Paper checks may not be as common as they used to be, thanks to the increased use of debit cards and digital payments. However, there may be situations when you need to endorse a check to someone else — also known as "signing over a check."
Once these checks are signed over, they're known as "third-party checks."
In this article, we’ll cover the reasons why you may want to sign a check over to another person, how to endorse a check to someone else, and some alternatives to third-party checks.
Reasons To Endorse a Check to Someone Else
There are a couple of reasons why you may want to endorse a check to someone else.
For one, you may not have a bank account of your own. If this is the case, having someone else that you know and trust cash the check for you would save you from having to pay a check cashing fee. If you’re a minor, you may also need to have your parent or legal guardian cash the check for you.
Another reason why you may want to endorse a check to someone else is if you have a bank account but currently don't have convenient access to a bank location or a mobile banking app.
You may also consider signing over a check if you owe someone else the same amount of money. Theoretically, this would make endorsing a check to someone else a convenient time-saver. After all, you wouldn't have to wait for the check amount to be deposited in your bank account before you can withdraw the funds or write a new check.
Steps to Signing Over a Check
If you need to sign over a third-party check, there are a few important steps to ensure it's done correctly:
Make Sure the Recipient’s Financial Institution Will Accept the Check
Before attempting to sign a check over to someone else, ask the recipient to contact their bank and ask about their policies. Banks and credit unions are not legally obligated to accept third-party checks, and not all do[1].
If you sign over a check without asking — and it turns out the bank doesn't accept third-party checks — it could make it difficult to ever get the check cashed at all.
Some banks require both the original payee and the person to whom they're signing over the check to be present when the check is deposited or cashed. If this is the case, make sure you bring your government-issued photo ID to the bank branch.
It may also be a good idea to contact the bank of the person who originally wrote the check to make sure that it will allow the check to be cashed in this manner, too.
Sign the Check
Look on the back of the check for the endorsement line or box. Typically, there will be text indicating "Endorse here". Sign your name in the indicated space exactly as it appears on the "Pay to" line on the front of the check.
Designate the New Recipient
Directly underneath your signature, print "Pay to the order of" and the recipient's full name in clear, legible handwriting.
Give the Check to the New Recipient
Finally, you can hand the check over to the new recipient so that they can try to deposit or cash the check.
Alternatives to Endorsing a Check to Someone Else
Although it's possible to sign over a check to someone else, it may not be the best solution — especially if the new intended recipient's bank doesn't accept third-party checks.
If you have a bank account, you may consider depositing the check at a local branch or ATM or using your bank's mobile app. Processing times for checks vary, but once the funds are deposited in your account, you can then safely withdraw the cash and, if desired, give it to the recipient or write them a new check.
Another possibility is to request a wire transfer of the funds to their account (usually for a fee). Finally, you can use a peer-to-peer money transfer app such as Zelle® to send money to people that you know and trust for free.
If you don't have a bank account, you may still cash the check at a bank for a fee. However, many banks won't cash a check unless you have an account due to the prevalence of fraudulent activity.
There are also retailers and services who might cash a check for a fee. It’s a good idea at all times to understand what their fees will be before enlisting their help.
In addition, if you don't have a bank account, consider applying for one (In fact, we know a great place to do it). Having a checking account is easy and can save you a great deal in both time and check cashing fees.
How To Sign Over a Check: The Bottom Line
Although it's not a very common occurrence, it is possible to endorse a check to someone else. Just make sure that you understand the steps necessary for signing over a third-party check — and ensure that the new recipient's bank will accept the check.
In addition, it's important to know that check-cashing scams involving fraudulent third-party checks have become common.
Typically, these involve being asked to deposit a check for someone else and giving the money to the scammer in the form of cash, a prepaid card, or a wire transfer.
However, once the bad check has bounced, you'll likely be on the hook for repaying your bank the money you withdrew to send to the scammer. If you are the recipient of a third-party check, only cash or deposit it if you know and trust the person who wrote it over to you.
