money order (2024)

FAQs

What is a money order and how does it work? ›

A money order is a secure way to send money or make a payment — up to $1,000. Many recipients prefer money orders because, unlike a personal check, a money order can't “bounce” and clears almost immediately; therefore, they provide a fast, risk-free form of payment.

While they are often used in the same way as a personal check, money orders are prepaid and cannot be returned for insufficient funds. This may sound much like a cashier's check. However, while cashier's checks are typically issued by banks or credit unions, money orders can be purchased from various types of stores.

Cons: Once a money order is cashed (or lost), it can be difficult if not impossible to get your money back, even if it was due to a scam or fraud. Money orders are subject to cash advance fees and interest if purchased with a credit card. (Read about credit card interest and APR.)

Money orders are more secure than personal checks because they're paid upfront. They're widely available: Banks issue them, as do many grocery stores, convenience stores, gas stations, the U.S. Postal Service and check-cashing outlets. Many issuers of money orders have a $1,000 maximum purchase limit.

Money orders are typically capped at $1,000. Some places may limit them to smaller amounts. If you need to purchase multiple money orders to get around the limit, you may be better off getting one cashier's check for the full amount.

If you need a higher amount than $1,000, you may need to purchase multiple money orders. Keep in mind, if you spend more than $3,000 in money orders in a single day, you may need to show ID and complete a form to prevent money laundering.

Only a $1 maximum fee!

Amount of payment. Cash or debit card to pay for the money order.

Do banks issue money orders? ›

You can buy a money order at any bank or credit union, as well as some drug stores, most grocery stores, convenience stores, and any store that offers check cashing or money services such as MoneyGram or Western Union.

Recipients may prefer cashier's checks because: They're almost equivalent to cash, but the risk of theft is lower because only the payee can deposit a cashier's check. They're guaranteed. Unless a cashier's check is fraudulent, there's almost no risk that it will be declined, or "bounce."

Note: Receipts are referred to as "Customer Receipt".

This receipt is your guarantee for a refund of your money order if it is lost or stolen, provided you fill in the Pay To and From Information on the money order in the space provide.

Sign the front of the money order where indicated. This section may be labeled Purchaser's signature, Purchaser, From, Signer or Drawer. Don't sign the back of the money order, which is where the payee endorses it.

With a money order, there's no need for a bank account. It's a simple and reliable way to give money in person or send it through the mail.

You can cash a money order or deposit it into a bank account. Money orders are readily accepted and converted to cash and are often used by people without access to a standard checking account. They are an acceptable form of payment for debts, both personal and business.