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  ABSENCE OF ENDORSEMENT STAMP?

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Author Topic:   ABSENCE OF ENDORSEMENT STAMP?
Jadegrneyes
unregistered
posted 03-22-2001 07:22 PM           Edit/Delete Message
Does anyone know when an "Absence of Endorsement Guarantee" stamp can and can't be used? I was under the impression it can only be used when a check is being deposited to a deposit account as long as the account title was exactly the same. I would appreciate someone's help on this. Also, if this is in writing somewhere, please tell me where. Thanks for your help!!

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Barb Hurst
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Posts: 4
Registered: Dec 2001

posted 12-16-2001 08:13 PM     Click Here to See the Profile for Barb Hurst   Click Here to Email Barb Hurst     Edit/Delete Message
The stamp usually reads, "Credited to the account of within named payee. Prior endorsements guaranteed" or something similar. It can be used: 1) when the check is made payable to a single payee and the account title is the same as the payee. 2) when the check is made payable to a single payee and the account is jointly held, as long as one of the names on the account is that of the payee. 3) when the title of the account is EXACTLY the same as the payee. For instance, if the check is payable to William AND Barbara, and the account is titled "William AND Barbara" and takes both signatures to draw a check, then you can stamp the check with the guarantee. However, if the check is payable to William AND Barbara and the account is titled "William OR Barbara", you cannot stamp it with the guarantee stamp. And you should not accept the check for deposit into such an "or" account. The items most often made payable with the "and" are usually insurance checks or IRS tax refunds. If you are doing electronic tax filing, both parties sign off for the electronic credit. That's not a problem. Our problem arises when one of the parties arrives with the jointly payable check and there is only one endorsement on it. It requires both endorsements, even if being deposited into a joint account, if the joint account only requires one signature to withdraw.

[This message has been edited by Barb Hurst (edited 12-17-2001).]

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Don Narup
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Posts: 59
Registered: Jul 2001

posted 12-17-2001 01:24 PM     Click Here to See the Profile for Don Narup   Click Here to Email Don Narup     Edit/Delete Message
If I am reading this correctly the question is regarding an Endorsement Guarantee which is different from an endorsement.

An Endorsement Guarantee is an added endorsement which the bank places after the required endorsement and guarantees that the endorsement is valid. Besides guaranteeing the endorsement,it may have additional verbage requesting the payee bank to issue a cashiers check payable to your bank. A bank officer also signes the guarantee.

This allows a person to take it to the bank it is payable on, and negoiate it. With this guarantee the payee bank is guaranteed that the check is properly endorsed and the guarantee bank accepts the liablility that funds are being given to the correct payee.

This is done in cases where a check is made payable to a business and has been returned NSF. With the guarantee of endorsement your customer can take the check to the other bank and exchange it for a cashiers check, rather than keep sending it through transit. It says that the person presenting the check is authorized to do business on behalf of the company the check is made payable to. By physically presenting the item they are ahead of any items coming through transit that day.

Or, the check is made payable to an individual and you do not want to give immediate credit for the amount of the check. Your customer can take it to the other bank and exchange it for a cashiers check which you would give them immediate credit on.

With the guarantee, all the payee bank has to be concerned with is that the funds to pay the check are available.

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