Some entities accept debit card payment for money orders, while others do not. You have to decide if it’s worth it.
The easiest way to find out if you can buy a money order with a debit card is to ask. But be warned: if you use your card to make a purchase, you may end up paying more than you expect.
This is because many debit card companies treat money orders as cash advances, which typically carry fees of up to 5% of the transaction amount, along with higher interest rates.
If you want to avoid these additional costs, consider using a different payment method, such as cash, debit card, or traveler’s checks, to purchase your money order.
But before deciding which type of payment is best for you, let’s explore how money orders work and why you might need them.
What is a money order?
First issued by American Express in 1882, a money order is a certificate that allows the recipient – the person who receives it – to cash the money order immediately.
Aside from the fact that both checks and money orders are paper forms of payment, they don’t have much else in common. Money orders cannot bounce – the money used to purchase a money order is guaranteed. Those who buy a money order use cash or another form of payment (such as a traveler’s check) where money can’t bounce. So personal checks and credit cards are not accepted when trying to buy, for example, a Western Union money order.
Financial institutions and governments often issue money orders to transfer money to people who don’t have access to a traditional checking account. However, you can also deposit money orders into a checking account. If you want to open a new account, consider some options below.
Why would anyone pay with a money order?
Even though much of the world is tech-savvy, there are still reasons why money orders and other paper payments can still be useful.
Those who do not have a current account can cash checks without having to become an account holder and navigate the banking world.
Postal orders protect both the payee and the payer. Recipients are guaranteed payment as no one else can steal the check as their details are on it. For the payer, his account number is not in danger of being compromised and would-be thieves cannot immediately use a money order as they would with cash.
To protect against bounced checks after a sale, some transactions in various industries require money orders or cashier’s checks.
That said, money orders can be stolen, lost or destroyed. While you may ask for a replacement, your best option may be to use a money transfer service.
What is needed to cash a money order?
How to cash a money order
Take the payment to a place that cashes checks or money orders. Money orders are treated much like checks.
Endorse the money order as you would a check. Sign your name on the back.
Show valid ID.
Pay the fees for the service.
Get your cash.
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How can I cancel a money order?
If it is not possible to change money orders before they are lost or stolen, it is best to contact the issuer of the money order. Most organizations have procedures for reversing a payment or returning unclaimed money orders.
If you try to cancel a money order after it has been picked up, the issuer (bank or credit union) will not replenish the lost funds. The next step is to request a copy of the signed money order from the financial institution from which the buyer purchased the money order. Then contact law enforcement and allow them to investigate.
What are the advantages and disadvantages of using a debit card to buy a money order?
If you don’t have the money to buy a money order, using your debit card might seem like a simple solution. By simply swiping the card, you could have your money order in minutes. But you may also accrue cash advance fees and interest which may have higher rates than your other credit card debt.
The typical cash advance APR can have a significant impact on a user’s ability to pay the prepayment, especially for those with a history of minimal pre-existing debt repayments.
If you have no choice but to use your debit card, be sure to make your payments on time to avoid late fees and the negative impact late payments can have on your score. credit. And consider making more than the minimum payment to reduce the amount you’ll pay in interest.
at the end i will suggest you that get money order with debit card but make sure you pay money time to time is necessary