We assume that you are referring to check endorsement, which is the process of signing your full name, and often including your bank account number, on the back of a check. This is done in return for receiving the amount of cash indicated on the face of a check. Typically, people use a "blank endorsement." This means that the check can easily be cashed by anyone who signs their name to the back and presents it to a bank or credit union in exchange for money. This includes situations where a check is lost or stolen, however. For this reason, it is not wise to carry around an uncashed check for any length of time. Additionally, it should be signed only when you are ready to cash it.
Another type of endorsement is called a "restrictive endorsement." This is when the words "For Deposit Only [e.g., to account #123456]" are written on the back of the check along with the signature. In this situation, the amount of the check can only be deposited into an account at a financial institution, and it cannot be exchanged for cash. Cashing a check somewhere other than your own bank or credit union may result in a check-cashing charge.
We would like your feedback on this Personal Finance Frequently Asked Question.
