How to Write a Check and How to Endorse a Check
Learn the correct methods for creating and validating checks, ensuring your financial transactions are handled properly.
Checks remain an important financial tool for many individuals and businesses across the United States. While digital payment methods have become widespread, paper checks continue to be used for various transactions, including paying bills, receiving refunds, or making payments to individuals or organizations. Understanding proper check procedures ensures secure and accurate transactions. Familiarity with writing and endorsing checks is a practical skill for managing personal finances.
Writing a Check
Begin by dating the check in the upper right-hand corner, indicating the month, day, and year. This date records when the check was written, helps track payments, and prevents issues with stale-dated checks, which banks may not honor.
Next, identify the payee by writing their name or the organization’s name on the line labeled “Pay to the Order of.” Write the full and correct legal name of the recipient to ensure funds are directed to the intended party and prevent fraud. Accuracy helps financial institutions process the payment smoothly.
The numerical amount of the payment is then entered into the small box located to the right of the payee line. This amount should be written clearly in digits, using a decimal point to separate dollars and cents. To prevent unauthorized alterations, start writing the numbers as far left as possible within the box and fill any remaining space.
Below the payee line, write out the payment amount in words. This written amount should precisely match the numerical amount. For instance, if paying $123.45, you would write “One hundred twenty-three and 45/100.” Filling the entire line with words helps prevent anyone from adding extra words or numbers.
To authorize the payment, the check must be signed on the signature line. Your signature on this line confirms your approval for the bank to release funds from your account. The signature should match the one your bank has on file to avoid processing delays.
A memo line is available in the bottom left corner of the check. This section is optional but useful for personal record-keeping. You can write a brief note here to describe the purpose of the payment, such as “July Rent” or “Invoice #123.” While it does not affect the check’s validity, the memo provides a helpful reference.
Endorsing a Check
When receiving a check, you must endorse it before it can be deposited or cashed. Endorsement occurs on the back of the check, usually within a designated area. This signature verifies that you are the intended recipient of the funds and authorizes the financial institution to process the check.
One common method is a blank endorsement, where you simply sign your name on the back of the check. While this is the easiest way to endorse, it also carries the highest risk. A check with a blank endorsement becomes a “bearer instrument,” meaning anyone who possesses it could potentially cash or deposit it, making it vulnerable if lost or stolen. Therefore, a blank endorsement is best used only when you are immediately depositing or cashing the check.
For enhanced security, a restrictive endorsement is recommended. This type of endorsement limits how the check can be used. The most common form is writing “For Deposit Only” followed by your signature. This ensures the funds can only be deposited into a specific account, reducing the risk if the check is lost. Many banks also require specific wording, such as “For Mobile Deposit Only,” when using mobile banking applications.
Another type is a special endorsement. This is used when you wish to transfer the check’s ownership to another person or entity. To do this, you would write “Pay to the order of [New Payee Name]” followed by your signature. This action legally transfers the right to the funds to the new payee, who then must endorse the check themselves to complete the transaction.
Proper endorsement is a requirement for financial institutions to accept a check for processing. It acts as a security measure, confirming the payee’s authorization and aiding in the correct distribution of funds. Without a complete endorsement, banks may refuse to process the check, protecting both the bank and the account holder.