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When someone writes you a personal check, you have a couple of different options for cashing the check. Banks, credit unions and check-cashing service stores are the primary options to cash a personal check. The procedures for cashing the check or the check cashing policies may vary slightly from institution to institution, but primarily the steps are the same.
First, you have to choose the place where you can cash a personal check. If you choose a bank or credit union, it is best to use your own financial institution or the institution where the check is from — the check writer’s bank or credit union. Typically, if you have an account at the bank or are planning to cash a personal check from the issuing institution, then you generally do not incur a fee. Check cashing service stores tend to charge a percentage of the check amount as the fee for cashing the check.
Turn the check over to the back. You’ll see an endorsement line or box on the upper end of the backside of the check. A check endorsement is usually just the signature of the person that the check is made payable to. If you are planning to cash the check at your own bank, the bank may also require that you write your bank account number under your signature. Make sure you sign the check just as it is made out on the front of the check.
Once you prepare the check and take it to your institution of choice, you generally have to show a form of legal identification. Legal identification is usually your driver’s license or your state issued identification card. Government issued picture identification cards are also forms that banks and check cashing institutions accept. It is important that the legal identification has your picture, signature and legal name information as it appears on the check.
A bank where you have an account may not require that you show legal identification to cash a personal check. Some banks only require that you slide the bank issued debit or ATM card. You will also have to enter your personal identification number (PIN), if you opt to slide your debit card in lieu of showing a picture identification card.
Banks and credit unions will hand over the full amount of the cash the check is written for. A check cashing store or service, on the other hand, will deduct its fee out of the check amount. You will receive the difference between the check amount and the fee amount when you cash a personal check this way.
I have always found it easier to cash a payroll check or government check than a personal check. I've gotten to the point in my own business where I have stopped accepting personal checks. There's too much of a risk the check will bounce or be written on a bad account.
I agree with AnswerMan about the trouble with not having a bank account when you want to cash a personal check. I've never used one myself, but I know some people who rely on a personal check cashing service. The checks are usually high enough that the cashing fee isn't too bad, though. I don't know if I'd do it for a nominal personal check. I'd be tempted to ask the person who wrote the check to pay me in cash instead.
I didn't always have a bank account of my own when I was in my early adult years. Sometimes people would write me a personal check for tutoring services, and I had the hardest time finding out where to cash a personal check. There were a few grocery stores that would do it as long as I agreed to buy a certain amount of groceries. If there was a local branch of the bank the personal checks were drawn on, I might be able to cash them by presenting personal identification.
I found that a lot of banks and other places were very reluctant to cash personal checks if the presenter didn't have a bank account somewhere. I had to sign over a few checks to my parents so they could deposit them into their bank account and withdraw the cash later.
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