Treasurer's Draft

A Treasurer’s draft is just a fancy name for a cashier’s check. (See: Cashier’s check.)

Treasurer’s drafts and cashier’s checks are bank drafts. Basically, they're checks drawn from a bank’s own funds. Treasurer’s drafts are considered a guaranteed means of payment...very legit. You won’t have to worry about it bouncing, like you potentially could if you got a check from a flaky friend. Why? Because it’s the bank writing it, so it’s the bank taking on responsibility for the draft’s payment. If you get a cashier’s check or treasurer’s draft, the bank withdraws money from your account and deposits it into its own account.

The other reason people use and like treasurer’s drafts is that only the payee whose name is written on the draft can cash it in. It’s generally considered a secure way to transfer money, since the bank is a legit middleman...great for large, formal transactions.

However, treasurer’s drafts aren’t immune to fraud. Because they can clear fairly quickly, someone can deposit a fraudulent draft and cash it in before the bank notices that the draft doesn’t match up with any withdrawn funds to their account. That’s why there’s usually a hold put on treasurer's drafts over $5k.