What type of check is drawn on a bank's own funds and signed by an authorized bank official?

A cashier's check is a type of check that is drawn on a bank's own funds, meaning the funds are guaranteed by the bank itself. When a customer requests a cashier's check, the bank will withdraw the amount of the check from the customer's account, or the customer pays the bank the amount upfront. The bank then issues a check that is signed by a bank official and is backed by the bank's own resources. This guarantees that the check will not bounce since it is drawn against the bank's funds.

This type of check is often used for larger transactions where a secure payment method is necessary because it assures the payee that the check is legitimate and that the funds are available, as the bank is responsible for payment. Cashier's checks are commonly used in real estate transactions, vehicle purchases, and other significant financial dealings where the payee requires the assurance of funds.

In contrast, other options like certified checks involve verifying that a customer's personal funds are available, money orders are typically issued by retailers or post offices rather than banks, and traveler's checks serve a different purpose as a prepaid form of payment designed for use while traveling. Each of these alternatives has its own specific functions and characteristics, distinguishing them from the guaranteed nature of a cashier's