Canadian Postal money orders are not well known to US sellers. Here are some facts.
Canadian Postal orders in US funds (pink ones) are as good as cash when redeemed at any US. Post Office. There is no charge for cashing them at the Post Office but if you try to cash them at your bank, a fee may be charged. Some sellers have told me that their bank has tried to charge them up to $12 for cashing a foreign check. This misses the whole point of a money order. The money orders are guaranteed by the Canadian Post office.
For Canadian buyers of US money orders the Postal Money order from Canada Post is the least expensive option. At $4.95 CDN it is less expensive than the typical $6 to $8 bank charge. The maximum amount that can be sent is $999.99 but if you need to send more you could buy two, but now a bank order would be less expensive. If you send a CDN postal money order to a US seller I urge you to put a note on it that says 'cashable at the US Post Office for no charge' this will save a headache later if they try to cash it at the bank and their bank charges them a fee and then they complain to you. I have had no trouble since starting to put a note on the money order. Before trying the notes about 1 in 5 would try to cash it at their bank. If you buy something really cheap, under $20, you may consider sending well concealed cash to a trusted seller, it is still $4.95 per money order even if you send 10 cents. If you send cash, round up to the next dollar as people can feel change in an envelope.
Canada Post offers postal money orders for the UK and other countries as well, although for a slightly higher fee, $6 max.
Postal money orders to Canada in Canadian dollars are $3.95, prices as of August 2006.
The service guarantee offers free replacement of lost or destroyed money orders and/or photocopies of paid money orders upon enquiry from the purchaser.