What Is a Certified Check?

Kelly Hernandez
A banker verifying a certified check application.
Reading Time: 4 minutes

If you’re involved in a transaction that requires a secure payment, it’s beneficial to learn more about obtaining a certified check. In many cases, certified checks are required if you’re making a large purchase or doing business with someone you don’t know personally.

Important investments, such as a car or house, may require the use of a certified check to cover the down payment or purchase price. By finding out how to obtain a certified check and why this specific payment method is secure, you’ll be prepared for these important transactions.

What Is a Certified Check?

A certified check is a secure payment because the funds are verified by the bank. The payer obtains the check from the bank and a bank representative verifies that there are sufficient funds in the account associated with the check. The bank representative also verifies that the payer’s signature is authentic and valid.

Since these important elements are verified by a bank official, the payee feels more confident that a certified check is fully funded. With a certified check, the other party involved in the transaction is guaranteed that as long as it’s a legitimate document, the check won’t bounce and will clear without an issue.

How to Get a Certified Check

If you’re involved in a transaction and the payee has asked for a certified check as payment, follow these steps:

  1. Obtain a personal check that’s linked to your bank account.
  2. Fill out the check correctly with the recipient’s name and amount.
  3. Bring the check to your bank and ask to meet with a bank representative.
  4. Provide your identification and account information.
  5. Allow the bank representative to verify that you’re the account owner and check your account balance.
  6. Sign the check in front of the bank employee.
  7. Provide the check to the bank employee so they can add a certified stamp and their own signature.

The bank representative may also include stipulations for your certified check, such as a 60-day expiration date. Ask about any stipulations so you’re sure the payee can cash the check without complications.

Once you have a certified check, the bank places a hold on the funds in your account. This ensures the check remains valid and the funds are available for the payee. While obtaining a certified check is a similar process to requesting a bank draft, you’re responsible for providing the check to be certified.

How a Certified Check Works and When to Use One

When you request a certified check from your bank, a representative must assist you and the funds in your account must be put on hold. Since your bank has to do extra work to provide you with a certified check, there’s usually a fee associated with your request, which varies depending on your bank.

There are several situations that may require you to visit your bank and obtain a certified check. You may need to use a certified check to:

  • Pay your bills;
  • Provide payment to a private seller;
  • Purchase items at an auction;
  • Provide a down payment for a large purchase, such as a car or home.

Generally, when a large purchase price is involved or you’re buying an item from someone you don’t know, the other party may request secured payment in the form of a certified check.

Certified Check vs. Cashier’s Check

Certified checks and cashier’s checks are similar because they both require bank approval, making them secure payments. However, with a cashier’s check, you provide cash or money from your account directly to fund the check amount.

With a certified check, you provide the representative with your own personal check and they’re responsible for verifying the funds are available before certifying the check. When a certified check is cashed, the money comes directly from your account. When a cashier’s check is cashed, the money comes directly from the bank.

Certified Check vs. Personal Check

Both a personal check and certified check are linked to your bank account. When a payee cashes either a personal or certified check, the money is taken directly from your account. However, a personal check is less secure because it’s not guaranteed by the bank. You can write a personal check and hand it to the recipient without having a bank representative ensure the funds are available first.

A certified check is considered a secure method of payment because it’s the bank representative’s job to verify you have the funds in your account to cash the check successfully. You can spot the difference between a personal and certified check because a certified check is donned with an official bank stamp while a personal check is not.

Certified Check vs. Money Order

A certified check, as well as a cashier’s check and money order, are all considered secure forms of payment. These payment methods have already been funded or verified, so the recipient feels confident that the funds are available. While they’re both secure forms of payment, a certified check is a bit different than a money order.

To obtain a money order, the payer must offer cash up front to a financial institution or money order vendor. The vendor or institution provides the money order and the payer gives it to the recipient, who can cash it or deposit it directly into their bank account.

A certified check doesn’t require the payer to provide cash up front. Instead, the bank verifies that the payer has the proper funds in their account and certifies the payment method. When the recipient cashes the certified check, funds come directly from the payer’s account and not from the institution.

Protect Yourself From Fraudulent Checks

Since certified checks are considered secure forms of payment, it’s common for scammers to create fraudulent checks to prey on victims. Protect yourself from being involved in a fake check scam by:

  • Verifying funds: Call the issuing bank on the certified check to verify its validity.
  • Asking for a wire transfer instead: A wire transfer requires funds to be wired from one account to another, making it harder for you to be scammed.
  • Cashing the check: Instead of depositing the check and waiting for funds to clear in your account, cash the check instead.

A certified check requires verification from the bank that the payer has the funds in their account. This makes it a secure form of payment, as long as the check is legitimate and valid.

Image Source: https://depositphotos.com/

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