How Long Can a Bank Hold a Check By Law?

When depositing a check into your bank account, you may have noticed your available funds can differ from account’s actual balance. This happens because your bank or credit union has placed a hold on your check deposit.

Financial institutions do this to protect themselves. A hold is placed to make sure the check is not returned due to insufficient funds, forgery, closed accounts, or a stop payment. It typically takes a few business days for your bank to receive the funds from a deposited check.

In 1987, The Expedited Funds Availability Act was passed by the U.S. Congress to address the issue of how long financial institutions can legally hold your deposit before giving you access to your money. Financial institutions must also make their hold policies available to all their account holders and they must provide that information when someone opens a new account.

In 2003, Congress passed the Check Clearing for the 21st Century Act (Check 21) to help speed up the process and allow banks to transfer checks electronically. This allowed the Reserve Banks to reduce their number of paper check-processing offices from 45 in 2003 to just 1 in 2010. The result is that all checks are now considered “local” and can be processed quicker. This means decreased wait times for the depositor.

By law, a bank can hold a check for a maximum of 9 business days before you can withdraw the money. For most situations, your check deposit will be held for a maximum of 3 business days. The exact hold time depends on several circumstances, which we will now cover.


What Is a Check Hold?

A check hold is a temporary restriction placed on the funds from a check that has been deposited into an account. When a bank places a hold on a check, it means that the funds from the check will not be immediately available to the account holder. The funds will remain on hold until the hold is lifted by the bank. This means that the account holder will not be able to access the funds from the check until the hold is released.


How Long Banks Can Hold Checks of $5,000 and Less

For check deposits totaling less than $5000 in a day, the bank must make $200 available to you the next business day. The second business day, $600 must be available to you. The rest of the deposit must be available by the 3rd business day. Your bank or credit union’s check holding rules may differ, as these are the maximum times the law allows. For example, the policy of Wells Fargo, Bank of America, and Chase is to make 100% of most check’s funds available by the next business day.


How Long Banks Can Hold Large Checks by Law

If the total check deposits into one account on the same business day is over $5000, then $200 must available on the first business day, $600 on the second, $4800 on the 3rd, and the remainder must be available on the 7th business day.


Expedited Availability for Checks with Lower Risk

For some deposits, banks are required make the first $5000 available in one business day. Checks issued by the Federal Government, by the U.S. Treasury (such as social security or tax refunds), by any state, city, county, or other municipality, checks from the same bank you are depositing into, certified checks and cashier’s checks, USPS money orders, and checks under $200 must have the first $5000 available the next business day.


Check Holds for Newly Opened Accounts

When depositing into a new bank account, open less than 30 days, the bank is allowed to hold checks for up to 9 days before making any funds available to you.


High Risk Exceptions

There are some exceptions to the general rules. If you have a history of Non-Sufficient Funds (NSF) problems associated with your account or if the bank has a legitimate reason to doubt the check you are depositing is good (such as suspected fraud, or the issuing bank says the check will not clear), then your entire check can be held up to 7 days. Financial institutions also may hold postdated checks (checks with a future date), “stale-dated” checks (checks dated 6+ months in the past), and checks which they assume will not be honored for reasons such as insufficient funds available.


Direct Deposit, ACH, and Wire Transfer

Funds from non-check, non-cash deposits are generally made available for withdraw the same day. This applies to electronic payments like direct deposits, Automated Clearing House (ACH) payments, and wire transfers. However, some banks and credit unions may have different policies or procedures that could affect the availability of the funds. For example, some banks may hold ACH funds for a longer period of time if the transaction is for a large amount or if there are unusual patterns of activity on the account.


How Long Banks Can Hold Cash Deposits

Cash deposits given to a bank teller are usually available immediately. However, banks are allowed to hold cash deposits for a maximum of 1 business day.

Whether it’s Chase, Capital One, or a small local bank, there are a few reasons why a bank may place a hold on a check. Some common reasons for check holds include:

  • Large check amount: If the check is for a large amount, the bank may place a hold on the funds to ensure that the check will clear and the funds will be available.
  • Unusual activity: If the bank detects unusual activity on the account, such as a high number of checks being deposited or withdrawn, it may place a hold on the funds to protect against potential fraud.
  • Account issues: If there are problems with the account, such as an overdraft or a past due balance, the bank may place a check on hold until the issues are resolved.
  • Insufficient funds: If the check writer’s account does not have enough money to cover the check, the bank may place a hold on the funds until additional funds are deposited.
  • Check-clearing process: The bank may place a hold on the check while it is being processed and cleared through the check-clearing system.

To find out the specific reason for the hold and what you can do to resolve the issue, you should contact your bank or credit union.


Can a Bank Hold a Check if the Account Has Insufficient Funds?

Yes, a bank may hold a check if the account has insufficient funds. When a check is deposited, the bank may place a hold on the funds to ensure that there are enough funds in the account to cover the check and prevent overdrafts or other issues. If the account does not have sufficient funds when the check is presented for payment, the bank may refuse to process the check or return it to the account holder.


Can a Bank Hold a Check Forever?

It is generally not possible for a bank to hold a check forever. Banks are required to follow certain rules and regulations when it comes to clearing checks. In most cases, a bank must make funds from a deposited check available to the customer within a certain number of days, depending on the type of check and the bank’s policies.


How Can I Get a Bank to Release It’s Hold on a Check?

If a bank is holding a check that you have deposited, there are a few steps you can take to get them to release the funds:

  1. Contact the bank or credit union to find out the reason for the hold. There may be a problem with the check or with your account that needs to be resolved before the funds can be released.
  2. Review the terms and conditions of your account to see if there is any info about check-holding policies. This may help you understand the reason for the hold and what you can do to release the hold.
  3. Follow any instructions provided by the bank to resolve the issue. For example, the bank may ask you to provide additional information or documentation, such as proof of identity.
  4. If you are unable to resolve the issue with the bank, you may want to contact your state’s Consumer Protection Agency, submit a complaint with the Consumer Financial Protection Bureau or seek legal advice. If a bank is holding a check for an unreasonable amount of time or is not following its own policies and procedures, you may have grounds for a complaint.

7 Responses

  1. Steve MacDonald

    Filed my taxes thru TurboTax, received a refund check in the form of a cashier’s check drawn on an Ohio bank, and deposited it to my Chase checking account. Chase placed an eleven day hold on the funds. There’s no arguing with the people in the branch; they can only do what their computer s tell them to do. What’s my next move? I thought about contacting my US Senator, but I live in AZ and Kirsten Sinema is as useless as a dead goldfish.

  2. Michelle Antioquia

    I deposited a check from contracting job and chase bank has had it more than 20 days they waited till today to advise me that even though the check has cleared they are still holding my check for verifacation. Can they do that the check was already paid in full

  3. Jenna

    Same situation – plus they closed my account . following this post??

  4. Sajid

    Chase is terrible, I deposited a check and they told me the 7 day hold will be released on the 9th, and now I’m looking online and they have extended it to the 13th, with zero available now, been a customer with them for over 20 years , never NSF, or any other special circumstances, clearly these banks are making money out of my money.

    • Jesse

      Yes they are messing with me in the same way and I went in, no one can tell me why or give any further information. There is no reason and no notes in the system, plus I have deposited checks from that same account many times.
      Maybe they are using out money to invest in low stocks since the market is down?

  5. Larissa

    Same situation here with chase. 7,000 check and they put a hold on it for 10 days. Said needed verification and needed to physically recieve the funds. Which they have both. They did a conference call with the issuing bank and verified the check. The funds were physically received yesterday (which they lied ab) they’ve made 0$ available. The hold department put in a request to remove the hold, said I would see the funds available in 20 min, and if not someone would call me asking for more info. No funds, no call, and I called back and they said “the back office” denied the request. I asked to speak w the “back office” they said they don’t take phone calls. I asked to speak with a supervisor and he said there’s nothing they can do they won’t release them. I don’t understand. Did anyone find a solution for this?

  6. Stacey

    My credit union has a check I deposited for large amount in “collection”. Today is past the 30 days from when they sent to “collection”. Originally deposited Nov 8, 2023. Filed a complaint with CFPB which was escalated to FDIC. FDIC sent acknowledgment letter to bank on Dec 5. The bank has 21 days to respond. About to go to the bank and speak to CEO/President. Any one have any other suggestions?

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