In this post I want to answer the question, what is a certified check? My previous post was on where to cash a check.
Some 10 to 15 years I used to work for a food processing company that was struggling financially.
Because of that some of our suppliers demanded that we pay them with certified cheques.
A certified check is a check for which a bank will confirm the existence of sufficient funds to cover the check.
To do this the issuer will take the check to his bank and the bank will stamp and sign confirming that there are sufficient funds to cover it.
They normally also provide the period their certification covers.
The bank will then make sure that that account has sufficient funds during the time specified in the certified check.
How do I get a certified check?
You normally go to your bank with your cheque. The bank will then verify your signature and check your account to confirm the existence of funds. The bank will then stamp the cheque.
What is the difference between a certified check and a cashier’s check?
The difference is that a certified check is a personal check written by a bank customer and certified by the bank to confirm the existence of funds.
However, a cashier’s check is issued by the bank. The customer pays the bank and the bank writes a check on your behalf to your payee.
The money, therefore, comes out of the bank’s account.
Whereas in the case of a certified check the money comes out of the customer’s bank account.
The bank just makes sure that there are enough funds over the period of the guarantee.
How long does it take for a certified check to clear?
Even though it is guaranteed by the bank a certified check follows the same procedures and processes like any check. Normally checks clear within 48 hours but can take longer depending on where the check has been deposited and policies of various banks.
Is a certified check safe?
It is definitely safer than a normal personal check. In any case, it is backed by the bank and banks will make sure that the bank account of the payer has sufficient funds to cover the amount.
Can you cancel a certified check?
Yes, a certified check can be canceled. For instance, if you lose the check you can inform the bank and the bank will place a stop payment.
You might also be interested in, How to cash a check.