CHECK INDORSEMENTS BLANK INDORSEMENT BLANK INDORSEMENT The simplest
CHECK INDORSEMENTS
BLANK INDORSEMENT
BLANK INDORSEMENT The simplest kind of indorsement Only contains a signature of the indorser and there are no additional words or language It is sufficient to have the indorser’s signature to cash or to deposit a check It becomes a risky instrument because in the case of theft or loss, the check can be cashed by any person
SPECIAL INDORSEMENT
SPECIAL INDORSEMENT Consists not only of a signature of the indorser but also words indicating to whom, or in whose order, the check is payable (i. e. , indorsee) Becomes tricky if the credit union does not know the original indorser (can’t check relationship to indorsee or signature)
RESTRICTIVE INDORSEMENT
RESTRICTIVE INDORSEMENT Besides a signature of the indorser, has information about how to negotiate a check For example, Marry Smith signs a check made payable to her order as “For Deposit to Account No. 12345678. ” This indorsement will only allow depositing this check into the named bank account Safer than a blank endorsement Credit union must follow the restriction (a check indorsed as “for deposit only” can not be cashed)
CONDITIONAL INDORSEMENT
CONDITIONAL INDORSEMENT Besides a signature of the indorser, has information about an action that has to be done to negotiate this check For instance, a condition such as “Payable to … (Indorsee’s Name) after the building is constructed” means that the indorsee will receive his/her money only after this condition is fulfilled This type of indorsement is not typically accepted by financial institutions because of impossibility to verify performance of the condition
QUALIFIED INDORSEMENT
QUALIFIED INDORSEMENT Relieves the indorser from the liability of making a check good if the check maker defaults on it Wording "Without Recourse" (along with the indorser’s signature) on the back of a check prevents it from returning to the indorser for any reasons This type of indorsement is not accepted by financial institutions because of the limitation of the indorser’s liability
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