Banjo Hangout Logo
Banjo Hangout Logo

Premier Sponsors

281
Banjo Lovers Online


Feb 15, 2024 - 6:27:09 PM
likes this

Bill Rogers (Moderator)

USA

27867 posts since 6/25/2005

Maybe someone more versed than I in arcane banking practices can help explain. I deposited a check today—high 5 figures—from a local business. Business check drawn on a local bank. My credit union put a 12-day hold(!) on the funds. I know there has to be some verification hold time. But 12 days seems ridiculous given the speed of today’s electronic banking. I know my checks (including big ones) go through in a couple of days at the most. How long can it possibly take to verify the funds behind the check, withdraw them and forward them to my bank? No one at the branch level seems to have an explanation. This is not 1955.

Edited by - Bill Rogers on 02/15/2024 18:28:35

Feb 15, 2024 - 6:51:53 PM

3322 posts since 5/2/2012

A head scratcher for sure. Transferring funds between accounts in my bank online site as soon as I press a key. Paying by Paypal or Cash App...seconds. Transferring funds in a personal account in one bank to a personal account in another bank....4 or 5 days. The first time I understood, but after that?

Feb 15, 2024 - 6:55:16 PM

donc

Canada

7417 posts since 2/9/2010

Is it automatically a 12 day hold or do they mean it could take 12 days ?

Feb 15, 2024 - 8:16:56 PM
likes this

Bill Rogers (Moderator)

USA

27867 posts since 6/25/2005

quote:
Originally posted by donc

Is it automatically a 12 day hold or do they mean it could take 12 days ?


They mean a 12-day hold. And of course they don't train the clerks to be able to explain it. They don't steal your interest; that gets paid from date of deposit, but you can't use the money. You could if you did a wire transfer, but that costs. So why is the wire transfer instantly safe, but not an internet transfer via the clearinghouse? It also may be because my institution is a credit union. They want to act like banks, but haven't figured out how to do it, though they have some regulator-imposed limitations. Much of what banks and credit unions do though, seems to me still stuck in the 20th century.      @donc

Feb 15, 2024 - 9:51:31 PM

donc

Canada

7417 posts since 2/9/2010

There are 34 banking companies in Canada and 2 central credit unions [representing several regional credit unions] but the top 5 [Chartered Banks] probably control 95% of the cash flow. I've learned in recent years that many U.S communities have independent banks which may be wholly owned by 1 person or 1 family. I could see that being a can of worms if hundreds of different banks in California were to go through 1 clearing house in L.A.. Cheque writing [notice the Canadian spelling] is rapidly decreasing between individuals.

Feb 16, 2024 - 4:02:54 AM

40805 posts since 3/5/2008

It is ...not...your money...
As you have gave it to..them..

 

Them..cousins to..."They"..

Edited by - STUD figmo Al on 02/16/2024 04:08:51

Feb 16, 2024 - 4:36:12 AM
Players Union Member

Texasbanjo (Moderator)

USA

29956 posts since 8/3/2003

I wonder if it's a check for quite a bit of money if the bank/credit union has a rule that checks of a certain amount have to be held for "X" number of days to be sure it's legit??? If it's drawn on a well-known company, I see no reason to hold it for 12 days, but who knows what/how banking execs think.

Feb 16, 2024 - 5:55:52 AM

Buddur

USA

3850 posts since 10/23/2004

They need their 12 days of interest to make their cut from the transaction.

Feb 16, 2024 - 6:22:12 AM

csrat

USA

1520 posts since 9/14/2008

Get a different banking institution.

Feb 16, 2024 - 6:50:38 AM

986 posts since 2/11/2019

Have you escalated this within the management at the cu?

I had a similar situation back when we first started the business over 20 years ago. Got a big check from a customer just in the nick of time to meet payroll. The clerk told me the money wouldn't post for a few days and I had a knee jerk outburst reaction. The only time I ever saw the screen go blank at the drive through. Meanwhile my wife was on the phone with our account manager. They quickly changed their mind and made our money available for payroll.

Feb 16, 2024 - 7:05:57 AM
likes this

8549 posts since 9/5/2006

my credit union is a 3 day hold on personal out of state checks,,, but thats about it... most everything now is electronic deposit.   and my regular bank has the same practice.

that kind of strange they say 12 days....

Edited by - 1935tb-11 on 02/16/2024 07:07:08

Feb 16, 2024 - 7:09:58 AM

14931 posts since 1/15/2005

quote:
Originally posted by Bill Rogers

Maybe someone more versed than I in arcane banking practices can help explain. I deposited a check today—high 5 figures—from a local business. Business check drawn on a local bank. My credit union put a 12-day hold(!) on the funds. I know there has to be some verification hold time. But 12 days seems ridiculous given the speed of today’s electronic banking. I know my checks (including big ones) go through in a couple of days at the most. How long can it possibly take to verify the funds behind the check, withdraw them and forward them to my bank? No one at the branch level seems to have an explanation. This is not 1955.


I recently got a check from a contractor that I was doing a design/build project with and he asked me to hold it for about the same length of time you mentioned.  It was because he had deposited a very large check from our client who happens to be a billionaire and my contractor's bank balance was not as much as the check he deposited.  Therefore, if that check had bounced, he would have not had sufficient funds in his account to cover the check.  I agree though, that it should not take 12 days with the electronic systems that they have in place.

Feb 16, 2024 - 7:13:15 AM

14931 posts since 1/15/2005

quote:
Originally posted by Bill Rogers
quote:
Originally posted by donc

Is it automatically a 12 day hold or do they mean it could take 12 days ?


They mean a 12-day hold. And of course they don't train the clerks to be able to explain it. They don't steal your interest; that gets paid from date of deposit, but you can't use the money. You could if you did a wire transfer, but that costs. So why is the wire transfer instantly safe, but not an internet transfer via the clearinghouse? It also may be because my institution is a credit union. They want to act like banks, but haven't figured out how to do it, though they have some regulator-imposed limitations. Much of what banks and credit unions do though, seems to me still stuck in the 20th century.      @donc


Bill .... banks complain about credit unions all the time because they are not held to the same rules and regulations as banks.  I would think that it is because credit unions have much more leeway on all sorts of transactions than banks do.

Feb 16, 2024 - 7:27:47 AM
likes this
Players Union Member

rinemb

USA

16141 posts since 5/24/2005

Hmmm, they may have on hold hundreds of thousands of dollars every day, or Millions? perhaps. Invest that in short term paper, for an old term, and make a lot of money each on the "holds". I am not saying they are doing that, but I was around a lot of corporations back in my warrior days, that did that. Brad

Feb 16, 2024 - 8:25:13 AM
likes this

4979 posts since 9/12/2016

nothing new bill -I seldom write checks but i used to cuss bank regularly-- you could deposit cash and it took the machine 3 days to find it--but take some out It knows it right then and there---

Feb 16, 2024 - 9:26:50 AM

mander

USA

5143 posts since 10/7/2007

The length of "hold" often depends on the relationship between the banks/credit unions, the amount and tradition. Here in my town, some checks clear instantly; other checks can take a week or more. It has been my observation, a deposit coming from a bank that has a poor history of creditability with my credit union has a longer hold period. One such bank folded a few years back. I'm thinking the bank must have reigned on large amounts previously.

Feb 16, 2024 - 10:43:47 AM

Bill Rogers (Moderator)

USA

27867 posts since 6/25/2005

I suspect it’s because, as the posts indicate, there is no uniform standard for check holds and other financial transactions. If the bankers wanted (and I include credit unions here) they could set up electronic clearing that would work quite quickly. Checking for sufficient funds should be almost instantaneous. Are the funds there? Does the signature match? (Do they even check that?) That should be enough. But the system lacks both the equipment and software to do that, and won’t spend the money to acquire it. They also are wedded to inflexible policies and methods. In the case of my deposit, a simple local phone call would handle it. But that approach went out years ago. Oh well. In the end, I’ll probably move my account.

Feb 16, 2024 - 11:08:06 AM

149 posts since 4/4/2010

The Patriot Act changed banking - most especially if the amount is >$10,000.

Once you cross 10,000, the the bank is required by law to notify several Federal agencies. They have to clear the transaction, hence the holds.

Moving to another bank or credit union will not change a thing - in fact, all activity in accounts that regularly have transactions above 10K is monitored closely. I am capable of telling you more, but I am not allowed to. These changes were made to both track and control money laundering and terrorist activities. Suddenly changing banks will send up another red flag that will most likely lead to longer holds.

PS the holds will get longer if you regularly make deposits or withdrawals of 10,000 or more.

Feb 16, 2024 - 11:09:55 AM

2165 posts since 2/10/2003
Online Now

quote:
Originally posted by Bill Rogers

I suspect it’s because, as the posts indicate, there is no uniform standard for check holds and other financial transactions. If the bankers wanted (and I include credit unions here) they could set up electronic clearing that would work quite quickly. Checking for sufficient funds should be almost instantaneous. Are the funds there? Does the signature match? (Do they even check that?) That should be enough. But the system lacks both the equipment and software to do that, and won’t spend the money to acquire it. They also are wedded to inflexible policies and methods. In the case of my deposit, a simple local phone call would handle it. But that approach went out years ago. Oh well. In the end, I’ll probably move my account.


They won’t invest in anything that has to do with checks.  There is entirely too much that can go wrong with what is essentially writing down and signing what you promise to pay on a insecure piece of paper. Checks are on the way out and it is being encouraged by the banks implementing policies like check holds, checking account fees, etc. 

Feb 16, 2024 - 3:23:11 PM

14931 posts since 1/15/2005

quote:
Originally posted by PickleWurst

The Patriot Act changed banking - most especially if the amount is >$10,000.

Once you cross 10,000, the the bank is required by law to notify several Federal agencies. They have to clear the transaction, hence the holds.

Moving to another bank or credit union will not change a thing - in fact, all activity in accounts that regularly have transactions above 10K is monitored closely. I am capable of telling you more, but I am not allowed to. These changes were made to both track and control money laundering and terrorist activities. Suddenly changing banks will send up another red flag that will most likely lead to longer holds.

PS the holds will get longer if you regularly make deposits or withdrawals of 10,000 or more.


I routinely deposit checks much greater than $10,000 and have never had one put on hold.  I can do anything with the money as soon as I deposit it (or at least the next day).  That is because I always have more money in the account than the check I am depositing.  I recently deposited a pretty large amount of cash that I had been saving in my safe deposit box at the bank.  I had saved the cash because the interest on savings had not been diddly squat and I wanted enough cash for emergencies, etc. I had to sign a form when I made the deposit and a week or so later someone from the bank called and wanted to know where I got the money.  My answer was "from my safe deposit box" and that seemed to suit her.  I guess the Homeland Security folks wanted to know! 

Edited by - BanjoLink on 02/16/2024 15:30:02

Feb 16, 2024 - 4:03:33 PM

1633 posts since 11/10/2022

I flip houses and deposit very large checks often. My bank gives me 25% immediately and 3 day holds the rest. I only use reputable escrow companies that use mainstream banks. Otherwise its a 10 day wait. The 7 figure homes require 30 days.

Im never sure why either but fraud does happen somehow, sometimes two weeks after the deposit the check is found to be no good....or so i hear.

Feb 16, 2024 - 4:19:52 PM

Owen

Canada

14819 posts since 6/5/2011
Online Now

Maybe not specifically applicable to banking, but sometimes, "Because I/we/they can." is reason (?) enough.  

Terms of Use | Privacy Policy | Privacy Consent
Copyright 2024 Banjo Hangout. All Rights Reserved.





Hangout Network Help

View All Topics  |  View Categories

0.34375