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Cashing a check

Cashing a check

Cashing a check

When most people receive a check, they deposit it in their bank account, cash it at their bank, or show their ID and cash it at the bank that issued the check. It’s possible to cash a check without a bank account by cashing it at the issuing bank or a check cashing store. It’s also possible to cash a check if you’ve lost your ID by using an ATM or signing it over to someone else. Learn more below. All of these options will have fees and may be time-consuming. The fees might be small, but they add up. If you’re earning $300 a week and paying $7 to cash your paycheck, that’s 2% of your paycheck used just to convert your paycheck to cash. That’s $360 in fees per year!

Cash

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As a last resort, you can sign the check over to someone you trust and ask them to cash it for you. This creates a third-party check. However, if you choose this option, keep in mind that many banks will require verification that original payee authorized the signing over of the check, by having the original payee present and presenting their ID. Read about how to endorse a check to have a friend cash it for you. You might not be able to cash a check for the entire payment amount, especially when payments exceed $200. The advantage of going to the check writer's bank is there’s a better chance of getting 100% of the check amount immediately. That’s because that bank has real-time access to the checking account in question, so it can verify that funds are available in the check-writer’s account. If the check exceeds $200, you often have to wait to use the funds until the second business day.

When cashing a check, your bank might only allow you to take the first $200 in cash, and you'll have to wait a few days before the rest of the money becomes available. It’s certainly possible that your bank will let you take more cash immediately (or spend the money using your debit card). But until the check actually clears, there’s a risk that the check will bounce, and you’ll have to replace that money.You can probably do better (or avoid fees altogether) by opening an account at a bank or credit union. If you receive more than a few checks each year, open a bank account. In addition to saving money on fees, you’ll most likely save a lot of time if you have a bank account. For example, you can use a bank or credit union’s mobile deposit feature to deposit checks with your mobile device instead of making a trip to a check-cashing store. (Source: www.thebalance.com)

 

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