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Instructions and Problems With Signing a Check Over

When a check is payable to you, you’re the only person who can do anything with it. You can potentially sign the check over to somebody else (so they can cash it or deposit it), but that practice has several pitfalls. When all goes well, though, another person can use a check that’s made out to you.

How to Do It

To sign a check over to another person or a business, verify that a bank will accept the statement. If you get approval, endorse the back of the bill by signing it. Some banks require you to write “Pay to the order of [Person’s First and Last Name]” under your signature, and others only need the person who is depositing it to sign their name under yours. Next, provide the check to that person so they can deposit or cash the check.

Will the Bank Allow It?

Banks might not be willing to accept checks that have been signed over to a third party (that is, somebody besides the check writer and the original payee). It’s perfectly legal to try, but banks aren’t required to honour your instructions. Banks may have policies against this practice, or they may think that a third-party check is a red flag, so they can refuse to deposit or cash these checks.

Ask before you endorse: If you insist on signing a check over to somebody else, have them check with their bank before you approve the bill.

You don’t want to add extra signatures and names to the back of the check (which can create confusion and delays at the next place you try to cash the bill). Find out if it’s allowed first, and learn what the requirements are.

Things might go more smoothly if you go to the bank with the person depositing the check, so the bank has more confidence that nothing fishy is going on. (Bring ID, of course.)

Banks are essentially giving your money to somebody else when you use this approach. Unfortunately, the risk is often too significant for them to accept. When a bank can’t verify your identity or your signature, they just have to take the third party’s word for it.

Alternative Solutions

Signing a check over to somebody is not an ideal solution, and sometimes it’s simply not an option. The strategies here might be slower than endorsing a check to someone else, but at least you can be confident that they’ll work.

If You Have a Bank Account

If you need to pay somebody with money you’ve received by check, try cashing or depositing the check yourself to avoid any hassles. The first $200 of funds will typically be available from a review within one business day (or the first $5,000 if it’s a cashier’s check). There are numerous ways to send money online for free, and those methods might be a lot easier than dancing around bank policies.

If You Don’t Have a Bank Account

If you don’t have a bank account or any other way to handle checks, consider opening an account. Some types of bank accounts can cost money, but not having an account probably costs you more—in both time and money. There are several ways to get free checking accounts, especially at local credit unions and online banks.

If it’s simply not feasible to open a bank account, you could try a check-cashing service, but those fees are typically relatively high. Several retail stores have been known to cash checks for free, especially tax refund checks. If It’s Difficult to Get to Your Bank

If your bank doesn’t have a branch or ATM where you are, or it’s inconvenient for you to get there, these two solutions might make your life easier:

  • Mobile check deposit: Your bank might allow you to take a picture of a check—often until late into the evening for a same-day guarantee. Then you can withdraw cash or send money electronically.
  • Credit unions: If you’re a credit union customer, then you might be able to use branches of other credit unions (assuming they participate in the shared branching network).If You Want to Pay Without Cash

When your bank doesn’t offer mobile deposit or you’re looking for an inexpensive solution, prepaid debit cards might meet your needs. Just be wary of high-fee cards; prepaid providers are required to disclose all fees to you before you purchase a card. If you’re trying to pay without cash because you’re concerned about theft (in the mail, for example), write a check or pay with a money order instead.

Depositing a Check for Somebody Else

If somebody asks you to deposit a check written to them, think carefully before you do so. You are risking your own money and your good standing at the bank if you agree. If the check bounces for any reason, your bank will demand that you replace the funds, even though the review was written to your friend—or by somebody else entirely—and you were just trying to do somebody a favour.

If you deposit a bad check, the funds will eventually be taken from your balance, and your account could go negative (resulting in a chain reaction of problems). You can try to collect funds from your friend, but this is often difficult. Also, never agree to cash a check for a stranger because it’ll likely be a scam.

Don’t Get Scammed

How can you lose money by helping somebody? Your bank will often allow you to get cash from a check immediately, or the funds appear in your available balance, making it look like you can spend all of that money if you want to.

Later, your bank processes the check and tries to collect money for it. It can take days or weeks for your bank to find out that a review was bogus, so don’t hand over cash unless you trust the person you’re helping. Unfortunately, if you cash a check for somebody else and the review is terrible, your bank will not reimburse you.

You’ll have to ask that person—if you can find them—and possibly bring legal action to collect the money.

Where Is the Account Number on a Check?

You typically need your checking account number to set up electronic payments or direct deposits. The easiest way to find that number is on a personal check (but there are other solutions if you don’t have bills handy).

The account number is located at the bottom of your check. There should be three sets of numbers in a particular computer-readable font at the bottom:

  1. The first number on the left is your bank routing number.
  2. The second (middle) number is your account number.
  3. The third number is your check number.

For example, see the image on the top of this page. This layout applies to most personal checks, but business checks (and online bill payment checks) may differ. You can generally find the account number on a review by locating the following symbol: ⑈. The digits just before that symbol are your account number.

Other Numbers on Your Check

If you need to provide an account number, there’s a good chance you’ll need to provide other details from the check as well. Your account number by itself is not sufficient to create a link to your bank account for direct deposit or automatic bill payments. Routing Numbers

The number on the far left is generally your bank’s routing transit number (RTN) or American Bankers Association (ABA) number. That nine-digit code identifies your bank, but it does not remember your specific account at that bank. 

The set of numbers on the far right should be a check number, which is helpful when researching an individual check for your accounting. A check number does not reference your bank or your account—it’s just a unique identifier for every review you write, helping you track your spending and balance your chequebook. Check numbers are not crucial for processing payments. Check numbers can be re-used or used out of sequential order without significant problems.

Business Checks and Bank-Printed Checks

The format described and shown in the example above applies to most personal checks. However, bills that come from businesses (such as payroll checks) and reviews that your bank has printed out might have a different format.

Checks mailed by businesses or sent from online bill payment services often have account numbers as the third set of numbers from the left.

Those checks may use the account and routing numbers different from the numbers on your reviews to complicate matters further. If you try to copy your account number from a check printed using your bank’s online bill payment tool, you’ll get an account number that does not map directly to your account. Instead, that number points to a store that your bank uses for bill payments. You won’t be able to use those numbers to link your account for direct deposit, Automated Clearing House (ACH) payments, or wire transfers. It’s best to use a recently printed personal check to find your account information. If you have any doubts about which numbers to use, just contact your bank and get the details.

Ask Customer Service

A customer service representative at your bank can tell you everything you need to know to get your automatic payments set up. They’ll need to know exactly which account you want to use because ABA numbers may vary depending on where you opened your account. You might also be able to find this information online when you’re logged into your account. Look for a direct deposit form, account details area, or instructions for setting up Electronic Funds Transfer (EFT) and ACH.

Getting the account number right is worth a few minutes on the phone with customer service. Consider the consequences of an improper setup: You might not get paid on time, and you might end up bouncing checks or missing payments for essential things (like your mortgage or student loan, which can lead to severe headaches and expenses). Get it done right the first time, and then let everything run on autopilot—that’s the whole point of signing up for electronic payments.

If You Don’t Have Checks

It’s easy to find your account number on a check, but what if you don’t have any reviews? The next best place to look is your monthly statement. Your account number is partially hidden (especially if you view notifications online), so you may need to call or chat online with customer service. You may also be able to click on something that enables you to expand or “show” your whole account number.

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How to Scan and Email Voided Checks Safely

Electronic payments from your checking account can be convenient, and this payment method also helps you avoid extra convenience charges. But emailing the image of a voided check to a vendor is a risky way to provide your bank account number and a routing number—both of which are necessary for Automated Clearing House (ACH) payments. 

Fortunately, there are several ways to keep your personal account information secure. Learn techniques for adequately sending a voided check electronically and other payment methods that may work better.

Emailing Check Images

ACH payments transfer funds electronically from your bank account to a vendor without the need to write a separate check for each amount. To set up fees, however, vendors need your bank account and routing numbers. To gather that information, vendors often request a voided check.

You can use your checking account to pay for utilities, insurance, and other recurring expenses.

Checks contain personal financial information, including your routing and account numbers, along with your name and address. Identity thieves can use this information to pull funds from your checking account. Even if you void the check, the numbers are still visible, and that image may exist—meaning it can be copied or stolen—for many years.

In most cases, this isn’t a problem. Vendors are unlikely to steal from your account, and the image might be safely stored or deleted after it gets used. But if fraud occurs, the risk is significant. When thieves access your account, you could lose money, and the domino effect can make life difficult. For example, you might end up bouncing other checks or missing payments because there’s not enough money for necessary expenses. Plus, you spend time and energy cleaning up the mess.

You may be protected from fraud in your account, but you need to act quickly for maximum protection. Contact your bank immediately if you suspect fraud. Once you notify your bank or credit union, the organisation generally has ten business days to scope out the issue. 

Pay From Your Checking Account (Electronically)

Instead of just emailing a check-in plain sight, there are more secure methods of paying. If vendors do not have a secure website where you can enter your account and routing numbers securely, protect yourself with the techniques below.

Encrypted PDF

One way to solve the problem is to send the check image as an encrypted PDF, which requires the recipient to enter a password before viewing the document. Be sure to provide the password securely, and don’t email it unless you use different email addresses. It’s best to call the recipient and deliver the password verbally, but you also could send the password as a text message. rd to a PDF by using the Protect menu. Then, select Encrypt, and Encrypt with Password. If you don’t have Adobe software, you can encrypt passwords online, as well.

Password-Protected File

It’s possible to add a password to other types of files, too. If you can’t create an encrypted PDF, you can set an added password protection on the file. This will vary depending on the type of computer you have. Microsoft Office users, for example, can select File, Info, and Protect Document. Consider Faxing

If you’re having a hard time securing a file for email, ask about faxing the check image instead. Unlike emails that may get backed up and targeted by hackers, faxed documents might not sit around forever. Stealing information from a fax transmission is more cumbersome than forwarding an email.

To send a fax, you can visit a local printing or shipping office or use an online service to send a fax from your computer or mobile device. Note that when you upload a document to an online service, that service could get hacked, so that old-fashioned fax might be the most secure solution.

Snail Mail

If there’s no rush, it may make sense to mail the check (or direct deposit form with your check image). Of course, the bill could get lost, and thieves could use the information, but most letters make it to their destination safely.

Electronic Payments From Checking

If you’re hesitant to send your account information to somebody, find out if you can send payments from your checking account. Instead of having the amount pulled from your account, you can push out costs yourself. Your bank’s online bill payment feature may be able to send payments electronically or by paper check. You can often automate payments and schedule them to go out on a specific day of each month.

When you set up online bill pay with your bank, you keep your information private, and you’re in control of the timing and amount of each payment.

Why Emailing a Check Is Risky

Technically, you expose your account information every time you write a check, so you might wonder if it’s any worse to email an image of your review. When there’s a paper check involved, the only way to use the information is to get a copy of the bill. In most situations, the statement is destroyed soon after it is uploaded to a secure system. It might be photographed or turned into an electronic image, but those copies generally are safe.

Email is not a secure system. When you send a message, it moves through numerous computers, some of which might have malicious software installed. What’s more, you don’t know how careful your recipient is with his email account. Even if the message gets deleted promptly, an archived copy of that message might exist for a very long time.

Regardless of how you pay your bills, it’s wise to monitor your bank accounts to limit your risk. The easiest way to do that is to set up email or text message alerts that notify you whenever money leaves your account.

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