How Long Can a Bank Hold a Government Check

A government check can be held by a bank for a maximum of 10 business days, but this timeframe can vary depending on the type of check and the bank's policies.

Banks are required to make government checks available to the recipient within 10 business days, as stated in the Expedited Funds Availability Act.

The bank may hold the check for a longer period if it's a large amount, if there are any issues with the check, or if the bank needs more time to verify the check's authenticity.

In some cases, the bank may be able to make the funds available sooner, such as if the check is a direct deposit or if the recipient has a direct deposit account with the bank.

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A deposit hold is a temporary restriction on the use of deposited funds, usually imposed by the bank to protect themselves from potential losses. This hold can last anywhere from one to seven business days.

Banks typically hold deposits for several business days, or even more, after they're received. This allows them to verify the funds and ensure the check doesn't bounce.

The hold is usually intended to protect the bank from losing money if the check is returned unpaid or if there's some other complication. If the check bounces, the bank will have time to fix the problem before you can spend the funds.

Common reasons for placing a hold on a check or deposit include accounts with frequent overdrafts, new customers, high-dollar deposits, and deposits of checks that have already been returned unpaid.

Here are some specific scenarios where a deposit hold might be placed:

In some cases, the bank may be required to make at least the first $225 available to you by the next business day, with the remainder of the funds available by the second business day.

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Your bank's policy is a major factor in determining how quickly a check clears. Each bank and credit union has its own policies and procedures for clearing checks, which can vary.

The day you deposit the check also plays a role. In most cases, banks won't process a check during weekends and holidays, so if you deposit a check on a Saturday, the bank won't begin processing it until Monday or the next business day.

Larger checks may take longer to clear than smaller checks, as banks may place a hold on the funds to ensure they are legitimate. This is because banks want to verify the authenticity of the check before releasing the funds.

The type of check also affects clearance speed. Personal checks typically take longer to clear than certified checks, cashier's checks, and checks from government agencies.

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Your bank's policy plays a significant role in determining how quickly a check clears. Each bank and credit union has its own procedures, which can vary.

Banks typically don't process checks during weekends and holidays. If you deposit a check on a Saturday at an ATM or via mobile deposit, the bank won't begin processing the check until Monday or, if Monday is a holiday, on Tuesday.

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The check's amount can also impact clearance speed. Larger checks may take longer to clear than smaller checks, as banks may place a hold on the funds to ensure they are legitimate.

Banks may have longer holding times if your bank account is new or you've overdrawn on it repeatedly.

Personal checks typically take longer to clear than certified checks, cashier's checks, and checks from government agencies. Checks from the same financial institution also tend to clear faster than checks from a different institution.

Here are some specific hold times to keep in mind:

Your account status can also affect clearance speed. Banks may have longer holding times if your account is new or you've overdrawn on it repeatedly.

Next Business Day Deposits are a great option if you need access to your funds quickly. Most banks make funds available on the business day after you make a deposit.

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However, there are some exceptions. Cash deposits made to a bank employee must be made available within one business day, and those deposits are often available immediately.

Some types of checks must also be available in one business day, including official bank checks like cashier's checks, checks issued by the U.S. Treasury, checks for $200 or less, checks drawn on the same bank that you're depositing to, and USPS money orders.

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

Here are some specific examples of checks that are typically available on the next business day:

These are just a few examples, but it's worth noting that not all checks are created equal. Some types of checks may be held for longer periods of time, depending on the bank's policies and any potential issues with the check.

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Under the Expedited Funds Availability Act (EFAA), banks can place four types of holds on deposited funds, including statutory, large deposit, new account, and exception holds.

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Each type of hold has specific requirements that must be met, and some banks may require funds to be held under the type that allows the largest amount to be held for the longest period.

Statutory holds are allowed under EFAA, but no specific details are provided in the article section examples about their requirements or duration.

Large deposit holds are placed when the total of deposits made in one business day is more than $5,000. This type of hold affects the availability of funds for the third business day after the deposit.

A table summarizing the availability rules for large deposit holds is as follows:

New account holds and exception holds are also allowed under EFAA, but no specific details are provided in the article section examples about their requirements or duration.

Banks can't hold certain types of payments, including cash, electronic payments, direct deposits, money orders, cashier's checks, certified checks, teller's checks, or state or local government checks, as well as the first $5,525 of traditional checks that aren't in question because they're next-day items.

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The Expedited Funds Availability Act (EFAA) was implemented to regulate the hold periods on deposits made to commercial banks, specifically to standardize financial institutions' use of deposit holds.

The EFAA was enacted by the U.S. Congress in 1987, and it specifies the types of holds that banks can utilize on a check deposit, depending on the type of account and the amount of the deposit.

Banks and other financial institutions must inform customers of their policies regarding deposit holds, as well as any changes to the policies, as part of the EFAA's standardization efforts.

The Federal Reserve has implemented the EFAA as Regulation CC, further emphasizing its importance in the banking industry.

The EFAA aims to standardize the handling of deposit holds, which is a key aspect of how long a bank can hold a government check.

Banks can hold deposits for several business days to protect themselves from potential losses.

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The hold is intended to give the bank time to verify the deposit and ensure it's legitimate.

Money from cash or electronic payments, direct deposits, and certain types of checks, like cashier's checks, is not subject to holds.

Banks can't hold the first $5,525 of traditional checks that aren't in question because they're next-day items.

Common reasons for placing a hold on a check or deposit include accounts with frequent overdrafts, new customers, and high-dollar deposits that exceed the total available balance in the account.

Here are some reasons why a bank might hold your deposit: