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10 Day Hold on Check?’

Question: 
I am wondering if it is against regulations to place a 10-day hold on a check? I always thought we couldn't go past 9 days. Please refresh my memory!
Answer: 

by John Burnett:

Unless the deposit was made in a nonproprietary ATM, the normal duration of an exception hold under the "safe harbor" limits in section 229.13(h) would make the funds available by the later of opening of business or 9:00 a.m. local time on the seventh business day after the banking day of deposit. If the deposit was made Monday of week 1 and there are no intervening federal holidays, funds would be released on the morning of Wednesday of week 2.

A "new account" hold on the excess amount over $5,525 of "next-day" checks to a new account can be released on the 9th business day after the banking day of deposit. There is no restriction on "new account" holds on deposits of other (non next-day) checks.

The last sentence in section 229.13(h)(4) adds some flexibility to the "safe harbor" hold limits. It reads, "A longer extension may be reasonable, but the bank has the burden of so establishing." That allows a bank to place a longer exception hold, but the bank would have to have, and document, a good reason for doing so.

Answer: 

by Brian Crow

The only time period that extends beyond seven business days is the new account exception in 229.13(a) which allows holds to be placed on the amount above $5,525 for next day items (as described in 229.10(c)(i) through (v) which may be held up to the ninth business day under the safe harbor limits.

First published on 09/19/2021

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