Types of Negotiable Instruments Endorsements Unit B Business Law Objective 6.01 Types of Negotiable Instruments

Endorsements Signature on the back of a negotiable instrument Allow payee to cash, deposit or transfer payment of the check to someone else Proof that the payee cashed or transferred payment of the check to someone else Endorser is responsible for payment of the check if the new owner cannot collect payment Endorse should sign the check the way it is on the front of the check and if the name is misspelled, correct the signature directly up under the first endorsement

DO NOT WRITE BELOW THIS LINE Blank Endorsements Signed with endorser’s name only Can be cashed by anyone who has a check with a blank endorsement X Jane Doe DO NOT WRITE BELOW THIS LINE

Special Or Full Endorsements Transfer payment to someone else Can make a payment on a debt with this endorsement Payee signs the check over to another person to receive payment X Pay to the order of Jane Doe John Doe DO NOT WRITE BELOW THIS LINE

Restrictive Endorsements Limits use of check Safest type of endorsement Can not be cashed by someone who has stolen the check Safest way to send a check through the mail X For Deposit Only DO NOT WRITE BELOW THIS LINE