No, money orders can never get bounced. However, sometimes money orders get declined if they become invalid.
Are you receiving a money order for the first time? Then you must be wondering, Can Money Orders Bounce?
Although money orders can not bounce. But it can get rejected for a certain number of reasons. So, what are they?
Well, you will find out soon. Because in this post I will answer every possible query related to money orders. So stay with me till the end.
First, let’s find out how money orders work.
How Does Money Order Work?
Like checks money orders, is a form of payment issued by banks and other financial institutions. Here is how it works
1. First, the sender goes to a bank or financial institution and asks for a money order.
2. Then he/she fills in the below information
- His/her name and address
- Date
- Payee’s name and address
- Amount
- Payment Reason
- Signature
3. After filling in the information the sender pays the amount along with a small fee.
4. Lastly, the sender receives the money order and can send it via mail.
Pretty simple, right?
Moreover, a receiver can cash a money order in most banks or even grocery stores. So, do they bounce?
Can Money Orders Bounce?
No, a money order can never bounce in any situation. The receiver can cash it immediately with just a valid ID.
Like bank cheques, money orders are a certificate issued by banks and credit unions. They are almost similar in nature. Because they both are used as a form of payment. However, cheques can get bounced if the benefactor account does not have enough balance.
On the other hand, a money order can never get bounced and it can be cleared almost immediately. But why?
Why Can’t Money Orders Bounce?
Money orders can not get bounced because they are prepaid by the benefactor.
When you receive a cheque, the donor gives you kind of a payment slip, you show it to the bank and the bank cut the mentioned amount from the donor’s bank account. So, cheques are postpaid. As a result, they can get bounced.
However, money orders are totally prepaid. A benefactor can never send you a money order without paying the whole money order amount in advance. So, no matter what happens a money order can never get bounced.
How Can A Money Order Bounce
In any situation, a money order can not bounce. However, if you are told that the money order bounced then it can be a mistake. Because it actually got rejected. Moreover, money orders can become invalid for certain reasons. Lastly, it can be fake that’s why it is rejected.
But how can it get rejected?
Can A Money Order Get Declined?
Yes, a money order can get declined for a few rare cases. Here is why money orders can get declined
- If the money order becomes invalid.
- When the payee fails to provide a valid photo ID.
- In case the payee’s personal detail does not match the money order details.
- Instead of the payee, someone else tries to cash the money order.
What Makes A Money Order Invalid?
A money order becomes invalid if the handwriting is unreadable or damaged or if there are spelling mistakes in the payee details.
Money orders never go out of date. So, if one of your money orders becomes invalid then it’s not expired. But the money order has either one of these
- Unreadable handwriting.
- There is a spelling mistake on the payee’s personal information.
- The money order is damaged to the level that the payee information is not clear.
- The money order is fake.
How Much Does A Money Order Cost?
A money order can cost from $0.25 to $3 depending on the money order amount and the bank or store you are sending it from.
Though money orders are safe and reliable. However, to send one you need to spend a few bucks. Normally, sending a money order can cost between $0.25 to 3 dollars. But it might vary depending on your state. Because in some places a $1000 money order can cost you as high as $5.
Where Can I Cash A Money Order For Free?
You can cash a money order for free from a bank or credit union you have an account. Moreover, USPS money orders are free to cash.
Cashing a money order can cost you a small fee. But if you have a bank account then it can be free. Just go to your bank or credit union and deposit the money order into your account. It won’t cost you any money.
On the other hand, if you don’t have a bank account. Then request a USPS money order. Because they are free to cash at any post office.
Can A Money Order Be Canceled?
Yes, a money order can be canceled anytime if you have the receipt with you.
Money orders can be canceled anytime you want. However, the process can be a bit hectic and might cost you some bucks. To cancel a money order, you can
- Call your money order provider or go to the place you have bought it from.
- Provide them with the money order serial number.
- Then provide the personal details you gave on the money order.
- Pay a small fee and it will be canceled.
In case the receiver has already received the money order and cashed it then it can not be canceled.
Are Money Orders Traceable?
Yes, money orders are traceable if you have the receipt or the serial number of your money order.
In the past money orders were hard to trace. But nowadays it won’t take more than 10 minutes to trace a money order.
However, to trace your money order you need the serial number. Then enter it on the USPS website or MoneyGram website and you will get the status of it. You can even find out if the money order was traced or not.
How Safe Is A Money Order?
Money orders are one of the safest forms of offline payment. They are even safer than cash or cheque.
Money orders are safe, fast, and reliable. As they are pre-paid, a receiver is guaranteed to get paid no matter what the situation is. On the other hand, no one other than the receiver can cash it. So, like cash or cheque if a money order is lost then you don’t need to panic just report it to the bank.
Moreover, money orders can be canceled at any time. So, it’s safe for the sender as well. Lastly, like cheques, it does not get bounced. However, be aware of fake money orders and scammers. It’s one of the disadvantages of money orders.
