Joint Endorsement: What It Is, How It Works

What Is Joint Endorsement?

A joint endorsement can be required on a check presented for deposit or cashing that has been made out to two or more individuals. The purpose of the joint endorsement is to prevent one individual from depositing or cashing a check without the knowledge or permission of the other person to whom the check is made out to.

Understanding Joint Endorsement

Rules on joint endorsements vary by state, bank, and even the type of check presented. For example, when checks are made out to a married couple and deposited into their joint account, many banks will not require both spouses to endorse the check; after all, the money is going into an account to which they share access.

On the other hand, most banks will require checks issued by the U.S. government, such as tax refund checks, to be jointly endorsed, even for deposit into a joint account.

The Details Make a Difference

The need for a joint endorsement can be determined by the way the check is written. According to the legal convention, if the two payee names on the check are separated by the word "and" or any symbol or abbreviation of the word "and," then the bank can require a joint endorsement.

Thus a check made out to "Jane Doe and John Doe," "Jane Doe & John Doe," or "Jane Doe + John Doe" would call for a joint endorsement.

On the other hand, if the payee names on the check are separated by a simple comma, such as "Jane Doe, John Doe," then either party could endorse the check. Note that all banks may not follow these conventions and could demand a joint endorsement in any case.

In some instances, both parties for a joint endorsement cannot be present together at the same time to endorse the check.

For example, a recently divorced couple in which one of the partners has obtained a restraining order against the other might present a problem for the bank because it is difficult to verify or ask for signatures for a check. In such cases, a bank works with both parties independently or asks for a reissue of the joint check, made out separately to each individual.

Joint Endorsements in Landlord-Tenant Transactions

The issue of joint endorsements often comes up in landlord-tenant relations because many living situations involve roommates who share bills and responsibilities but who are not married or otherwise related.

When a landlord returns a security deposit to tenants, the check may be written out to both, or all, the tenants listed on the lease, using some version of "and" between the names. Often the letters JT are appended to the names, meaning "joint tenants." A problem arises when two unrelated roommates have separate bank accounts since the landlord's check can only be deposited into one account.

In this case, the refund check must still be jointly endorsed by both tenants before it can be deposited in one of the tenants' bank accounts. The depositor would then presumably write a separate check back to the other tenant.

The Bottom Line

When a check is made out to two or more people, a joint endorsement is required. This ensures that all parties on the check agree to its deposit or cashing. If the names on the check are separated by "and," then a check will usually need a joint endorsement. If they are separated by "or," they usually won't. Joint endorsements are usually needed on shared accounts, such as those between spouses.