counter draft, bankers draft

debrag

Are counter drafts the same thing as bankers drafts?

We are moving house next week and need to pay the rest of the money to the agent. we can pay in cash or bankers draft but bankers draft is prefered, it's £1600 to pay.

I'm with Natwest who do bankers drafts but charge £12, my partner is with Nationwide who do counter drafts and don't charge (I think).

ironlady2022

Just ask, a Banker's draft just guarantees the cheque will not bounce, that is what you are paying for. Some banks charge some do not!

dunstonh

Are counter drafts the same thing as bankers drafts?

They are normally referred to as counter cheques. Not counter drafts. No, they are not the same thing. Counter cheques can be stopped. Drafts cannot (except in very rare circumstances).

Some years back in our area, there were a number of businesses that got caught out by stolen Nationwide counter cheques who complained they shouldn't have bounced. They didn't realise that they didn't carry the same guarantee that a draft does. CHAPS payments are the most common method used with house purchase money transfers.

Mikeyorks

Bankers Drafts / Bank Counter Cheques / Building Society Cheques ....... are all different terminologies for essentially the same thing. Which is a basic cheque but issued by the Bank or Building Society on their funds.

They all share the same criteria that they cannot be stopped and are therefore 'guaranteed' funds ......... unless stolen / lost or fraudulently used :-

http://www.chequeandcredit.co.uk/faqs/-/page/what_is_a_bankers%27_draft/

http://www.chequeandcredit.co.uk/faqs/-/page/are_bankers%E2%80%99_drafts_and_building_society_cheques_as_good_as_cash_how_do_they_work/

jonesMUFCforever

Mikeyorks wrote: »

Bankers Drafts / Bank Counter Cheques / Building Society Cheques ....... are all different terminologies for essentially the same thing. Which is a basic cheque but issued by the Bank or Building Society on their funds.

They all share the same criteria that they cannot be stopped and are therefore 'guaranteed' funds ......... unless stolen / lost or fraudulently used :-


How do you tell if you are given a cheque whether it is stolen or fraudentially issued?
The only way is to present it through the clearing system and wait.
This is why CHAPS is the preferred way for most same day transactions where the beneficiary can be sure of instant cleared funds.

Mikeyorks

jonesMUFCforever wrote: »

This is why CHAPS is the preferred way for most same day transactions where the beneficiary can be sure of instant cleared funds.

But ...... it isn't an option the OPs letting agent has offered.

And if you want to know if a Bankers Draft / Bank Counter Cheque / Building Society Cheque is legitimate ..... you specially present it. Then you will generally know the following working day whether it will be met. Worth the circa £12 as these will tend to be higher value cheques.

JuicyJesus

Mikeyorks wrote: »

Bankers Drafts / Bank Counter Cheques / Building Society Cheques ....... are all different terminologies for essentially the same thing. Which is a basic cheque but issued by the Bank or Building Society on their funds.

They all share the same criteria that they cannot be stopped and are therefore 'guaranteed' funds ......... unless stolen / lost or fraudulently used :-

Totally wrong; see dunstonh's post. Counter cheques can be stopped, drafts can't.

Mikeyorks

JuicyJesus wrote: »

Counter cheques can be stopped, drafts can't.

Totally wrong. Read the links I posted. In particular read what I actually said.

Drafts can be stopped under precisely the same criteria as Bank cheques ......... ie lost / stolen / fraudulent.

dunstonh

My information may be out of date but when i was in banking the counter cheques were processed uncleared and the drafts were processed cleared. This was not a manual adjustment but the waste machines themselves recognising the drafts. Also, when we issued cheques we gave the choice of a managers cheque (counter cheque) or a draft. The managers cheque could be stopped if required. The Draft could not (bar some rare exclusions).

I can see the links Mikeyorks posted and they back up what he says. So, I can only assume that something has changed since I left banking or that the info on that site is playing it safe rather than going into technical differences.

Mikeyorks

I think it's the interpretation of 'stopped'? As I said in post #4 :

They all share the same criteria that they cannot be stopped

...... meaning the drawer can't stop them - as it's not the drawer's cheque, as all are drawn on Bank / Building Society funds. But all types can be stopped by the issuer if the original owner of the funds provides proof of loss or being stolen. And, of course, the issuer will unceremoniously stop (ie decline to honour) them if they prove to be fraudulent.

In that respect there's no difference between Drafts / counter cheques.