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Local Bank - Availability of Funds Delay, Large Check?
Old 11-17-2018, 09:58 AM   #1
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Local Bank - Availability of Funds Delay, Large Check?

We don't need the money quickly, but I was a little surprised when depositing a large Cashiers Check (6 figures) from another bank yesterday WRT availability of funds. The full amount won't be available for 12 days That seems unnecessarily long? I might understand a personal check or if we'd ever had account issues, but for a Cashiers Check from a Bank?

11/16 Deposit (afternoon)
11/19 $200
11/20 $4800
11/28 $xxx,xxx.xx

I guess it works out to 6 business days with a late day deposit, weekends and a holiday. Bad timing on our part.

I had to talk to an actual banker with a big cushy office to make the deposit and discuss a subsequent wire transfer. I've used the banks online customer portal for years (to transfer dividends out, view transactions), and it was clear she didn't know ANYTHING about their customer online portal. She had to call someone to answer my online service questions.

They won't be our bank much longer so not worth a fuss, I was just surprised at how backward smaller local banks can be. Large amounts clear much faster at global banks, brokerages, even online banks...
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Old 11-17-2018, 10:08 AM   #2
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There is a lot of fraud with cashiers checks and wire transfers these days. Banks are increasingly cautious in accepting and making deposits available.
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Old 11-17-2018, 10:10 AM   #3
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There is a lot of fraud with cashiers checks and wire transfers these days. Banks are increasingly cautious in accepting and making deposits available.
+1.

Just because it says "Cashiers Check" on the face, how is your bank supposed to know that for certain? They are protecting you by requiring a delay.

To avoid this, use a wire or ETF. Those include an electronic 'handshake' to the originating bank, so they have confirmed the funds and are fully committed.

You might, might have been able to have your bank call the other bank to confirm? I don't know if that works.

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Old 11-17-2018, 10:14 AM   #4
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I think anything that involves "cash" for a decent amount might raise a flag.

I know, a bummer since it is your money, who the heck should care? But we live in a guilty until proven innocent society .
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Old 11-17-2018, 10:15 AM   #5
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+1.

Just because it says "Cashiers Check" on the face, how is your bank supposed to know that for certain? They are protecting you by requiring a delay.

To avoid this, use a wire or ETF.

-ERD50
To the first part fair enough.

To the second - long story but the originating TX bank wouldn't do one large wire transfer unless I appeared in person (1200 miles away). Remotely my choices were pay $22 for each $5K wired or take a cashiers check (worked out to over $1600 to wire it all). And I will wire transfer the full amount to the final account for $20 - after it clears 12 11 days from now...

And I transferred a similar amount from Chase to our online bank two weeks ago from my home PC in my (figurative) bathrobe and fuzzy slippers without delay, without talking to a human - at $0 charge.

So I guess I'm comparing a fresh virtually identical experience working with Chase vs local banks.

Again, local banks. Again, we'll wait.
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Old 11-17-2018, 10:17 AM   #6
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There is a lot of fraud with cashiers checks and wire transfers these days. Banks are increasingly cautious in accepting and making deposits available.
This makes a lot of sense. I guess I'd rather my bank be cautious then having money which I did not withdraw disappearing from my accounts.
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Old 11-17-2018, 10:21 AM   #7
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I have banked for many years at one of the largest banks in US.

I had a check (USD) from my foreign account, it took over 30 days to get the money in my account.
It was not just a hold on it, they actually sent the check to the other bank to be verified.
It cost me $100 for that "service". Both banks charged me to verify the check.

Now I only deposit up to $3,000 per check so I don't trip their rules.
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Old 11-17-2018, 10:22 AM   #8
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To the first part fair enough.

To the second - long story but the originating bank wouldn't do one large wire transfer unless I appeared in person (1200 miles away), or paid $22 for each $5K wired so I had to take a cashiers check. And I will wire transfer the full amount to the final account for $20 - after it clears 12 11 days from now.
Well, in that case you are stuck with the delay. But that delay really is there to protect against fraud. The words "Cashier Check" on a piece of paper don't create any sort of magic security against fraud.

Would the originating bank make out the check to your final account? That would avoid one delay. I suspect they would want that in person as well though, but maybe not if it is titled the same as the name they have for you?

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Old 11-17-2018, 10:27 AM   #9
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Originally Posted by ERD50 View Post
Well, in that case you are stuck with the delay. But that delay really is there to protect against fraud. The words "Cashier Check" on a piece of paper don't create any sort of magic security against fraud.

Would the originating bank make out the check to your final account? That would avoid one delay. I suspect they would want that in person as well though, but maybe not if it is titled the same as the name they have for you?

-ERD50
Of course I explored all my options. I can assure you the way I've gone was the only way short of spending $1600+ for wire transfers or $400-500 for plane fare - which seemed ridiculous.
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Old 11-17-2018, 10:27 AM   #10
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This is one of the reasons I like having free wire transfers via Ameritrade. (Although they have called me on the phone to verify in two cases: Once when doing a large transfer - almost 6 figures, and once when I initiated to outgoing transfers about 30 minutes apart.)
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Old 11-17-2018, 10:39 AM   #11
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I've made some pretty large 6 digit cashier check deposits at my local "hick town" bank and the funds have always been available "no later than the next day". It's never been a problem. Now I have been with this bank a long time and I do carry enough of a balance in my accounts to cover the deposit. Maybe that makes a difference.
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Old 11-17-2018, 10:52 AM   #12
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I closed out a credit union account, went across the street to the other credit union with the check, and got the same story (about 2 weeks). Also got the third degree asking me if I knew the party issuing the check. Yep, it was me. I know me.

Doesn't matter. He explained all the fraud and for our protection, blah, blah.

Funds were credited, just not available.
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Old 11-17-2018, 11:21 AM   #13
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I've made some pretty large 6 digit cashier check deposits at my local "hick town" bank and the funds have always been available "no later than the next day". It's never been a problem. Now I have been with this bank a long time and I do carry enough of a balance in my accounts to cover the deposit. Maybe that makes a difference.
Absolutely makes a difference. I had to explain this to my son when he was depositing his 2 and 3 figure paychecks from his high school part time job.

If you have $100 in the account, and deposit a $40 check, and withdraw $40, you appear to have "cashed the check" w/o delay. But you really made a $40 withdraw from the $100, and have $60 available, and will have $100 available after the check clears. If you had $20 in the account, they would not let you draw $40 until that check cleared.

If you tried to take the account near zero, I doubt they would let you until the deposit cleared. Unless the deposit came from the same bank - they may treat that as a transfer, they 'own' the funds either way.

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Old 11-17-2018, 11:42 AM   #14
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We refinanced for cash with Chase long ago and deposited the Chase cashier’s check into our Chase checking account after the closing. The funds weren’t available for two weeks because Chase suspected fraud.
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Old 11-17-2018, 11:44 AM   #15
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That’s a real pain. Unfortunately cashiers check fraud is common. When I sold a vehicle I went to the buyers bank with him to get the cashiers check.
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Old 11-17-2018, 12:11 PM   #16
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I'm not surprised at all.

When I recently opened an account at CapOne 360 to take advantage of their $500 bonus they listed a 5-day delay on the initial transfer and when I called they confirmed that and added that every subsequent incoming transfer would be held for 4 days before it would be available. That seems so strange to me given the electronic connections financial institutions have.

Glad I have other options.
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Old 11-17-2018, 12:14 PM   #17
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These days there is even fraud with bank to bank transfers, so banks are super cautious handing out the $$$.
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Old 11-17-2018, 02:43 PM   #18
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We just had this same issue with DiscoverBank but this was with their Mobile Deposit.

A few days after the upload $200 was available, then 2 days after that another $4800, then 5 days after that, the balance.
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Old 11-17-2018, 03:33 PM   #19
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Money laundering is another concern. There are gummint rules but following them is not a safe harbor. The feds will fine a bank if they suspect money laundering, so all banks are paranoid.

Depositing a check followed by an immediate wire transfer is an additional red flag.

Finally, banks are increasingly trying to help prevent scams perpetrated on elders. In this bank's case that may have been the reason for the interview.

None of what happened is any reflection on you. The bank is just following its rules, though you are free to consider them to be excessive.
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Old 11-17-2018, 04:22 PM   #20
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I have had to deposit some large checks in the last several months and done in across a local bank, a credit union, and an online bank. The local bank was the fastest to clear the funds, 2 business days. The credit union was the longest, 7 business days (they did make a small amount of it available within a business day). The online bank was 3-4 business days.

Since I did not have an immediate use/need for money the delays were no big deal. I understand they can technically clear them faster, but these days I can accept erring on the side of caution for fraud protection purposes.
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