What is an Availability Schedule
The availability schedule refers to the number of days it takes for a third-party check deposited into a customer's checking account to become available to the customer. While the funds are unavailable until cleared, they are referred to as checks held.
BREAKING DOWN Availability Schedule
The maximum number of days that funds can be held by banks is dictated by the Expedited Funds Availability Act (EFAA), which was enacted by Congress in 1987 and subsequently became a Federal Reserve regulation. Its purpose was to regularize the hold periods commercial banks could place on deposits, and to regulate financial institutions’ use of such holds. It is also called Regulation CC, for the Federal Reserve regulation that puts the EFAA into practice.
Types of Deposit Holds Banks May Use
Regulation CC names four types of deposit holds available to banks. They are:
- Statutory hold, which can be placed on any deposit;
- Large deposit, which can be placed on deposits greater than $5,000, or an aggregate of deposits made in one business day whose total is greater than $5,000;
- New account, which can be placed on deposits to an account that has been open for 30 days or fewer; and
- Exception holds, which are used when an account has been overdrawn for a certain number of days during the previous six months; when the depository bank has good reason to think the check won’t clear; when the instrument being deposited is an image replacement document (IRD) of a previously returned instrument; or when an item is accepted for deposit during a banking computer failure or power outage.
The EFAA originally distinguished between local and non-local check deposits, but with the passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act in 2010, this distinction was eliminated.
The Funds Availability Schedule
Regulation CC establishes maximum hold periods banks are allowed to implement, although many banks make funds available before the maximum number of days has elapsed. The funds availability schedule is as follows:
- For statutory holds, $200 of the deposit must be made available the first business day after the deposit; $600 the second business day; and the rest on the third business day.
- For large deposits, $200 of the deposit must be made available the first business day after the deposit; $600 the second business day; $4,800 the third business day, and the rest on the seventh business day.
- For new account holds, funds must be made available no later than the ninth business day after deposit.
- For exception holds, funds must be made available no later than the seventh business day after the deposit.