Get Banking Basics: How Do Money Orders Work, Anyway? - The ...

Key Takeaways A money order is a secure way to send money or make a payment — up to $1,000. Many recipients prefer money orders because, unlike a personal check, a money order can't “bounce” and clears almost immediately; therefore, they provide a fast, risk-free form of payment.

Key Takeaways A money order is a secure way to send money or make a payment — up to $1,000. Many recipients prefer money orders because, unlike a personal check, a money order can't “bounce” and clears almost immediately; therefore, they provide a fast, risk-free form of payment.

If the order is deposited into a bank account, it may take a couple days for the funds to become available.

10 The clearing process can take a few weeks, even if your bank's funds availability policy allows you to use the money immediately. If you use the funds and the money order turns out to be , the bank will require you to repay the amount.

A money order is a paper document, similar to a check, used as a form of payment. Typically, it's purchased by prepaying the amount printed on the face of the money order with cash or another form of guaranteed funds.

The Downsides of Money Orders They're not always a convenient form of payment. Money orders must be purchased in person. They have a purchase maximum. ... They come with fees attached. ... They're commonly used in scams.

Money orders are a safe form of payment that can be used as an alternative to a check or cash. These paper documents offer guaranteed funds, but unlike a check, they are prepaid and aren't tied to a bank account.

A money order is a certificate, usually issued by a government or banking institution, that allows the stated payee to receive cash on demand. A money order functions much like a check, in that the person who purchased the money order may stop payment.