How Much Can a Cashier’s Check Be Made Out For?

A cashier’s check is a secure payment method issued directly by a financial institution. It is used for substantial transactions where the recipient requires guaranteed funds. The bank’s backing provides assurance of payment, distinguishing it from other payment forms.

Understanding Cashier’s Checks

A cashier’s check is guaranteed by a bank and drawn from the bank’s own funds, not a customer’s personal account. This eliminates the risk of insufficient funds, as the money is set aside or withdrawn from the customer’s account before issuance. Cashier’s checks are commonly used for large transactions like real estate purchases or vehicle acquisitions, offering assurance that funds are available and will clear.

Amount Considerations for Cashier’s Checks

There is no federal law imposing a specific maximum limit on the amount for a cashier’s check. Financial institutions, however, often implement their own internal policies and practical limits based on their risk management practices. Some banks might set internal daily limits, such as a total of $500,000 per customer per day, or $250,000 for online requests.

A key consideration for larger amounts involves federal reporting requirements under the Bank Secrecy Act (BSA). Financial institutions are mandated to file a Currency Transaction Report (CTR) with the Financial Crimes Enforcement Network (FinCEN) for any cash transaction exceeding $10,000. While a cashier’s check is not cash, the initial payment to the bank to obtain the check, if made in currency over this threshold, triggers a CTR. Banks typically charge a fee for issuing cashier’s checks, often ranging from $10 to $15.

Obtaining a Cashier’s Check

Acquiring a cashier’s check involves a visit to a bank or credit union branch. Customers need to provide specific information, including the exact amount, the full legal name of the payee, and sometimes a memo line detail specifying the purpose of the payment.

The customer must have sufficient funds in their account to cover the full amount of the check, plus any applicable fees. Banks will withdraw or hold these funds immediately. Government-issued photo identification, such as a driver’s license, is required to verify identity. The check is usually issued immediately after the necessary information and funds are provided.

Verifying Cashier’s Checks

When receiving a cashier’s check, especially for a significant sum, it is important to verify its legitimacy to protect against fraud. The most reliable method is to directly contact the issuing bank to confirm the check’s validity. It is crucial to locate the bank’s official phone number independently through a trusted directory or their official website, rather than using any number printed on the check itself, as this could be part of a scam.

When speaking with the bank, provide them with the check number, the exact amount, the date of issuance, and the name of the purchaser to verify the check’s authenticity and confirm that funds are legitimately available. Additionally, examining the physical features of the check can reveal red flags. Legitimate cashier’s checks often include security features like watermarks visible when held to light, security threads, or microprinting. Be wary of checks with misspellings, poor printing quality, unusual fonts, or requests for overpayment with instructions to wire back the difference, as these are common indicators of fraudulent activity. Always wait for the funds to fully clear before releasing goods or services, as funds may be made available by the bank before the check is confirmed to be legitimate.