Did you know that people still write millions of checks each year?
Bank checks may seem like an outdated form of payment, but the reality is, it wasn’t too long ago that checks were how people paid for just about everything. It’s important to know how to write one, and even more important to know the different types of bank checks and their purposes.
Read on to learn everything you need to know about the different bank check types.
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Blank checks are personal checks that have a blank amount field. The recipient of the check can write in his or her own amount and then cash the check normally.
You may see this kind of check in movies, but less in real life nowadays due to the high liability of blank checks. However, blank checks could come in handy if you give them to someone you trust to go grocery shopping.
Cashier’s checks are most commonly issued by banks. They are checks guaranteed and signed by a cashier or manager. You can also get a cashier’s check from locations that allow paycheck cashing.
Banks take the money out of your bank account, whereas these other locations will request the money in the form of cash.
Cashier’s checks are typically used to pay off home, college, or auto loans. They may. also be used for other bills.
Certified checks are used for big purchases where the risk is too high for a company to take a personal check. The process is similar to that of prepaid credit cards.
You may use a certified check to buy a used car. You’d have to present to your bank a check in the amount, and if you have enough money in your account to cover it, the bank will then issue your check. The amount is placed on hold in your account so the check doesn’t bounce.
This is a check that is payable to the person or company written on the check. They are unsecured, which means they do not guarantee the money will be available when they are cashed out. They can accidentally or intentionally bounce.
Personal checks are the most commonly known type of check.
An electronic check is a digital version of a paper check. It is an electronic payment made from your checking account. The process involves a payments processor.
This type of check is commonly used to make online payments. There are even online check stub makers built by professional accountants.
Traveler’s checks are used by people who travel a lot to other countries. It is an insured, prepaid check to be used as a cash equivalent.
These can be issued in any currency. If the money is lost, it will be replaced because the check is insured. This makes them safer than a credit card if you are traveling.
Bank Check Guide
You can choose the types of bank checks that work best for you.
We hope you enjoyed this bank check guide. If you did, make sure to check out our other articles on money and banking!