When you place your money in a bank account, you give the institution some measure of control over it. The bank can debit it for fees and can close the account for just about any reason, according to CNN Money. But the money is still yours, so if there's a balance at the time the account is closed, the bank must return it to you.
Legally, a bank must return any funds in your account, minus allowable fees, if they decide to close the account.
A History of Overdrafts
Banks usually close accounts for one of three reasons, and not managing the account responsibly makes the list. If you have a history of overdrafts, it's possible — and even likely — that the bank will shut down your account, according to the FDIC. Many times, there is no remaining balance, particularly if the bank paid a check that overdrew your account. In this case, you'll probably owe the bank money, so you can count on hearing from the institution, or — worse — from a debt collector if they turn the matter over for collections.
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Banks may also close your account for suspicious activity — if you're engaging in some sort of fraud, the institution can be held partially responsible. Banks sometimes err on the side of caution even if you have a perfectly good explanation for odd banking activity, such as frequent, large transactions when you don't hold a job. But if the bank closes your account because it's uncomfortable with its activity, this doesn't mean it can keep your funds. You should receive notification, telling you how to go about getting your money. If you don't, consult a lawyer or legal aid for help.
Banks also close dormant accounts — those that have shown no deposits or withdrawals for an extended period of time — the money is just sitting there. It might take as little as a year with no activity before the bank will shut an account, but three to five years is the norm. Some states legally obligate banks to make an effort to contact the customer at her last known address when this happens. They may be required to post a notice for the account holder in the local newspaper. If you don't turn up to claim your balance, the institution must send the money to the state as unclaimed property.
You can make a claim with the state to get your money back. The National Association of Unclaimed Property Administrators offers a searchable website where you can enter your name and your state and look for a match with any unclaimed property in the database. Follow the directions for how to place your claim — it can vary by state. If your money doesn't turn up in a search, contact the financial institution for more information to narrow down it down, such as when the account was closed and the money transferred. Then contact your state's unclaimed property division directly.
- Federal Deposit Insurance Corporation: Have You Bounced Yourself Out of a Checking Account?
- CNN Money: Why Your Bank Can Break Up With You
- HelpWithMyBank.gov: Answers About Inactive Accounts
- MyBankTracker: What Happens to Inactive Bank Accounts?
- National Association of Unclaimed Property Administrators: Homepage