Tired of waiting for your deposits to clear? Posted by Gail at 10/31/06 06:59 PM

It has been two years since the start of the federal “Check 21” law and consumers are waiting for check hold times to be reduced. In fact, we’ve had the same long hold times for local and nonlocal checks since 1990! Your bank, savings and loan, or credit union can make you wait through a hold time lasting until the second day for a local check, and the fifth day for a nonlocal check – and weekends don’t count toward these time periods. The Federal Reserve Board has an obligation to reduce check hold times when check processing speeds up, and they are doing a study of check processing speeds right now. Today, six national consumer groups called on the Fed to make sure that study covers all the questions needed to follow the study with a change in regulations to reduce check holds: http://www.consumersunion.org/pdf/checkholdFRB.pdf

Tell Consumers Union about your experience with check holds at: www.consumersunion.org/finance/checkholdSYS.htm, or by filing a comment here. Protect yourself, don’t include private information like your account number in your comment.

comments (5)

1 Posted by PJS at 11/12/06 05:46 AM

Last year, I sent my son a cashier's check drawn on my bank in an account that is in his name and my name. He had an emergency and would need the money in seven days. When my son deposited this cashier's check in his account at his local credit union, he was told that because it was drawn on an out-of-state bank, there would be a 3 day hold on it. When he questioned the validity of this hold on a cashier's check, he was told that it was standard procedure for an out-of-state item. He checked his available balance 5 days later and the hold was still on the check. He called, and was told that they were still waiting for the check to clear. These were business days, not calendar days, by the way. My son went back to his credit union and asked for the check back, he would take it somewhere else. They would not give it to him. After a 14 day hold, they finally released the funds. I had to Western Union my son the funds he needed to replace the cashier's check that his bank held. He did need the funds in 7 days, which is the reason for the cashier's check. His credit union had no apology, and when he closed his account there, no remorse when he told them why.

2 Posted by Anon at 11/29/06 02:28 AM

A 14 day hold seems outrageous, but I hear this from friends and family all the time. How can they get away with this?

3 Posted by Steve Fletcher at 12/18/06 11:48 AM

So when the bank holds your check for, say, 5 days as policy, and it clears in 2, who gets the interest on the money for the 3 days? My bank said that it didn't matter how long it took to clear, their policy was to hold funds from my account for 5 days regardless.

4 Posted by Tiffany at 02/03/07 11:00 PM

how will i be informed that a cashiers check has cleared?

5 Posted by Lynn at 01/25/08 02:12 PM

I've banked at the same location for about nine years. In that time, it's been three different names. First, it was Commercial Federal, than First Federal, and now Bank of the West. I never had a problem with deposit holds until BOTW took over. Last month, I deposited a check on Friday, just after 5 p.m., but after the "cut-off". I wrote a check on Sunday. The check hit my account Monday morning, but the deposit wasn't posted until Tuesday, with an additional $33 charge for the privilege. Is there a bank out there that doesn't steal from it's customers? I'm really not happy, but if this is standard operating procedure, it's not worth the hassle of changing banks and opening new checking accounts.