If a bank account hold has been placed on some of your funds, you may be wondering why this has happened and what you can do to resolve it.
Let’s look at bank account holds and some common reasons behind them. We’ll also look at some steps you may be able to take to remove them yourself.
What is a bank account hold?
A bank account hold is a temporary delay that prevents you from accessing funds. When this happens, the funds may appear to be available in your account, but you can’t withdraw or access them. Financial institutions may place a hold on your account to protect you and the institution from potential losses due to suspicious account activity.
How long does a bank account hold last?
The length of a hold depends on why it has been placed. For example, while funds from in-person cash deposits typically need to be available by the next business day, full amounts of non-cash deposits, such as checks or online transfers, may be held for up to 5 business days, although this timeframe also often depends on the financial institution.
In other circumstances, like when you’re redepositing a bounced check or depositing funds into a bank account that is less than 30 days old or frequently overdrawn, a bank can hold funds for longer than the typical 5 business days.
According to federal regulations, funds from certain types of checks, including certified bank checks and U.S. treasury checks, must be available in 1 business day. Additionally, in general, the first $275 of any check must be made available for withdrawal or check writing at the start of the next business day after your deposit.
Debit card holds
Sometimes, when you make a purchase using your debit card, your financial institution may place a pre-authorization hold on your account for a specific amount of money. These holds often occur when you use your card to make a purchase, and the final amount of your purchase isn’t known at the time you use your card. These holds are typically lifted within 5 to 7 business days, once your funds have been transferred to the merchant. A pre-authorization hold can help to ensure that you have the funds available to complete the purchase.
Common reasons for account holds
Common reasons you might experience a bank account hold include:
- Opening a new account at a bank or financial institution
- Waiting for a check to clear
- Waiting for a larger deposit or money transfer to clear
- Suspicious activity, such as an especially large purchase or a series of purchases in a different state
- Pending transactions that haven’t officially cleared with your financial institution
Removing a hold
In many cases, a hold will resolve itself after the standard waiting period of up to 5 business days. In other instances, you may have to contact your financial institution to pre-approve what they might believe to be a suspicious purchase or ask them to lift a hold you believe was placed in error.
Depending on the type of fund transfer, you may be able to take steps to reduce the delay time of some bank account holds. For instance, with paychecks, try setting up direct deposits with your employer. For larger checks, you can try receiving them as money orders, certified checks or cashier’s checks. If you’re concerned about debit card holds, you can always try using a credit card to pay for expenses or adding more funds to your checking account ahead of purchases.
Bank account holds and your financial well-being
Holds on your account can be frustrating but knowing how they work and the protection they provide can help you navigate them and give you some peace of mind. If you identify a hold on your account, you can choose to wait for your financial institution to lift the hold or reach out to them to see why there’s a hold and whether they can lift it for you.
Disclosure: This article is for general educational purposes. It is not intended to provide financial advice. It also is not intended to completely describe any Citi product or service. You should refer to the terms and conditions financial institutions provide for various products.
