What Do You Do About a Lost or Stolen Cashier's Check?

You Can't Just Stop Payment

Cashier's check
Mike Kemp / Rubberball / Getty Images

A cashier’s check is a form of “guaranteed” payment that sellers like, and these checks are often used for important transactions and large purchases (like a down payment on a home). But what if you lose a cashier’s check or it gets stolen? You’ll want that guarantee removed quickly so the money doesn’t end up in the wrong hands. You might also want to cancel a cashier’s check if plans change and you decide not to use it.

The reason cashier’s checks are so safe for sellers – assuming the check is legitimate – is because the bank promises to pay from its own account. There’s no risk of the check writer bouncing a check, and any legitimate cashier’s check will be honored (unless there’s clearly fraud involved, such as a forged endorsement).

If you could simply stop payment on a cashier’s check, they would become less useful. But there are ways to protect yourself and get your money back, depending on your situation:

  1. When you no longer have the check (it’s been lost or stolen, or you want to “stop payment”), you’ll fill out forms with your bank requesting that the funds be returned to your account
  2. When you still have possession of the check and simply want to cancel, you’ll return the check to your bank

Unfortunately, it takes time, and your bank might not honor your request. Learn about the details below.

Lost or Stolen Cashier’s Check

If your check is lost or stolen (whether you’re making a payment or you received it as payment) you’ll want to contact the bank immediately.

Again, you can’t stop payment on a cashier’s check, but it is a good idea to let the bank know that something is happening with the check so they can flag it for a closer look in case it comes in.

To report a lost or stolen check, file a declaration of loss with the bank that issued the check (if you received the check, hopefully, you have a copy of it or you can find out who issued the check).

This is a written statement made under penalty of perjury that you don’t have the check and you’re not going to find it.

When you file a declaration of loss, you make a claim to the funds, but you won’t receive the funds until the later of:

  • 90 days after the check was issued, or
  • 90 days after the declaration was filed

During the 90 day period, the bank might still pay the check to whoever presents it. If the check was stolen, you can assume that the thief needs to forge your signature for endorsement or do something else illegal, so there’s a decent chance the bank will notice (as long as you’ve alerted them to the fact that the check is missing).

On the other hand, if you’ve simply changed your mind about making a payment, there’s nothing you can do to stop a valid payee from depositing or cashing the check and claiming the funds. If there’s been a mistake or dispute, you’ll need to recover the check (or the funds) from the payee another way.

After the 90 day period ends and the check is still outstanding, the bank will release funds to whoever has a claim on the funds (either the payee or the account owner, depending on the situation). If somebody tries to deposit the check, it will be returned (the bank won’t honor the check).

But 90 Days is too Long!

What if you need the money sooner? Cashier’s checks are often large checks, and the bank took those funds from your account (or took cash) when the check was issued. Unless you’ve got plenty of extra cash on hand, you’ve got a problem.

You can always ask for a replacement check, but don’t get your hopes up. Again, the bank is on the hook to pay for the first 90 days after the check was issued, and banks face serious consequences if they refuse to pay on a cashier’s check (unless they have a really good reason). The bank might simply issue a replacement check if they’re willing to risk having two checks out there (if the dollar amount is small and they’re confident that the original check won’t surface, for example), but that’s the exception and not the rule.

Sometimes banks reissue cashier’s checks if you sign an indemnity agreement: if the original check is presented and the bank has to pay, you’ll have to reimburse the bank.

 Obviously, the bank needs to believe that you’re good for the money, and that’s a challenge with large checks. You might even be able to get a bond issued by an insurance company that covers your liability, but that’s difficult and expensive (and is not a realistic option for most people).

Unused Cashier’s Checks (When you Change your Mind)

What if you still have the check but you just don’t need it anymore? For example, you may have decided not to go through with a purchase at the last minute.

You don’t need to file a declaration of loss if you still have the check. In most cases, you can return it to the bank and write something similar to “Not used for purpose intended” on the check. Contact your bank and ask what the requirements are. Your bank should return the funds to your account once they get the check back.

Some banks make it difficult to cancel a check that you’re not going to use. It makes for a poor customer experience, but perhaps they have their reasons. If your bank won’t return funds to you, you may need to wait longer or fight harder (ask to speak to management) to get your cash. Then vote with your feet and open an account somewhere else.

Important Information

If you’re reading about canceling a cashier’s check, you’re obviously in the middle of an important situation and there might be a lot of money at stake. This article is just a starting point – you really need to speak with your bank now that you’ve learned things work in most (but not all) areas, and you should also meet with a local attorney. Find out what the specific next steps are given your bank’s policies and your situation.