My local bank just sent a letter: Availability of deposits will be delayed.

[dixiegrrrrl]

The bank is rated 2( poor ) out of 5 (good) stars.
We have banked there for almost 20 years.Their rating of course was much better back then.

Here is the letter:

"Effective Feb. 27th, the Funds Availability Policy will change.
In some cases ( not explained what those cases are) we may delay your ability to withdraw funds beyond the day of deposit. The fund will generally be available by the 2nd business day after the day of deposit.
LONGER DELAYS MAY APPLY IN SPECIAL CIRCUMSTANCES ( Emphasis mine).
We will notify you if your funds will be delayed".

I called the bank. They said if the deposit availability is delayed they will tell me at time of deposit. ( I get Soc. Sec.)
They also said the reason they "might" delay checks is because the Federal Bank Clearinghouses
have all been closed except for ONE.
HUH??????


There are NO 5 star banks in this small town.

I am looking at this letter in light of the fact Money Market funds and Citibank have also changed their availability policy.

Whatcha think?

[rox63]

1. Are there any banks with more than 2 stars in your town?

Or any credit unions?

[dixiegrrrrl]

2. I am checking ..no pun intended..on other banks in town.

Last time I did this, there were only 3 or less star banks here.
No credit union within 100 miles.
We are really rural.

[Newsjock]

3. The same notice is going out elsewhere

The claim is that the new holding period is shorter in some cases. Also, this appears to apply only to deposited paper checks.

Here are two examples:
http://www.starcreditunion.com/page/funds-availability-policy-change-notice.php

We have changed our funds availability policy. This notice describes the changes to that policy. The changes are beneficial to you and are already in effect. Our previous policy provided that in some cases we could delay the availability of checks you deposit for a longer period than we ordinarily would. Our previous policy also provided that in some circumstances (which are described below) we could delay the availability of checks you deposit for an even longer period. Our new policy reduces the possible length of those hold periods to two days and seven days, respectively.

http://bmiweb.bmifcu.org/images/stories/pdf_docs/RegCC%20online%20version.pdf

The Federal Reserve Board has finalized efforts to consolidate check
processing sites due to the significant decline in the volume of paper check
processing. As a result, funds from certain check deposits will be subject to a
faster availability schedule.

[dixiegrrrrl]

4. Ahhhhh... thank you for that info.

It sounds like good not bad news.
But....
when it comes to banks now days, ya never know.

[LiberalArkie]

5. It is paper checks.. I have that happen to me with paper payroll and even

U S Treasury checks, mine were always 10 days. Electronic does not have the delay

[dixiegrrrrl]

6. Soc. Sec. checks are Treasury checks.

Are you saying those type were "always" delayed 10 days?

Ours here never were.

Hmmm..I wonder if this is a way to "encourage" electronic banking?

[westerebus]

7. From my Credit Union.

$100 will be available the day after deposit of a locally drawn check, the balance three days from deposit. They reserve the right to withhold funds the CU believes the check will not be made good.

Not good is defined as a check from a company in receivership, a personal party currently filed for bankruptcy, or a state of emergency exists in the locality the check originated from.

Just what are they so concerned about? This is Virginia BTW.

[dixiegrrrrl]

8. "or a state of emergency exists in the locality the check originated from." ??!!??

Is that definition in the actual letter they sent you?

What the hell are they expecting???

[westerebus]

9. Yes.

The Credit Union is in the south western part of the state which has been job poor for decades. Picture the Waltons. Not that much has changed there.