A check endorsement that transfers ownership to another person is called what?

• A. Blank Endorsement
• B. Restrictive Endorsement
• C. Special Endorsement
• D. Endorsement by receipt

Answer: (C)

Endorsement types control who can claim the funds on a check. A special endorsement is used when you want to transfer ownership to a specific person. It is written as “Pay to the order of [Name]” followed by your signature. This names the new owner and lets that person cash or deposit the check, effectively transferring ownership.

In contrast, a blank endorsement is simply your signature, turning the check into a bearer instrument that anyone who holds it can cash or deposit. A restrictive endorsement adds limits like “for deposit only,” which restricts how the funds can be used and who can receive them. An endorsement by receipt isn’t a standard form for transferring ownership.