A balance hold on your bank account can prevent you from getting to your money. The money is there, but you can't use it until the bank releases the hold. To get a balance hold released, you must know why the bank initiated it. It might be a routine matter of waiting for a check to clear, or the bank might be exercising its right of set-off. This is a bank's right to apply your account balance toward a loan debt, for example. Find out what prompted the action and follow the bank's direction to get access to your funds.
Contact the Bank
Contact the bank and determine why the hold is in place. Banks have to follow the government’s guidelines on how long to hold check deposits. If it's a matter of following the law, there is little you can do. If the hold exists for another reason, such as collateral for a loan, it can be released, assuming you meet the bank’s conditions.
Ask how long it will take for the hold to be released once you comply with the bank’s terms. You should know if the money will be available immediately or if you'll have to wait, especially if your need for the funds is pressing.
Repair the Issue
Take the necessary steps to meet the bank’s requirements. For example, if the hold is securing a loan, pay the loan in full to get the money released. If the bank stopped the check for suspicious activity, provide documentation to show that its source and use are legitimate.
Follow up with the bank to confirm that the hold has been released and the funds are available. If the hold remains, ask to speak with a manager. Find out if you missed some steps in complying with the bank's directions. If so, address them as soon as possible. If you’ve done everything that’s required, the manager should release the hold immediately.
While some holds are mandated by federal law, others are a matter of bank policy. Under the 1987 Expedited Funds Availability Act, the government outlined requirements for banks to reduce hold times. Treasury and cashier's checks should be available by the next business day, but local checks should be available within two business days. Nonlocal checks have five days to clear.
That said, these are maximums, not minimums. You may find that your bank's practice of putting holds on accounts is too strict for your purposes. If that's the case, begin searching around for a bank with policies that align with yours. Just be aware that often banks put these measures in place to protect their accountholders, so you may be giving up an important security feature.
- Citizens Bank: Learn How Your Checking Account Works
- Federal Reserve: Regulations
- 30 Holding Account synonyms - Other Words for Holding Account
- Federal Reserve System. "Check Services." Accessed Feb. 4, 2020.
- Federal Deposit Insurance Corporation. "Expedited Funds Availability Act," Page 6. Accessed Feb. 4, 2020.
- The Federal Reserve Board. "A Guide to Regulation CC Compliance." Accessed Feb. 4, 2020.
- Office of the Law Revision Counsel of the United States House of Representatives. "12 USC Ch. 41: Expedited Funds Availability." Accessed Feb. 4, 2020.
- Consumer Financial Protection Bureau. "How Quickly Can I Get Money After I Deposit Check Into My Checking Account? What is a Deposit Hold?" Accessed Feb. 4, 2020.
- Federal Reserve Board. "Examples of Applying Funds Availability Rules." Accessed Feb. 4, 2020.
- Federal Deposit Insurance Corporation. "FDIC Law, Regulations, Related Acts: 6500 Consumer Protection." Accessed Feb. 4, 2020.
- Office of the Comptroller of the Currency. "Answers About Funds Availability: Direct Deposit." Accessed Fed. 4, 2020.
- Office of the Comptroller of Currency. "Answers About Funds Availability: Cashiers Checks." Accessed Feb. 4, 2020.
- While some holds are mandated by federal law, others are a matter of bank policy. If you find that your bank’s procedures are too strict for your purposes, consider finding a bank with less restrictive account hold guidelines.
Carl Carabelli has been writing in various capacities for more than 15 years. He has utilized his creative writing skills to enhance his other ventures such as financial analysis, copywriting and contributing various articles and opinion pieces. Carabelli earned a bachelor's degree in communications from Seton Hall and has worked in banking, notably commercial lending, since 2001.