What is a certified check and when should I use one?

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In a Nutshell

A certified check can give you more certainty when making big purchases. For a fee, your bank verifies that you have enough money to cover the check — giving the person you’re paying assurance that they’ll receive their money.
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If you’re looking to make a big purchase and don’t want to carry a lot of cash, or you need more assurance that a transaction will be successful, a certified check might be just what you’re looking for.

When you have a financial institution certify your personal check, the bank verifies that you have enough money to cover your check — and even sets aside that amount until the check clears.

Let’s look at how certified checks work and what you should know if you’re thinking of using one.

What is a certified check?

When you write a personal check drawn on your own account, your financial institution can certify it.

By certifying your check, the bank or credit union attests that you have sufficient funds in the account to cover the check and that your signature is valid. A bank representative will stamp “certified” or “accepted” on the face of the check and sign it.

You can typically request a certified check from your bank for a small fee.

Unlike a cashier’s check or money order, the money to pay the recipient of a certified check comes from your account, not the bank’s account. The bank will earmark funds in your account to cover the check, which means it will only release those funds to complete the payment when the recipient cashes your certified check. While not 100% foolproof, a certified check can give a recipient more confidence that the check will be good.

How is a certified check different from a cashier’s check?

Though similar, a certified check and cashier’s check have a few key differences.

When requesting a cashier’s check, you pay your bank the amount of the check in advance, plus a fee. The bank then draws from its own funds to issue the check directly to the recipient. You don’t need to have a bank account to get a cashier’s check — you just need the money to pay for one. And you can get a cashier’s check from some national retailers, not just at banks.

With a certified check, the money is drawn from the customer’s account to pay the recipient. You just pay a fee to have your bank, credit union or other financial institution verify your account.

How do certified checks work?

Certified checks begin with you writing out a personal check drawn on your checking account. Your bank may require you to write the check in front of a teller before it’ll certify it. At your bank, a teller will look at your account to make sure you have enough money to cover the check. Then they will physically stamp it, marking it as a certified check.

The bank will also earmark money in your checking account to pay for it — and generally won’t let you use it for anything else. That way, when you make a transaction using the certified check, the recipient has some assurance the money will be there.

Why might I use or receive a certified check?

A certified check can be a good way to buy a more expensive item. As a buyer, you don’t have to carry around a large amount of cash. If you’re selling something, a certified check can give you some confidence that the check won’t bounce.

And some government agencies, like court systems, won’t accept personal checks unless they’re certified.

How do I get a certified check?

If your bank offers certified checks, go to a branch and let the teller know you’d like to get a certified check. The bank will generally ask that you write out a personal check there in front of the teller and show your ID. The teller will then look at your account, verify that you have enough money and earmark the funds.

Once you pay your fee, you can take your new certified check with you to give it to the payee.

How much does it cost to use a certified check?

Fees for getting a certified check vary widely among financial institutions, so it’s best to check with yours first to find out what it’ll charge. Certified check fees can range from as little as $1 to $3 and as much as $15 to $20.

By comparison, the fee for a cashier’s check  is often around $10.

Are there drawbacks to using a certified check?

While certified checks can be a convenient way to make a large purchase, they have their downsides as well. Here are a few.

  • Your money doesn’t transfer as quickly. A certified check functions much like a traditional personal check, meaning it will take a few days for the check to clear. Cashier’s checks, paid by the bank, clear much quicker. If you need the money to move fast, you might look at another option.
  • You may not be able to stop payment. You can ask your bank to stop the payment on a personal check if you write in the wrong number or need to cancel it for other reasons. But once a check has been certified, you may not be able to stop payment on it. Or it may be difficult to cancel the payment unless you meet specific requirements (say, the check was lost or stolen).
  • You’ll pay a fee. Financial institutions typically charge a fee to certify a check.
  • It’s hard to replace a certified check. If you lose your certified check, there’s a long process you have to go through to get a new one. You’ll likely need to fill out an affidavit asserting that the check is lost and fill out forms to stop payment on it.
  • You have to go to a branch. You typically have to go to a bank branch to get a certified check, which can be a pain if you don’t live close by.
  • Certified checks can be faked. While certified checks can feel more secure, they can still be forged or counterfeited. Watch out for scams — if you’re on the receiving end of a certified check, you should still be wary.

Next steps: Reduce risks of certified check fraud

Certified checks can give you more certainty  that the check is good. But fraudsters can still make counterfeit certified checks and pass them off as real.

Fake check scammers often send you a certified check or cashier’s check and then ask you to wire someone money or send them gift cards or other items in return. Later, you find out the check they gave you was fake — and your money is gone.

If you get a certified check that you’re concerned is fake, call the bank whose certification is on the check and see if it can verify it. Don’t assume that your certified check is valid after you deposit it until it clears.

If you believe you’ve been given a fraudulent check, you should contact …

About the author: Andrew Dunn is a veteran journalist with more than a decade of experience as a reporter and editor at North Carolina news organizations, including the Charlotte Observer and the StarNews in Wilmington. In those roles,… Read more.