If you’ve just deposited a paper check, you probably want to know when you’ll have access to the money. Wouldn’t it be nice if it were instantaneous? Truth is, the amount of time it takes a check to clear can vary.
Let’s take a look at some reasons why, what timeline you might expect, and whether there are any steps you can take to speed it up.
What does it mean for a check to clear?
Clearing a check is the process by which your bank (the payee’s bank) receives the money from the payer’s bank and confirms that there are enough funds in the payer’s checking account to complete the transaction.
Since personal checks are basically just a promise to pay you, there’s no guarantee that the money’s actually available in the payer’s account. That’s why banks take a moment to verify everything.
In other words, when you deposit checks into your bank account, your financial institution has to work behind the scenes.
How long does it take a check to clear?
Depending on the check, you might have to wait more than one business day before you can spend the money from your bank account or withdraw it from an ATM.
That’s less time than it used to take: in the old days, banks had to physically send each check to the issuing bank or to a central clearinghouse.
Modern banking systems have sped up the process quite a bit, and banks don’t have to send paper checks back and forth to each other. Now, most of the check clearing process takes place electronically.
New systems like mobile check deposits can reduce the hold time even further, since you don’t have to wait for the next business day to initiate the process.
Still, as a general rule, you can expect a check to take around two business days to clear—and a bit longer in some cases.
You should always wait for the check to clear before spending the money because you’ll have to pay the money back if it turns out to be a bounced check.
How long should you wait before spending the money?
Occasionally, when you deposit a check, you might see some of the money show up in your account balance sooner than you expected. This depends on your bank’s funds availability policy, so the amount can vary from bank to bank.
In the U.S., federal law requires banks to release the first $225 of the check deposit on the next business day. Does this mean that a portion of the check has cleared already, and you’re free to spend it? Not necessarily.
If there are insufficient funds in the payer’s account, you’ll still be required to pay it back, so only spend the money if you know where it’s coming from.
If it’s a check from your employer, you’re probably in the clear, but if it’s from someone you don’t know very well, you may want to wait until the next day.
The remainder of the deposit should be available on the second business day, unless the bank has a good reason for holding it longer.
Why it might take longer for a check to clear
Two business days is a good estimate if you’re wondering how long it takes a check to clear. But the exact length of time will depend on the type of check, the amount of the check, and how long you’ve had an account at your financial institution.
Here are a few reasons you might have to wait longer for a check to clear:
- You have a new account: If you’ve opened your checking or savings account recently, then your bank may place a hold on any checks you deposit by default. Once your first check clears successfully, your bank may increase your deposit limit.
- You’ve overdrawn your account: If you, as the account holder, have a history of overdrafts or depositing bounced checks, then it may take longer for a check to clear.
- It’s for a large amount of money: According to Regulation CC (the rules that U.S. banks must follow when processing checks), banks can hold checks in excess of $5,525 for longer than checks that are below that amount.
- It’s from an unfamiliar payer or an international bank: If it’s the first time you’ve deposited a check from a particular payer or if the check is from an overseas bank account, then it may take longer for your bank to verify the funds.
How to reduce the amount of time it takes a check to clear
Once you’ve deposited a check, there isn’t a lot you can do to speed up the process. You’ll just have to be patient and wait for it to clear.
But if you haven’t deposited it yet, there are a few steps you can take to reduce your chances of a bounced check and speed up the processing time:
- Deposit it in person: If you visit your bank or credit union to deposit a check in person, your bank is likely to process it faster than if you deposit it in an ATM.
- Check your bank’s schedule: Be sure to check your bank’s holiday schedule and any other schedules or cutoff times. Deposit the check before the cutoff time so you don’t have to spend extra time waiting for your check to clear.
- Request a cashier’s check: Personal checks can take longer to clear because they’re more likely to bounce than a cashier’s check, certified check, or money order. Your bank can still place a hold on a cashier’s check if it’s for a large amount of money, but you’re less likely to run into a situation where the check bounces because it’s backed by the issuing bank’s own funds.
- Contact your bank directly: If you’ve had an account at the same bank for a while and have a good personal finance history with no overdrafts, let your bank know in advance that you’ll be depositing a large check. They may be able to clear your check faster if you receive regular checks from the same payer every month.
Alternatives to check payments
Check payments are on the decline, and are being phased out altogether in some countries. But they’re still used for some types of transactions, such as paying rent.
When you deposit a check, your bank has to clear the check before the funds become available in your account. Paper checks can take up to two business days to clear—and even longer if it’s for a large sum of money or there are other factors at play.
Although there’s not a lot you can do to speed up the process, there are alternatives to paper checks that you can use to transfer money more efficiently.
If you can, ask the people that you do business with to use another payment method, such as a direct deposit or wire transfer.
If you work in the U.S., your employer may be able to pay you with an ACH transfer instead of sending you a paper check.
In many countries, you can use an online payment service to transfer money between friends—such as Venmo in the U.S. and PIX payments in Brazil.
If you need to send money internationally, you can use a service like Remitly, which offers efficient money transfers around the world.