How To Cash Your Check When You Have No Bank Account

by The Smarter Wallet on June 15, 2010

When people don’t have bank accounts, I’ve often wondered what people do when they need to cash a check. I really started wondering about this a few years ago when I thought that it might be possible that I would lose my bank account thanks to some really bonehead decisions and a bank that was pretty inflexible when it came to dealing with it (aren’t they all?)

How To Cash Your Check When You Have No Bank Account

What I soon realized after looking around was that there were many avenues for individuals with checks to cash them, for a small or even not so small fee. Here’s what I’ve found:

Local Banks

This is most likely the cheapest route to go if you are trying to cash a check and have no bank account to deposit the money into. If you hold a check that is drawn on a bank that has a branch in your area, odds are, you’ll be able to cash it for a small fee. This fee is usually $5 or less (unlike many other bank fees that do exist). What’s nice about this option is that since the bank can verify that the funds are available for withdrawal, you can cash any type of check here as long as it’s drawn on the bank you’re trying to use to cash it.

If you have received a check from a lender that is in close proximity to a local bank, ask whether or not the bank will cash the check. In many instances they will, especially if the lender has been in the neighborhood for awhile and has built a relationship with the bank.

Tip: Why open a bank account? Because banks pay you to save, in some cases. Your life will be much easier with the convenience afforded by internet banking, which you can use for electronic transactions (you won’t need to deal with physical checks if you go this route).

Retail Stores

Grocery stores and large retail establishments like Walmart are one of the best (and cheapest) places to cash a government or pre-printed payroll check. Most charge a flat fee of $3-$5 to cash the check, regardless of the amount of the check. The main drawbacks to this type of arrangement is that there are limitations on what types of checks are accepted for payment (read-no personal checks) and in most cases there is an upper limit to the amount you can cash with these institutions. I think the last sign I noticed at my local grocery store was $750 max, so no IRS refund checks of $5,000 need apply.

Payday Advance

Believe it or not, a bunch of payday advance companies decided to expand their business into check cashing. They’ll accept many more types of checks for cashing than retail stores including larger amounts and from a larger variety of issuers such as personal loan companies. For this consideration, the payday advance company will charge you a fee, which can either be a flat rate or a percentage of the face amount of the check, both of which will cost you more than the retail store would. But hey, if you have a check that a retail store won’t cash, here’s another option.

Pawnbrokers

Pawn shops will cash checks for you, but it’ll cost you. A pawnbroker will charge a fee for his services that is commensurate with the amount of risk he’s taking that the check will come back as insufficient funds. Just as with a payday advance location, a pawn shop will accept a wider variety of checks than retail stores, however, the price for this service will be considerably higher.

Signing the Check Over

While this is probably one of the least expensive ways to go when trying to get a check cashed, it may be one of the hardest. If you find yourself in a pinch, you can sign the check over to someone you trust (and who has a bank account) and have them cash the check for you at their bank. Because the individual has an active bank account at the bank in which he or she is cashing the check, there are usually no fees involved. However, asking someone to do this for you can be a humbling experience.

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{ 2 comments… read them below or add one }

1 CreditShout June 16, 2010 at 10:25 am

The only establishment I’ve seen that would cash a check are these really seedy pawn shops that I don’t think I would ever step foot in. They’re always in the worst part of town; I don’t know how long you would last if you cashed a check there and then had to walk back to your apartment or car! I would feel safer going to Wal-Mart or a grocery store.

2 marshall October 27, 2011 at 12:36 am

I can’t believe that you people never warn of chex systems or tele chek when advising bank hopping and check cashing. Anyway before you bank hop, make 100% sure the bank you leave has closed your account and you are cleared in writing. I drained an account at wells fargo in the past and just left it around assuming that with no activity, the bank would just close the account. WRONG!! They charge you so much as a quarter for a statement they sent you even after you’ve gone, and you end up in a bad place.

It’s called chex systems and very few people are aware of this place. To make it brief, once on that it is impossible to open a bank account almost anywhere. And you stay on chex systems no matter what you do to remedy it. Cashing at any retail place poses another nightmare lurking in the shadows. If you run a check through a store it’s not the person who issues u the check that will burn if it bounces, it’s solely your problem. You are sentenced to a little place in a data bank i call hell but known to very few. I listed the 2 i’m familiar with above. Get in either of those data banks and you’re sunk writing a check anywhere that has the technology to scan a check. You can get off both of these but it’s a hassle and they charge you, takes almost a month to do it. The place to cash a check without your own account is the bank listed on the top of that check only. They cash it and it’s their problem, period. When i was in chex systems and having the check cash nightmare so many people were blind when i mentioned chex systems. Those bank accounts and transfers are a nightmare, you damn near need a notary and a bank ceo to let you close an account safely. Look into chex systems — I encourage you all.

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