Retrieve Your Deposits In The Event of a Bank Run!
With the economy in a recession and with more banks predicted to fail in the future, many of us worry about what would happen to our bank accounts and deposits if and when our bank fails. This guide will inform you of the necessary steps to take to retrieve all your bank deposits in the case of a bank failure or acquisition.
Advice and preventive steps
If you are worrying about whether or not your bank will fail, just remember that your FDIC-insured deposits are "backed by the full faith and credit of the United States government." Check to make sure your deposits are fully insured at the FDIC website: http://www2.fdic.gov/dip/index.asp. Be sure your bank account is insured by the FDIC and that you have less than $250,000 deposited per bank.
If you have more than $250,000 per account per bank, consider opening another account at another bank. Transfer enough deposits into the new account until you have less than $250,000 per bank account at all your banks. This ensures that you will be fully covered in case one of your banks ever fails.
If your bank is not performing well in the stock market, withdrawing all your deposits now would actually be unnecessary since your banking experience will most likely remain the same if and after your bank is acquired by another bank. If your bank fails, you would receive a check for all your insured deposits a few days after your bank closes. In the end, you wouldn’t be losing any deposits as long as all your deposits are insured.
You may want to keep some cash at home just in case your bank fails and isn’t bought out by another bank. This cash will tide you around until your check from the FDIC arrives.
There is really not much you have to do but wait. Your deposit accounts will be shut down. It may take a few days before you get a check from the FDIC for your insured money.
If you had a safe deposit box with your old bank, the FDIC will send you information concerning how to remove the contents of your safe deposit box.
For any deposits you have exceeding $250,000 for all deposits, you would receive a claim against the estate of the closed bank for the remaining amount of money that is not insured. You would be given a Receiver's Certificate as proof of this claim and would receive payments as the assets of the bank are liquidated.
Be sure to make other funds available to creditors who receive checks that were returned and did not clear your deposit account because of the bank closing.
Steps to take if your bank is acquired by another bank
If you had a safe deposit box with your old bank, visit it as soon as possible after your bank is acquired. Fees or due dates for payment will change. After the failures and mergers of the 1980s and 1990s, depositors who thought their safe deposit boxes were safe found out too late that the contents of their boxes had been auctioned off.
There is nothing you really need to do. Your future banking experiences with that bank will feel like business as usual. You may choose to close down your bank account at the new bank and open another account at another bank, if you don’t like the interest rates, terms of service, etc. of the new bank.
You’re likely to receive literature from your new bank. When you do, here are things you need to look out for:
New terms, fees, and interest rates for checking and savings accounts.
A new address to where you will be sending loan payment checks—if you keep sending it to the same address as before the bank failure, your new lender could count you as late; one late payment could ruin your credit score.
For your credit card, if you had a credit card with your old bank, look out for new terms, interest rate, credit limit, due date, grace period, and fees.
