6109 Shares

My question was: How can banks continue to hold funds and earn interest on checks that have already cleared?

My question was: How can banks continue to hold funds and earn interest on checks that have already cleared? Topic: How to write a check if there is no change
June 24, 2019 / By Hilary
Question: With computerized banking, checks clear the "clearing house" within 24 hours.There are two definitions:1) Local (a check written in a state) 2) Non-Local (a check written out of state). For a Non-Local check, the FRB says the bank can hold up to 5 business days. My check was posted to BB&T 9-4-07. It cleared Suntrust Bank 9-5-07. In neither account was my money available to me. BB&T released the hold on 9-10-07. They earned interest on my money while charging me fees on checks coming in--they had my money. It is wrong. It is double dipping. Banks have many ways of making money at their customers' expense--too many to name here. Banks make millions--and they are tricky. Please don't act like an authority or be a smart-aleck on something when you don't know the answer. I asked the question wanting people to THINK. Is it right for a bank to continue to hold funds for 6 more interest-making days when they have the funds? No. The FRB should stipulate so and stop it now.
Best Answer

Best Answers: My question was: How can banks continue to hold funds and earn interest on checks that have already cleared?

Eavan Eavan | 7 days ago
It is not "right." The law sets out the maximum time they can hold a check, there is no minimum. Not all banks hold your checks for the maximum time period. My bank makes funds available as soon as possible. If your bank is holding your checks for too long, change banks. Find one that makes funds available as soon as possible. I have never had a check held for more than 2 or 3 days. Good luck.
👍 102 | 👎 7
Did you like the answer? My question was: How can banks continue to hold funds and earn interest on checks that have already cleared? Share with your friends

We found more questions related to the topic: How to write a check if there is no change


Eavan Originally Answered: Does it matter when you decide to buy index funds for long-term hold?
Index funds in many cases can beat managed funds, but there are managers with a long term record that can beat the index. You just have to find them in the over 7,000 funds that are out there. Are we at or near a market top? Who knows? Want to buy my crystal ball? Suggest you keep buying in the dollar cost average and buy extra on the large dips. Here are the symbols of a few outstanding funds. YAFFX OSFDX PRNHX BRUFX ARTKX Check them out on Morningstar quote box.
Eavan Originally Answered: Does it matter when you decide to buy index funds for long-term hold?
the long term trend for the market is up, so it's very hard to predict when and if the price will be lower. That said, the market since the year 2000 has been essentially sideways (with some big ups and downs, obviously), so you might want to ease into the market slowly. If the price drops, you'll still have some cash to invest. The points you make about the market being high now, and liable to fall, are quite correct. One strategy, if you're investing in ETF index funds, is to use call options to hedge your bets. Buy some calls that are just slightly "out of money" for a small price (buy them on a "down" day for the best price). If the market rises, you've locked in a good price. If the market falls, you lose the price of the options (which is small), but you still have your capital to invest, and you'll have a better sense of where the market is heading. Re: dollar-cost averaging. This is a good strategy if you're investing with a steady income from your job or whatever. If you have a given cash sum to invest, then it's a different issue, and there's no point in not being fully invested unless you think the market is overvalued, or you're afraid of a correction or bear market. Right now, I'm not seeing any indications for a bear market in the next few years. The issue is how robust our recovery is, and whether the run-up since the year began is sustainable.
Eavan Originally Answered: Does it matter when you decide to buy index funds for long-term hold?
very few actively controlled funds beat the long term universal of the S&P over a 10 3 hundred and sixty 5 days era or on account that inception. do no longer inspect the a million 3 hundred and sixty 5 days and 3 3 hundred and sixty 5 days returns. placed funds right into a passive index and occationally placed income individual shares which you have confidence will beat the index.

Chance Chance
That is why you are suppose to write checks with an "available" balance. Unless its direct deposit or cash there is a hold. Use this as a learning tool and make sure what you have in your account before writing a check. This is once again an example of YOU not taking responsibility for your actions. The bank is a processing center they are not your private bankers that service costs extra...
👍 30 | 👎 3

Chance Originally Answered: Why banks in some countries offer high interest rates?
The proper name for your idea is "carry trade". It has been fairly common in Japan (which has had near zero rates for 15+ years) to invest in Australia and New Zealand. Investing in a bank in India carries substantial costs and risks. - Commission+spread to convert your money from dollars to rupees. - Indian bank deposits are not covered by FDIC insurance. - Indian taxes on non-resident. - US taxes overseas earnings in most cases. - Commission+spread to convert from rupees back to dollars. The exchange rate will be different, perhaps far worse for you. Summary: not recommended.
Chance Originally Answered: Why banks in some countries offer high interest rates?
Because money in foreign anks comes with greater risk. What happens when that foreign bank fails and you lose your money. In the US, we have the FDIC, which insures deposits (up to a limit). Also, people generally see the US currency as the most stable. Banks offer higher interest rates the riskier they are.

If you have your own answer to the question how to write a check if there is no change, then you can write your own version, using the form below for an extended answer.