashier’s checks, at least $275 of the deposit must be made available for withdrawal by the first business day following the deposit, effective July 1, 2025.

When Holds May Still Apply

While cashier’s checks generally offer expedited availability, certain circumstances permit banks to place a hold on the funds. These exceptions are outlined in federal regulations and aim to protect banks and consumers from potential fraud. One common exception applies to large deposits, where the amount exceeds $6,725 on any single banking day, effective July 1, 2025.

For new accounts, defined as those open for less than 30 days, banks may extend holds on check deposits. While cash and electronic payments typically have next-day availability in new accounts, the first $6,725 of a cashier’s check deposit may be available by the ninth business day, with the remainder subject to further holds. Banks may also place holds if an account has been repeatedly overdrawn, which generally means a negative balance on six or more banking days within the last six months, or two or more times with a negative balance of $6,725 or more.

Another reason for a hold is if the bank has reasonable cause to doubt the collectibility of the check, such as suspicion of fraud. This can occur if the bank receives information indicating the check may be uncollectible, or if the check appears post-dated or stale-dated. Additionally, checks that were previously returned unpaid and are then re-deposited may be subject to a hold. Banks are required to provide notice to the customer if a hold is placed, explaining the reason and when funds will become available.

Verifying a Cashier’s Check

Given the potential for fraudulent cashier’s checks, recipients should take steps to verify their legitimacy before acting on the funds. Contacting the issuing bank directly to confirm the check’s validity is important. Independently look up the bank’s official phone number, rather than using any number printed on the check itself, as fraudsters often provide fake contact information.

Recipients should also examine the physical check for security features that deter counterfeiting. Genuine cashier’s checks include watermarks, security threads, micro-printing, and color-shifting ink. Any signs of tampering, blurry text, or poor print quality could indicate a counterfeit. Depositing the check at your own bank, rather than attempting to cash it elsewhere, is also advisable.

Wait until the funds from the cashier’s check have fully cleared and are confirmed as available in your account before releasing goods, providing services, or wiring money. This is particularly relevant in common overpayment scams, where a fraudulent check is sent for more than the agreed amount, and the scammer requests the excess funds be wired back. Financial institutions will reverse deposits of counterfeit checks, even after initial availability, leaving the recipient responsible for any funds spent.