Funds Availability Disclosure

November, 1996

Dear Member:

In 1987, Congress passed the "Expedited Funds Availability Act." This act provides exact time frames and circumstances under which financial institutions are required to make funds deposited by share draft or check to a member/customer's share draft, checking or similar type of account available for withdrawal. (Funds availability also applies to share accounts if you have a draft account.) In addition, this legislation mandates that financial institutions inform you of their individual policies.

Some financial institutions delay availability on most of the deposits they receive. Others only hold under certain circumstances in order to protect the depositor. For example, funds could be delayed if the draft/check is written from an out-of-state bank, or if there is a reasonable belief that it will not be honored. (There are other circumstances also.) The law was enacted to avoid unnecessary delays. The availability schedules provided by the act ranged from immediate availability to a maximum of five days on portions of deposited funds depending on the time required for the check-clearing process (i.e. check is processed, verified and paid to your financial institution). We always strive to give immediate availability to checks deposited and place holds only in special circumstances.

You are always welcome to call or visit the credit union to inquire about our check hold policy. Due to the complicated nature of the policy, never hesitate to request a supervisor's assistance if there are special circumstances surrounding your check deposit.

Sincerely,

Patrick White, General Manager
Flint Area School Employees Credit Union

Our policy is to make funds from your deposits available to you not later than the first business day after the day we receive your deposit. Electronic direct deposits will be available on the day we receive the deposit. Once they are available, you can withdraw the funds in cash and we will use the funds to pay checks that you have written. 

For determining the availability of your deposits, every day is a business day, except Saturdays, Sundays, and federal holidays. If you make a deposit before 6:00 p.m. on a business day that we are open, we will consider that day to be the day of your deposit. However, if you make a deposit after 6:00 p.m. or on a day we are not open, we will consider that the deposit was made on the next business day we are open.

Longer Delays May Apply

In some cases, we will not make all of the funds that you deposit by check available to you on the first business day after the day of your deposit. Depending on the type of check that you deposit, funds may not be available until the fifth business day after the day of your deposit. However, the first $100.00 of your deposits will be available on the first business day.

If we are not going to make all of the funds from your deposit available on the first business day, we will notify you at the time you make your deposit. We will also tell you when the funds will be available. If your deposit is not made directly to one of our employees, or if we decide to take this action after you have left the premises, we will mail you the notice by the day after we receive your deposit.

If you will need the funds from a deposit right away, you should ask us when the funds will be available.

In addition, funds you deposit by check may be delayed for a longer period under the following circumstances:

We believe a check you deposit will not be paid.

You deposit checks totaling more than $5,000.00 on any one day.

You redeposit a check that has been returned unpaid.

You have overdrawn your account repeatedly in the last six months.

There is an emergency, such as failure of communications or computer equipment.

How Funds Availability Affects Check Endorsements (Regulation CC)

To implement the Funds Availability Act adopted by Congress, the Federal Reserve Board adopted Regulation CC, effective September 1, 1988. This regulation includes rules to expedite the collection and return of checks. It specifies standards for the location and information to be found in endorsements (to improve readability thus quickening the process.) These rules apply to all parties involved in the check-clearing process: depository, collecting and/or returning banks, and to you as payee.

Your endorsement (as payee on a check) should be found within the area 1 1/2 inches from the trailing edge of the check. Other areas are specified for the endorsements of depository, collecting and/or returning financial institutions.

You must endorse the check within the specified area to avoid interfering with the readability of an endorsement required later. Under certain circumstances, you could be liable if a check is returned late due to the unreadability of another endorsement. 

If you have further questions regarding endorsements, please call us or ask your teller for assistance prior to endorsing the check(s).