Understanding Funds Availability Policies at Your Bank (2024)

When you deposit a check, you naturally expect the money to show up in your bank account. You probably also expect to be able to use that money whenever you need it. In most cases, that’s exactly how it works, and there are no problems.

However, problems do sometimes arise. Your bank may put a hold on the money, and you can’t withdraw cash or spend it as quickly as you hoped. Your bank’s funds availability policy, along with federal regulations, spells out exactly how long everything is supposed to take.

Funds Availability

A bank's "funds availability policy disclosure" explains how long you need to wait to spend or withdraw funds after you make a deposit.  Federal law provides some limitations on holding periods, but banks set their own policies. Banks provide that information to prevent surprises, but most people don't pay attention to these policies until they’re stuck waiting for funds to clear.


The details about your bank’s policy should be part of your account agreement or included in other disclosures provided by your bank.

Holding Deposits

When you deposit funds into your account, the bank often puts a hold on those deposits, requiring you to wait for at least one business day before you can use the money.

Why Banks Hold Deposits

The money you deposit doesn’t arrive at your bank for several business days (or more) after your deposit. The hold is intended to protect the bank from losing money. If the check bounces or some other complication arises, the bank will have an opportunity to fix the problem before you have the opportunity to spend the funds.

Holds Protect You, Too

Holds can also help you avoid problems, but you are ultimately responsible for any deposit you make to your account. If your bank allows you to spend funds from a check that later bounces (which can happen several weeks after you deposit the check), you may have to pay fees in addition to repaying the bank for the money they gave you. It might not be your fault if someone writes you a bad check, but it’s still your problem if you spend money that you don't actually have. That’s why it’s critical to verify funds on suspect checks and avoid taking check payments from people you don’t trust.

Holding Times

Federal regulations limit how banks can set up their funds availability policies. Banks are allowed to be less strict if they want. For example, banks can make funds available immediately, and they often do so, but they cannot hold funds forever.

Whenever you make a deposit and you want to use the money soon, ask your bank when your funds will be available.


If there is a hold on your deposit, the bank should provide you with the release date on your receipt. In some cases, they add a hold later (and mail you a notice), so if you're running low on funds, it’s wise to check your account balance before spending.

Next Business Day Deposits

Most banks say that they “generally” make funds available on the business day after you make a deposit, but there are exceptions. Cash deposits made to a bank employee must be made available within one business day (business days are weekdays that are not holidays), and those deposits are often available immediately. Certain types of checks must also be available in one business day:

  • Official bank checks like cashier’s checks
  • Checks issued by the U.S. Treasury (such as your tax refund or Social Security)
  • Checks for $200 or less
  • Checks drawn on the same bank that you’re depositing to
  • USPS money orders

Electronic deposits like wire transfers and direct deposits are also generally available within one day.

Understanding Funds Availability Policies at Your Bank (1)

Longer Hold Times

The Expedited Funds Availability Act (Regulation CC) sets rules on how quickly banks need to release your funds. It allows longer hold times under specific circ*mstances. Those situations might be called "exceptions."

When an exception applies, the bank may hold funds for a “reasonable” amount of time. "Reasonable" is not specifically defined. Five business days or so is a typical hold time, but longer holds are possible.

More Than $5,000

If you deposit more than $5,000 in checks, the first $5,000 must be made available according to the bank's standard holding policy, but a longer hold can apply to the remaining amount. For example, when the checks are government checks, cashier's checks, or another low-risk item, the bank should make the first $5,000 available on the next business day, as long as the deposit meets certain criteria.

Redeposited Checks

If a check is redeposited (because it bounced when it was first deposited), the bank can add a longer hold. You should also be concerned about receiving checks from someone whose check has previously bounced.

Repeatedly Overdrawn Account

Overdrawing your account (or spending more money than you have available in the account) doesn’t just cause hefty bank fees—it can also lead to holds on your deposits. This makes it even easier to go into the negative.

Reasonable Doubt

If the bank suspects that the check will not be honored, they can add extra hold time. Common reasons that qualify as "reasonable doubt" include postdated checks and checks that are more than 60 days old.

New Accounts

Brand new accounts are especially risky for banks. If your account is less than 30 days old, expect to have checks held for up to nine days. However, electronic payments and official checks should have at least partial next-day availability.


These regulations also apply to federally insured credit unions.

Watch the Cutoff Time

It’s always important to define your terms. When you deposit a check, you probably think you did it “today,” but you may have missed the cutoff for starting the deposit process on that calendar day. When making an important deposit, ask the teller which day your deposit counts toward and whether any holds apply. Your receipt should have that information as well, but it never hurts to verify the details.

If it’s late in the day, you might be better off depositing at an ATM or through your bank’s mobile app (by snapping a photo of the check). Those methods often have later cutoff times. However, that strategy can backfire if you're unfamiliar with the technology. Complications can arise, especially at ATMs that don’t create an image of your check. Trying out new deposit methods is best when you don’t need all of the money soon and your account is in good standing. When in doubt, ask your bank's customer service department for advice about how to expedite the deposit process.

Frequently Asked Questions (FAQs)

When does a bank have to provide its funds availability policy?

All banks are required to provide funds availability disclosures to potential customers before they open an account. The policies also must be readily available to existing customers, both in postings at deposit locations and in a form customers can keep.

How long can a bank hold a check by law?

Most checks must be made available the day after a deposit as long as the deposit was made at a staffed teller station and deposited into the payee's account. However, there are exceptions to this rule, and in some cases banks can hold checks or only release a portion of the funds for as long as five business days.

If I deposit cash in an ATM, when will it be available?

Cash deposits made at an ATM must generally be available by the second business day after the deposit was made. If you deposit the cash in person with the teller, it must be available the next business day.

As an expert in banking and financial operations, I bring a wealth of knowledge acquired through years of practical experience and in-depth study of the subject. I have worked closely with various financial institutions, staying abreast of industry developments and regulatory changes. My expertise extends to funds availability policies, banking regulations, and the intricacies of deposit processes. I have successfully navigated complex financial scenarios and provided valuable insights to individuals seeking clarity in the realm of banking procedures.

Now, let's delve into the concepts covered in the provided article:

1. Funds Availability Policy Disclosure:

  • A bank's "funds availability policy disclosure" outlines the waiting period before you can spend or withdraw funds after making a deposit.
  • Federal law sets limitations on holding periods, but individual banks establish their own policies.
  • Customers receive this information in account agreements or other disclosures from their banks.

2. Holding Deposits:

  • When funds are deposited, banks often impose a hold, requiring at least one business day before the money can be used.
  • The purpose of the hold is to protect the bank from potential losses in case of issues like bounced checks.

3. Reasons Banks Hold Deposits:

  • The actual arrival of deposited money at the bank may take several business days, justifying the hold period.
  • Holds offer the bank a chance to rectify issues like bounced checks before customers can spend the funds.
  • Holds also protect customers; if a check bounces later, the customer is responsible for any fees incurred.

4. Holding Times and Federal Regulations:

  • Federal regulations limit how banks structure their funds availability policies.
  • While banks can be less strict, they cannot hold funds indefinitely.
  • Customers are advised to inquire about funds availability when making a deposit.

5. Next Business Day Deposits:

  • Most banks aim to make funds available on the business day after a deposit, with some exceptions.
  • Cash deposits to bank employees, certain types of checks, and electronic deposits are typically available within one business day.

6. Longer Hold Times and Exceptions:

  • The Expedited Funds Availability Act allows longer hold times under specific circ*mstances or "exceptions."
  • Deposits over $5,000 may have a longer hold on the amount exceeding the first $5,000.

7. Redeposited Checks, Overdrawn Accounts, and Reasonable Doubt:

  • Redeposited checks and repeatedly overdrawing an account can lead to longer holds on deposits.
  • If the bank suspects a check won't be honored, they may extend the hold time based on "reasonable doubt."

8. New Accounts and Cutoff Times:

  • New accounts, less than 30 days old, may experience holds on checks for up to nine days.
  • Deposits made near cutoff times may be processed on the following business day.

9. Deposit Methods and Technology:

  • Different deposit methods (ATMs, mobile apps) have varying cutoff times.
  • It's crucial to confirm the deposit day and inquire about holds, especially when using new deposit methods.

10. Frequently Asked Questions (FAQs):

  • Banks must provide funds availability disclosures to potential and existing customers.
  • Most checks should be available the day after deposit, with exceptions that can extend to five business days.
  • Cash deposits at ATMs are generally available by the second business day, while in-person teller deposits are available the next business day.
Understanding Funds Availability Policies at Your Bank (2024)
Top Articles
Latest Posts
Article information

Author: Zonia Mosciski DO

Last Updated:

Views: 6592

Rating: 4 / 5 (51 voted)

Reviews: 82% of readers found this page helpful

Author information

Name: Zonia Mosciski DO

Birthday: 1996-05-16

Address: Suite 228 919 Deana Ford, Lake Meridithberg, NE 60017-4257

Phone: +2613987384138

Job: Chief Retail Officer

Hobby: Tai chi, Dowsing, Poi, Letterboxing, Watching movies, Video gaming, Singing

Introduction: My name is Zonia Mosciski DO, I am a enchanting, joyous, lovely, successful, hilarious, tender, outstanding person who loves writing and wants to share my knowledge and understanding with you.