If you read the deposit agreement you signed, you will see that the bank agrees to give you access to the funds days in advance of the check actually being processed and "cleared" through the ACH (automated clearing house). If you are youth challenged like I am, you can remember the days when paper checks actually traveled through the Federal Reserve system back to the issuing bank. If the check was no good, then the check reversed course and arrived back at your bank 7 to 10 business days later. Since that was possible, Banks did not clear checks for days to weeks. The length of time depended upon how far away the issuing bank was. As technology improved, banks and regulators responded by only sending images through the ACH and by providing access to funds (generally) the next business day. If you want to be cautious, you can impose your own hold period and never use funds until 7 to 10 days after you deposit the check or the bank shows an ACH deposit. The very large multinational company that I worked for in Delaware used an obscure bank in Wyoming for payroll accounts until near the end of the 1980s. They knew that the check would not clear for 5 (?) business days and they earned money on the float until then.
Your bank does not actually say that the check you deposit is good on the next business day, they merely give you early access to the funds. If you don't believe me, either read the fine print in the deposit agreement or ask the next time you do a CSR shop at a bank. Just be careful to use the right terminology.
@shopper8 wrote:
The bank should only clear a check after it has been deposited into the account it was written from. I don't understand why the bank states the check is good when it is not. Tellers have no way of knowing a good check from a bad check.
Shopping Southeast Pennsylvania, Delaware above the canal, and South Jersey since 2008