Check Hold Information: What You Need to Know

June 7th, 2024Check hold information


When you deposit a check, it’s important to understand the rules your bank or credit union has in place for when you’ll have access to those funds. While each financial institution may have its own policies, federal law sets limits on the maximum amount of time that a check can be held.

Why Are Check Holds Placed?

Check holds are designed to ensure there is enough time for the check to be paid by the issuing bank or credit union. This is a protective measure to prevent the funds from being used before the check has actually cleared. However, these legally mandated hold periods are sometimes not long enough, and a check might still be returned unpaid even after the hold is lifted.

Important Points to Remember:

  1. Hold Release Does Not Equal Payment: Just because a check hold has been released does not mean the check has been paid. The funds may be available in your accounts, but the check can still bounce if the other financial institution does not honor it.
  2. Wait If in Doubt: If you have any concerns about the legitimacy or solvency of the check, it’s wise to wait beyond the hold period before using the funds. This can help protect you from potential financial liability.
  3. Beware of Pressure: Be cautious is someone, especially the person who gave you the check, is pressuring you to give them the money immediately. This could be a red flag that the check might not clear, and they are trying to secure the funds before the check is returned unpaid.
  4. Your Responsibility: Remember, if the check is returned unpaid, you are responsible for repaying the amount to your financial institution. This remains true even if you have already withdrawn the funds or given them to someone else.

By understanding these points and exercising caution, you can better manage your check deposits and avoid potential financial pitfalls. If you ever have questions or concerns about a specific check or hold policy, don’t hesitate to reach out to MidWest America Federal Credit Union for assistance.