Who Signs the Back of a Cashier’s Check?
Learn who signs a cashier's check and how to properly endorse it for secure and valid transactions.
A cashier’s check represents a secure form of payment, issued directly by a bank or credit union. Unlike a personal check, which draws funds from an individual’s account, a cashier’s check is drawn from the financial institution’s own funds, guaranteeing the payment. This guarantee makes cashier’s checks a preferred method for significant financial transactions, such as real estate deposits, vehicle purchases, or other large-value payments requiring assurance of funds. The bank verifies and earmarks funds before issuing the check, eliminating the risk of it bouncing.
The Primary Endorser: The Payee
The payee, named on the “Pay to the Order of” line, is authorized to sign the back of a cashier’s check. This act of signing is known as endorsing the check, and it signifies the payee’s authorization for the funds to be transferred or deposited. The endorsement confirms that the person presenting the check is the intended recipient.
When an individual is the sole payee, they simply sign their name on the back of the check. For checks made out to multiple payees, the wording between the names dictates who must sign. If “AND” connects the names (e.g., “John AND Jane Doe”), both individuals must endorse the check. Conversely, if “OR” is used (e.g., “John OR Jane Doe”), either party can endorse the check independently. In cases where a business is the payee, an authorized representative of that business must sign on its behalf, often by first writing the business name, then their signature, and their title, such as “Owner” or “Accountant.”
Endorsement Types and Fund Transfer
Beyond simply signing, payees can utilize different endorsement types to specify how the funds from a cashier’s check should be handled. A blank endorsement involves only the payee’s signature on the back of the check. While simple, this makes the check payable to anyone holding it, creating a security risk if lost or stolen. Therefore, it is advisable to apply a blank endorsement only immediately before depositing or cashing the check.
A special endorsement allows the payee to transfer the check to another person or entity. This is achieved by writing “Pay to the Order of [New Payee’s Name]” above the original payee’s signature. For example, if gifting funds or paying a third party, this endorsement directs the funds to the new named payee. Banks are not legally obligated to accept these third-party endorsements, so confirming with the bank beforehand is advisable.
For increased security, a restrictive endorsement limits how the check can be used. This is commonly done by writing “For Deposit Only” followed by the payee’s signature and, optionally, their account number. This ensures the check can only be deposited into the specified account and cannot be cashed, reducing the risk of fraud if lost. Some banks may also require specific phrasing, such as “For Mobile Deposit Only,” when using mobile deposit services.
Cashing or Depositing an Endorsed Check
After proper endorsement, the process of cashing or depositing a cashier’s check involves presenting it to a financial institution. The bank requires valid, government-issued photo identification, such as a driver’s license or passport, to verify identity. In some instances, particularly for larger amounts or if cashing at a non-issuing bank, the bank may request that the endorsement be made in the presence of a teller.
Cashier’s checks can be deposited into an account at any bank, or cashed at the issuing bank or, sometimes, at the payee’s bank, though the latter may involve fees or require an account. Banks verify authenticity, which may involve contacting the issuing bank. While cashier’s checks are guaranteed, banks may place holds on funds, especially for large amounts, to ensure legitimacy. Typically, funds from a cashier’s check are available by the next business day after deposit, but for amounts exceeding $5,525 to $7,000, a hold might extend availability to several business days. Avoid signing the check until physically at the bank or credit union and ready to complete the transaction.