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drawn directly on a customer's account
, making the bank the primary obligor
, and assuring firm
that the amount will be paid.
by a bank
. In exchange for a fee
, a bank issues a certified check to a person, who is very often both the payer
and the payee
. That is, a person gives the bank the amount for which the certified check is written, either in cash
or by deducting
the appropriate amount from the payer's account; the bank then makes the check payable to that person. The person may cash the check
at any bank, or deposit it at a different bank without being subject to a check hold
. A certified check is also known as a registered check or banker's draft. See also: Traveler's cheque, Commercial draft
A check drawn by a bank on itself. A cashier's check is made out to a designated institution or person and must be paid for before it is issued. See also certified check
An official check issued by a bank with itself as the drawer. Contrast with a certified check, which is one drawn on the bank customer's account, with the customer as drawer, but certified as good by the bank. Closing companies usually require a cashier's check for the purchaser's portion of all closing costs and purchase money. A cashier's check can be the subject of a stop-payment order. Because of widespread forgery of cashier's checks, many closing companies will not complete closing until funds are actually collected and in the closing company's escrow account.