The "what if the president showed up" thread reminded me of a story from when I worked at MajorBank. I didn't want to hijack that thread, so I thought I'd start a new one.
A banker had called because his customer was all upset because his available balance on his home equity line wasn't reflecting a recent, very large payment. The payment had been applied, but we hadn't freed up the funds to reflect it yet. It's sort of a grey area, and the computer does it automatically based on a particular algorithm that takes into account the method of payment and the amount of the payment in comparison to what the customer typically pays, in addition to whether or not the account would go over the credit limit if we had to reverse the payment, among other things.
Some examples:
Customer A generally makes payments of $100 with a check from a DDA held at the same bank. The $100 payment shows as paid on the date he gave it to us, and the available balance on the credit line reflects the new available credit immediately (well, after overnight processing, that is). One month he comes in and makes a $5000 payment, also with a check from the DDA held at the same bank. The same thing happens. The available credit goes up by the amount of his payment immediately.
Customer B also makes $100 payments, but generally makes them in cash. As with Customer A, the available balance is adjusted immediately. One month, he comes in and makes a $5000 payment with a check from a DDA held at a different bank. We apply the payment so it shows as paid on the day he made the payment, but we DO NOT adjust his available balance until the check clears the other bank. Unfortunately, it can take several days before we know that's happened.
Now, in the case of a Customer B, there are ways around this. If the customer can prove that the check has already cleared the originating account, we had a procedure we could follow to free up the funds. The banker was calling on behalf of a customer B.
So, here I am explaining all this, and assuring him that this was standard operating procedure and the hold was computer generated based on the aforementioned algorithm, and trying to explain how he could get the hold lifted early and the banker says to me "But what if the Pope wrote the check? Would you still place that hold?" In one of my few moments of levity, I replied "Yes, sir. If God himself wrote the check we'd still hold the funds until he could prove the check cleared the originating account."
There was a tiny amount of silence on the other end of the line, but then the banker busted out laughing. I was sooooo relieved he laughed, because really, I could have gotten in a lot of trouble for that.
A banker had called because his customer was all upset because his available balance on his home equity line wasn't reflecting a recent, very large payment. The payment had been applied, but we hadn't freed up the funds to reflect it yet. It's sort of a grey area, and the computer does it automatically based on a particular algorithm that takes into account the method of payment and the amount of the payment in comparison to what the customer typically pays, in addition to whether or not the account would go over the credit limit if we had to reverse the payment, among other things.
Some examples:
Customer A generally makes payments of $100 with a check from a DDA held at the same bank. The $100 payment shows as paid on the date he gave it to us, and the available balance on the credit line reflects the new available credit immediately (well, after overnight processing, that is). One month he comes in and makes a $5000 payment, also with a check from the DDA held at the same bank. The same thing happens. The available credit goes up by the amount of his payment immediately.
Customer B also makes $100 payments, but generally makes them in cash. As with Customer A, the available balance is adjusted immediately. One month, he comes in and makes a $5000 payment with a check from a DDA held at a different bank. We apply the payment so it shows as paid on the day he made the payment, but we DO NOT adjust his available balance until the check clears the other bank. Unfortunately, it can take several days before we know that's happened.
Now, in the case of a Customer B, there are ways around this. If the customer can prove that the check has already cleared the originating account, we had a procedure we could follow to free up the funds. The banker was calling on behalf of a customer B.
So, here I am explaining all this, and assuring him that this was standard operating procedure and the hold was computer generated based on the aforementioned algorithm, and trying to explain how he could get the hold lifted early and the banker says to me "But what if the Pope wrote the check? Would you still place that hold?" In one of my few moments of levity, I replied "Yes, sir. If God himself wrote the check we'd still hold the funds until he could prove the check cleared the originating account."
There was a tiny amount of silence on the other end of the line, but then the banker busted out laughing. I was sooooo relieved he laughed, because really, I could have gotten in a lot of trouble for that.
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