You have a check in hand that you need to cash right away. Maybe it’s a credit card cash-back refund or a mail-in rebate check. Or perhaps it’s a paycheck. Whatever the case, it should be no problem at all, right? You visit the bank, give the check to the teller, and walk away with the cash. It sounds simple, but that’s not always how it works.
Why so? According to a recent survey conducted by the Federal Deposit Insurance Corporation (FDIC), seven percent of households are unbanked. That’s a whopping 9 million consumers. And if you fall into this category, using the bank may not even be an option. However, the good news is there are other ways to cash a check without spending a fortune.
So, where can I cash a check? Read on to explore your options.
Where to Cash a Check if You Have a Bank Account
Do you have a checking or savings account at a bank or credit union? If so, you don’t have to think twice about where to cash personal checks. In fact, you should be able to do so via the mobile app or ATM if you’re unable to make it to the branch.
Credit union members get the luxury of depositing at locations across the United States that are a part of the shared network. (ATM deposit capabilities may also be available).
But there’s a significant drawback you should be mindful of: some banks don’t release the funds to you right away. For larger amounts, the funds availability policy may restrict your access for one business day or longer. And if you are a new account holder, there’s a chance the funds won’t be available until the check clears the writer’s bank.
Where to Cash a Check Without a Bank Account
Don’t have a bank account? No problem. You still have several options to cash checks without spending a fortune. And depending on which place you choose, you may be able to cash your check for free.
Open a New Bank Account
Have you considered opening a new account to cash your check? This is a free way to cash the check. And depending on the amount, you can use the check to make the opening deposit. But, the hold time may be longer if you’re new to the bank or credit union.
What if you don’t qualify for a traditional checking account because of your poor banking history? Some banks offer second chance banking to consumers with ChexSystems or Early Warning Services (EWS) reports. So, try speaking with a banker to determine if you qualify.
Bank of Origin
You can visit the issuing bank or credit union listed on the check. It usually appears on the left-hand sign below the line designated for the long-form amount of the check.
Depending on the bank, a nominal check-cashing fee may apply. (Note: you should expect to pay a fee if you don’t have an account). Also, prepare to present a valid form of identification, like a driver’s license, passport, or state-issued ID card, so that the bank can confirm your identity. But you’ll have the funds right away if they’re available in the account.
This option may also be worth considering if you have a bank account but prefer not to wait to access your funds.
Major Retailers and Grocery Stores
Big-box retailers, like Walmart and Kmart, offer check-cashing services to consumers. It’s unnecessary to make a purchase, but prepare to fork over a small percentage of the check amount and a flat fee to complete the transaction.
Walmart will cash payroll checks, government checks, tax refund checks, cashier’s checks, insurance settlement checks, and retirement disbursement checks. The amount of the check cannot exceed $5,000, and the maximum fee is $6.00.
Kmart will also cash payroll checks and two-party checks, but this service is only available to Shop Your Way members. Checks are limited to $5,000 ($500 if two-party personal), and the fee will not exceed $1.
Visit the store and speak with a customer service representative to learn more. If there isn’t a Walmart or Kmart in your local area, check with other major retailers or local grocers, as they may also offer check-cashing services.
You can also visit a payday lending or check cashing store to swap out your check for cash. These types of stores also sell money orders. Check cashing fees vary by location and brand but expect to pay a flat fee plus a percentage of your check. Generally, the funds will be issued at the time of your visit. But the representative will have to call the bank to confirm that you have an adequate balance to cover the check.
Prepaid Debit Card Accounts
Prefer not to open a bank account or visit a check cashing establishment? You can buy a prepaid debit card and deposit the check into the account to access funds. Most prepaid debit cards, like NetSpend, and Bluebird by American Express, allow you to make deposits from your smartphone. But you may have to wait until the check clears to make withdrawals or purchases.
Some convenience stores, like 7-Eleven, have self-serve kiosks from Refund Advantage that enable you to cash checks for a fee. Most are available for use during business hours, but you may also be able to use select check-cashing kiosks 24/7.
Where to Cash a Cashier’s Check
Cashier’s checks can be cashed at all the same places mentioned above. In addition, most banks and credit unions will cash a cashier’s check for you. If it’s not your bank or the bank that issued the check, you will most likely be charged a fee.
The main difference between a cashier’s check and a personal check is that the funds for a cashier’s check are guaranteed by the financial institution that issued the check. Therefore, they are generally less likely to bounce.
Which option is best?
It depends on how fast you need the funds and what you’re willing to spend. Banked consumers have the luxury of fee-free check cashing, and not all checks are subject to extended (if any) holds.
If you’re an unbanked consumer, opening a checking or a prepaid account is always an option. And even if you’re forced to deposit the check and wait until it to use the funds, you’ll save money. But if you need cash fast, you can visit the writer’s bank, local check cashing establishment, or stores that offer these services.
What happens when a check bounces?
If you deposited a personal check at your bank, there’s a possibility the entire amount was reflected in your balance but unavailable for withdrawal. The funds were also available to cover any debit card purchases, electronic funds transfers, or ACH transactions.
But what if the check doesn’t clear or is returned to the issuer for insufficient funds? You’ll be on the hook for the amount spent and any overdraft fees incurred.
Whether you’re a banked or unbanked consumer, there are several ways to cash a check and access the funds you need without pulling your hair out. However, you’ll probably have to pay a small fee if you don’t have an account at a financial institution.
But if you cash checks often and are getting fed up with paying fees, it may be worthwhile to explore checking account options. Even if you’re in ChexSystems or EWS for poor banking issues, there may be low-cost second chance banking options available to you.