How to verify a cashier's check is legit

[Bikerdude]

From what I've heard, even Banks cannot tell immediately that a cashier’s check is bad. Sometimes the money will be credited to your account only to later find out the check is bad. From what I've read you are responsible for the money if you have withdrawn it.

 

[W2R]

From what I've heard, even Banks cannot tell immediately that a cashier’s check is bad. Sometimes the money will be credited to your account only to later find out the check is bad. From what I've read you are responsible for the money if you have withdrawn it.

What a nightmare! Whew. Glad I am not in that predicament.

 

[REWahoo]

Thanks everyone for your input. I'll let you know how it turns out.

 

[teejayevans]

From what I've heard, even Banks cannot tell immediately that a cashier’s check is bad. Sometimes the money will be credited to your account only to later find out the check is bad. From what I've read you are responsible for the money if you have withdrawn it.

No, when you deposit it, they don't care, then once is goes through the clearing process
is when the bank that wrote the check clears it or marks it invalid, just like any other
check. So yes, it will be credited and then withdrawn up to 30 days later, but usually
within a few days, by that time of course they long gone.
The scam often includes a story about having money in foreign account and they will
give you a check from their business account, unfortunately they wrote it for $3K more
than the price, they ask you to wire balance of the money back to them.
Its hard to believe, but people actually buy that garbage.
Tom

 

[whitestick]

According to BankersOnline.com, "From Bankers, For Bankers" , a stop payment order on a cashiers check is a big no-no:

Question: When can a stop payment be placed on a cashier's check?

Answer: One cannot place a stop payment on a cashier's check.

Oh Crap! Thanks REWahoo. Did I mention it was a long time ago. It may have been a money order rather then a cashiers check. It's been so long, and my mind has gotten a bit fuzzy, that I may have been mistaken. I just remember that whichever it was, I had thought that there was no way to stop payment on it, as it was supposed to be committed funds, but to my surprise they did stop payment on it, and it was supposedly legal to do so in that state. I already stated the rest of the story earlier.
Anyway, thanks for keeping me straight.

 

[igsoy]

It seems the surest solution would be to have the buyer pay in USPS money orders. They can be worth up to $1000, and cost 1.30 each.

When your buyer arrives, you go with them to your post office and get them cashed in person. If they don't have enough cash on hand to cash that much for you, cash as much as they can and then go to the next closest post office to do the rest.

 

[youbet]

This thread makes me wonder how private sales ever take place!

The seller wants cash guaranteed not to be counterfit. The buyer wants recourse if the seller has not disclosed hidden defects. Everyone other than the buyer and seller want them to take off their shirts and pound each other with bare fists until the blood flows freely!

 

[cute fuzzy bunny]

There were a rash of faked postal money orders not that long ago...

 

[free4now]

I like the idea of cashing the check in person with the other party present... no criminal passing a bad check wants to be around at the time their crime is discovered, so by forcing them to be present for the cashing you force some level of accountability on them.

 

[SteveR]

I like the idea of cashing the check in person with the other party present... no criminal passing a bad check wants to be around at the time their crime is discovered, so by forcing them to be present for the cashing you force some level of accountability on them.

My credit union will hold the funds from a check for either 7 or 10 days (depending on the amount) so I would not know for up to 10 days if the check bounces or not. I prefer cash or a certifed check, written in blood, with the right arm of the writer attached.

 

[REWahoo]

My credit union will hold the funds from a check for either 7 or 10 days (depending on the amount) so I would not know for up to 10 days if the check bounces or not. I prefer cash or a certified check, written in blood, with the right arm of the writer attached.

After the buyer handed me the cashiers check yesterday, I had him wait to take possession of the boat while I did some checking. I called the issuing bank to verify the date of issue, purchaser's name, the amount, payee's name, and asked for a description of all security features on the check. After verifying each of those items, I handed the buyer a signed title and bill of sale at gunpoint along with my promise to shoot him in an a portion of his anatomy that would insure he would sing soprano for the rest of his miserable life if the check was bad.

I deposited the check at my bank at 1:30 PM yesterday and it showed up online within a few minutes as a deposit to my account but on a "hold" status. The check apparently cleared overnight as the hold was removed.

 

[igsoy]

There were a rash of faked postal money orders not that long ago...

Yes, I know this exists. And of course if you tried to deposit it into your bank, they wouldn't catch it until too late. But if you are cashing it at the post office, they can see if it is legit. There is no waiting for it to clear, it is either legit or not, and if you are standing there with the buyer and they won't cash it, you don't go through with the transaction.

 

[Rich_by_the_Bay]

asked for a description of all security features on the check

What are those? Anything useful to us non-check-pro's?

 

[REWahoo]

What are those? Anything useful to us non-check-pro's?

Here is a list and description of most of them:

http://www.relyco.com/stock_check_security_features.htm

Some are visible to the naked eye ( Gradient Two-Color Pantograph, Simulated Watermark), one requires a magnifying glass (Microprinting), others require a UV light (Covert Fluorescent Fibers), and many only show up if there has been at attempt to copy or alter the document (Copy-Void in Check Pantograph, Anti-Splice Backer, Solvent Reactive Color Spotting, Multi-Language Chemical Void), and my personal favorite: heat sensitive ink (Thermochromic Heat Reactive Ink).

None of these are perfect, but having three or more of them embedded in a document will make it fairly difficult for someone to successfully copy or alter a check. Of course they can always steal the blank stock, so that's why you need to call the bank in addition to checking on the security items.

 

[Brat]

Postal money orders can be redeemed for cash at the PO, no worry about it being rejected by a bank. He takes the position that cash or postal money orders are the most secure. Next a check issued on a bank with a local branch.

 

[dessert]

REWahoo thanks for starting a very entertaining thread. Glad you were able to sell your boat successfully.
I think I have owned 12 boats so I have been in your shoes before. The previous one I sold was over 20 grand and the guy handed me a brown paper bag and said " go count that while I admire my soon-to-be-new boat".
He was local and a dog breeder who had been saving for that moment.
Glad it all worked out for you.

 

[Brat]

My DS & DIL have a boat yard. Their CPA wants them to get away from substantially cash transactions because IRS gets ansy. They have had to tell the CPA that is the nature of the business.

FYI, a boat can be 'arrested' for unpaid obligation. Of course you need to find it first.

 

[MooreBonds]

Just out of curiosity...if a person tries to fake a USPS money order, would that also be considered mail fraud, or does it have to physically be sent through the USPS channels in an envelope to be mail fraud?

Might be one more way to weed out the frauds from the legit if you use a USPS money order...

 

[yakers]

I do not know the regs but I suspect that forging a USPS check is more like counterfeiting than just passing a bad check. It may be slow but someone will follow those up.