How to process lost cashier checks

ImagePixel/Getty Images;Illustrated by Issia Davis/Bankrate

Cash register checks are paid upfront and generally do not bounce, so they are a reliable form of payment. However, losing one of these checks can make it even more complicated. Banks cannot simply cancel cashier checks because they have already been paid. You may need to file a request with the issuing bank to reissue the check, and there may be a waiting period.

What is a cashier’s check?

A cashier’s check is a form of payment issued by a bank or credit union on behalf of a client. Unlike standard checks, the cashier’s check values ​​are paid upfront. This means that the checks are already paid when they are deposited and supported by bank funds, so they won’t bounce back.

Some merchants and vendors may not accept personal checks, but they accept cashier checks because there is a low risk of the check being forged or bouncing.

Cash register checks are usually used to make bulk purchases for transactions that are not hoping to carry this amount with you in cash or to protect the seller. Cash register checks may be used when purchasing a home, for a security deposit before purchasing a home, for a car or other purchase.

Scott Billuncott, legal director of the Wisconsin Banks Association, says banks are required by law to pay cashier checks.

“So, if the cashier’s check is lost, the bank can stop paying, but if it finally appears, it’s owed to pay it,” says Billuncott. Once the specified period expires, when a suspended payment is made to the cashier’s check, the bank will not pay the items, Billuncott says.

The duration may vary depending on the condition, but it is usually 90 days. According to the office of the Currency Secretary (OCC), your bank may be able to ask you to obtain compensation obligations against the amount of the lost cashier’s check before issuing a new one. OCC defines compensation bonds as a type of insurance contract. The insurance policy guarantees that if a Lost Check is ultimately discovered and presented for payment, it will be liable (on behalf of the Bank) for losses.

Wells Fargo, for example, requires an indemnity agreement as a condition of suspension and reissue, according to the Wells Fargo website.

Chris Powell, head of deposits and customer engagement at Citizens Bank, says Citizens will be subject to a waiting period when a customer notifies the branch of a lost or missing check.

After that waiting period ends, customers can visit the branch directly to exchange items, Powell says. Before replacing, the branch must ensure that the check did not “pay”.

What if I lose my cashier’s check?

Losing a cashier’s check is very different to losing a personal check, as it is generally not possible to stop an official bank check immediately. Meanwhile, depending on your bank’s policy, you may be able to make an immediate suspension payment on your personal check.

Because cashier checks are paid upfront, issuing banks are generally unable to “stop payment” to checks until up to 90 days after the check is reported to have been lost or stolen.

“The lost cashier check is not the end of the world, but the law requires a series of steps to replace it,” says Powell. “If you suspect your cashier’s check is lost, theft, destruction, or fraud, contact your bank immediately.”

1. Please contact the bank: The first step is to contact the bank that issued the lost check. If you are the recipient of the check and you are unsure which bank issued it, you may need to find out which bank you purchased from to get in touch with the payer.
2. File a claim. The bank asks you to fill out a “Declaration of Loss” statement. This statement is a legal claim and declares that we have lost our check. However, the declaration of loss is not enforceable until 90 days after the check is issued. That 90-day window is there to give you time to find a check.
3. I’ll wait 90 days. Typically you will have to wait up to 90 days for a new cashier check to be issued. For example, in a state like Wisconsin, the wait may only be 30 days due to state law, Bilencott says.

If the check is lost 90 days later, the original check with the suspension payment will essentially be invalidated and the bank will reissue the cashier’s check.

Conclusion

A real cashier check is a guaranteed payment format, but losing it can be a complicated process. It is important to contact your bank immediately and fill out the bank’s related form.

It is important to handle cashier checks as if they were dealing with actual cash, and take the necessary steps to protect yourself and your finances when dealing with lost cashier checks.