A cashier’s check and a money order are both forms of payment that can be used instead of cash or personal checks, but that’s where the comparisons stop. Cashier’s checks are issued by a bank, are available in higher dollar amounts, are considered more secure than money orders, and have higher fees than money orders. Money orders can usually be purchased at a check cashing store, post office, grocery store, and many other places, are typically limited to less than $1,000, and have lower fees than cashier’s checks.
Read on for more information about the difference between cashier’s checks and money orders.
Why use a cashier's check?
There are several advantages to using a cashier’s check. This kind of check is great for larger dollar amounts and may prevent you from needing to buy multiple money orders. It is considered more secure than a money order and some payees may specifically request them.
The money is backed by the bank and considered “guaranteed funds.” Landlords may request that a security deposit be made by cashier’s check. In addition to being reliable funds, this is a way to prove that the potential tenant has a banking relationship.
Cashier's checks are good for large purchases.
Cashier’s checks are typically used for larger purchases. Although the policy may change from bank to bank, generally there’s no upper limit for a cashier’s check. The payee typically has quicker access to a larger amount of the funds with a cashier’s check.
Cashier's checks are safer to use.
Cashier’s checks are generally considered more secure than money orders. Although there are check scams involving fake cashier’s checks and money orders, a cashier’s check has more security features than a typical money order. Also, a cashier’s check is backed by a bank and may carry more clout with the payee than being backed by a check cashing store.
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Why use a money order?
There are many advantages to using a money order. A money order is convenient and inexpensive. Grocery stores, post offices, check cashing stores and many other places sell money orders. The fee to order a money order is typically a couple dollars or less, depending on where you purchase it.
A money order is also great for when you want more privacy. A cashier’s check may list your account number and other information typically printed on a personal check. A money order doesn’t have this information, which makes it especially useful for sending money through the mail. Finally, you don’t need a bank account to get a money order.
Money orders cost less.
Money orders are typically used for smaller amounts than cashier’s checks and that is reflected in the fee to purchase one. Depending upon where you purchase a money order, the fee ranges from $0.35 to $2.00. Money orders are typically capped at $1,000. Some places may limit them to smaller amounts.
If you need to purchase multiple money orders to get around the limit, you may be better off getting one cashier’s check for the full amount. If you’re buying several money orders because you’re paying different bills, then multiple money orders should be less expensive than getting several cashier’s checks.
Money orders are easier to buy.
A money order can be easier to buy. They are often sold in places that you’d visit during the normal course of your week: grocery stores, post offices, and some big box retail stores. You could pick one up when you’re buying groceries or running errands. On the other hand, a cashier’s check can only be bought at a bank.
Cashier's Check vs Money Order Comparison
Cashier's Check
- Issued by and purchased at a bank
- Backed by a bank
- Available in small amounts to very large amounts
- Typical fee is between $5–$10
- Considered more secure than a money order
- Useful for large and person-to-person transactions
Money Order
- Purchased at retail stores, post offices, check cashing places, banks, and more
- Backed by the store that sold it
- Maximum amount is $1,000 or less depending on where it’s bought
- Do not need a bank account
- Typical fee is between $1–$2
- Considered less secure than a cashier’s check
- Useful for small transactions and those made through the mail
FAQs
Cashier's checks are issued by a bank, are available in higher dollar amounts, are considered more secure than money orders, and have higher fees than money orders.
What's better, a cashier's check or money order? ›
Cashier's checks cost more, but let you send more money. Money orders are cheaper and easier to buy, especially if you don't have a checking account. Margarette Burnette is a NerdWallet authority on savings, who has been writing about bank accounts since before the Great Recession.
Why is a money order safer than a check? ›
If you're making a one-time purchase, and want physical proof of the exact amount, money orders are a secure option. Plus, money orders do not contain your personal information, such as your account number. Some bank accounts come with free money orders, such as our MaxMoney® checking account.
What is better a certified Cheque or money order? ›
Bank drafts and certified cheques are considered to be more secure because the funds are guaranteed by a bank. Money orders are guaranteed by the person paying, but funds are required upfront instead of being held in a bank account.
What makes a cashiers check different? ›
With a cashier check, the bank itself guarantees the funds from the bank's own account rather than your personal account. Since the bank stands behind the check, it is a safer form of payment than one coming from a personal bank account.
What is the downside of cashier's check? ›
Risk of fraud is also high with cashier's checks, as counterfeit cashier's checks can be created by scammers. Last, cashier's checks are non-refundable. This means you may not be able to get a refund for the funds used to purchase them.
Do cashiers checks clear immediately? ›
Generally, if you make a deposit in person to a bank employee, then the bank must make the funds available by the next business day after the banking day on which the cashier's check is deposited.
When to use a cashier's check? ›
Consumers often use cashier's checks to pay a merchant or vendor that requires cash and won't accept personal checks. Cashier's checks also are used in cash trades that must settle quickly, such as with real estate and brokerage transactions.
Can a cashier's check bounce? ›
Unless a cashier's check is fraudulent, there's almost no risk that it will be declined, or "bounce." They're fast. Banks must make the first $5,525 available within one business day. However, additional funds or amounts the bank suspects may be fraudulent may be held longer.
Is there a limit on cashier's checks? ›
Cashier's checks are typically used for larger purchases. Although the policy may change from bank to bank, generally there's no upper limit for a cashier's check. The payee typically has quicker access to a larger amount of the funds with a cashier's check.
If a cashier's check is not genuine, and, you unknowingly accept a fraudulent cashier's check in exchange for goods or services, you will likely be the one who suffers financial loss.
Why would someone want a cashier's check instead of cash? ›
A cashier's check, which is drawn by a bank on its own funds, cannot “bounce” or be returned for insufficient funds. A cashier's check has been and still is a trusted method to conveniently transfer sums of money that are often larger than you would want to carry or transfer in cash.
What if I decide not to use a cashier's check? ›
The short answer to this question is yes, a cashier's check can be voided. However, the exact process will depend on your bank and whether you are in possession of the check-in question. Generally, most banks take around 90 days to refund the voided check and also charge a cancellation fee.
What is the advantage of using a cashier's check? ›
Cashier's checks are a safe, reliable way to make payments of large amounts and in transactions where cash or personal checks are not accepted. When a cashier's check is a legitimate check issued by a bank or credit union, it's drawn against the financial institution's funds, it's not going to bounce.
Is a cashier's check a good form of payment? ›
Cashier's checks are typically deemed a safe way to make a large payment on a purchase. The difference from a regular check is that the bank guarantees its payment, not the purchaser.
Are cashier's checks more secure? ›
Cashier's checks and certified checks are both official checks issued by a bank. Both are easy to get, relatively inexpensive and considered more secure and less susceptible to fraud than personal checks.
