How to Cash a Check

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Cashing a check seems simple: Go to your bank and deposit it into your account. But if you're one of the many Americans who doesn't have a bank account, it involves a little more work.

Without a bank account, people hoping to cash a check typically have to rely on specialized services like check-cashing stores and check-cashing options at certain retailers. These services can be expensive but are simple ways to get your hands on your money without using a bank account.

For those with a bank account, cashing a check is as simple as endorsing the back and depositing it into your account, maybe even from your phone. Some checks—like certified checks—can be exchanged immediately for cash, but most take a day or two to clear before your money appears in your account.

Where to Cash a Check Without a Bank Account

If you need to cash a check and you don't have a bank account, check out the following options. Quick tip: It's important to know what type of check you have—payroll, personal, government or certified—before choosing a place to cash it, as some check-cashing services will only accept certain types of checks.

  • Issuing Bank. When someone writes you a check, they are essentially writing on a piece of paper how much money they want to give you from their checking account. As such, the bank the money is coming from is called the "issuing bank." If you don't have a bank account, sometimes the issuing bank will cash your check—because they can see the exact balance of the account being debited. While not all issuing banks do this, some do, and typically for a fee of a few dollars. Call ahead to ask the issuing bank whether you can cash a check without being an account holder.
  • Check-Cashing Store. A check-cashing store is one of the easiest—and most expensive—locations to cash a check without a bank account. All you need is your ID, in some cases two forms of ID, and you can walk out with your money after paying a fee. Check-cashing stores typically charge anywhere between 1 percent and 4 percent of the check's value, and some charge additional flat rates on top of that. Check-cashing stores typically do not cash personal checks. Sometimes stand-alone stores also offer payday loans and other cash services. Find out the fees and check out alternatives before using these sources.
  • Grocery Stores and Big-Box Retailers. Stores like Walmart, Kmart, and even some supermarkets have on-site check-cashing services. These retailers often charge much less for their services and can be good alternatives to stand-alone check-cashing stores. Kmart cashes government and payroll checks of up to $2,000 and two-party personal checks of up to $200 for a fee of only $1. Make sure to have your ID ready when cashing a check at a retailer.

Open a Checking Account

Opening a checking account can come with a lot of advantages, such as paycheck direct deposit and check cashing. To open a checking account, all you need to do is choose a bank and an account type and apply with proper identification.

Unlike applying for a credit card, opening a checking account does not require a credit check. Banks will use your Social Security number to look for any major financial blemishes in your past—like a history of mismanaged bank accounts—but in most cases opening a checking account should be easy.

Most banks offer several checking account options, and the one you choose will depend on how you plan to use the account. Take a close look at the fees associated with overdrafts and minimum balances to help you understand which account is best for you. Here are a few things to consider before selecting a checking account.

  • How much money will you keep in your account?
  • Will you be using a debit card often, or do you need a physical bank nearby?
  • How often do you plan to use your debit card or write checks? Some checking accounts limit the number of these transactions.

What to Do If You Have Been Denied a Bank Account

If you tried to open a checking account but were denied, it might mean the bank found something alarming in your banking history. This history is kept by companies called debit bureaus, and similar to credit bureaus, these companies keep a record of your interactions with past banks. Companies like ChexSystems, a well-known debit bureau, are regulated by the Fair Credit Reporting Act and issue debit bureau reports that banks use to evaluate applicants.

If you were denied a bank account, you should receive information about your denial from the bank, including which debit bureau they used to make the decision. You can obtain a free copy of the reports used directly from the debit bureau. Be sure to inspect your reports closely, as mistakes happen, and inaccurate information could be listed in your reports.

Staying on top of your finances is important in ensuring you can get approved for things like checking and savings accounts. If you have had trouble in the past, think about making a budget and be sure not to overextend yourself. You can find out what appears in your credit reports for free at Experian.

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This service is completely free and can boost your credit scores fast by using your own positive payment history. It can also help those with poor or limited credit situations. Other services such as credit repair may cost you up to thousands and only help remove inaccuracies from your credit report.