Fastest way to withdraw money from Ally Bank

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Post Reply
Topic Author
freelancer
Posts: 24
Joined: Sat Jan 10, 2015 2:55 pm

Fastest way to withdraw money from Ally Bank

Post by freelancer » Sat Jan 10, 2015 3:09 pm

I expect that I will need to withdraw a large sum from my Ally Savings account for a home purchase down payment sometime in the next 6 months. Usually the escrow companies ask for either a wire transfer or a cashier's check. I can see three ways of doing this:

1. Direct wire transfer from Ally to Escrow
2. ACH from Ally to local brick and mortar CU -> wire from local CU to Escrow
3. Paper check deposit from Ally to local CU -> Wire from local CU to Escrow

I'm only considering options 2 and 3 because I saw one Ally review where there was some trouble with the wire transfer. My questions are:
1. What are people's experiences with option 1?
2. Is ACH faster or slower than Check deposit for funds to become available? I know that different laws govern ACH and checks.. but objective and new information about the speed of transfer is hard to find.

Thanks!

terran
Posts: 1018
Joined: Sat Jan 10, 2015 10:50 pm

Re: Fastest way to withdraw money from Ally Bank

Post by terran » Sat Jan 10, 2015 10:53 pm

I would open an account at a local bank and transfer the money to there. We already had one as I find it helpful to be able to deposit cash when needed, but we transferred the money we would need for the downpayment to our local bank well in advance of our closing date. At least in our experience we didn't know the final amount that would be needed until the day before (or maybe even the day of) closing, so trying to do it with only Ally wouldn't have worked.

Nebster
Posts: 118
Joined: Thu Feb 02, 2012 4:48 pm

Re: Fastest way to withdraw money from Ally Bank

Post by Nebster » Sun Jan 11, 2015 3:14 am

Are you trying to minimize the amount of time the funds are not at Ally? If not, why not just go with (a), a few days or weeks in advance of closing if you're worried?

Wires are processed either same-day or next-day depending on when you get the form in to Ally. They are, bar none, the most reliable and fast way to move the money. If there is a problem, your extra days (weeks) will give you plenty of time to work it out.

If you're concerned about getting the exact right amount into escrow, perhaps you could just wire a bit extra and have them cut you a check at closing (or wire it back, for a fee). In many transactions the amount due at closing is known pretty far in advance.

I don't think there's any alternative to a wire that's more reliable, faster, or less complicated. All of the alternatives are worse in all of these dimensions. I've sent many wires from Ally with no issues. I wouldn't let one review somewhere cause you to jump through all these unnecessary hoops. Your scenario is just what wire transfers are for.

User avatar
Tyrobi
Posts: 697
Joined: Thu Jun 04, 2009 12:29 pm
Location: Florida
Contact:

Re: Fastest way to withdraw money from Ally Bank

Post by Tyrobi » Sun Jan 11, 2015 7:07 am

Last year when I purchased a house for my parents and transferred it under my name, I roughly use option 2. Here is the process:

After I received the Settlement Statement, I knew the exact closing date and the exact amount in the wiring instruction.

A week before the closing date, I ACH the required fund from Ally to my Charles Schwab checking account.

A day before the closing date, I wired the money from Charles Schwab to the escrow account.

The transaction closed smoothly on closing day as expected.
Three-fund portfolio | "Simplicity is the master key to financial success." John C. Bogle

stlutz
Posts: 5466
Joined: Fri Jan 02, 2009 1:08 am

Re: Fastest way to withdraw money from Ally Bank

Post by stlutz » Sun Jan 11, 2015 1:22 pm

A week before the closing date, I ACH the required fund from Ally to my Charles Schwab checking account.

A day before the closing date, I wired the money from Charles Schwab to the escrow account.

The transaction closed smoothly on closing day as expected.
Why was this preferred over just doing a wire from Ally?

jasonwhitman
Posts: 2
Joined: Mon Dec 31, 2012 8:29 pm

Re: Fastest way to withdraw money from Ally Bank

Post by jasonwhitman » Sun Jan 11, 2015 1:41 pm

I needed to get money out of Ally for the same reason. I originally tried to ACH it to my local bank, but Ally's feedback on when it would be delivered was not fast enough. After calling Ally, I filled out some simple forms for the wire transfer, faxed them, and the transactions happened quickly without any issues. Ally even called me to verify the information and update me on when the transactions were completed.

If you want speed, I recommend wire (and Ally can walk you through it). If you want ease (and don't need speed), I recommend ACH.

Best of luck.

Topic Author
freelancer
Posts: 24
Joined: Sat Jan 10, 2015 2:55 pm

Re: Fastest way to withdraw money from Ally Bank

Post by freelancer » Sun Jan 11, 2015 3:23 pm

Thanks for all the feedback. I wonder why they still use something as archaic as fax for wire transfers. If I go with option 1 , I'll have to figure out how to get access to a fax machine. My local bank has an online form for write transfers.

User avatar
Kevin M
Posts: 11252
Joined: Mon Jun 29, 2009 3:24 pm
Contact:

Re: Fastest way to withdraw money from Ally Bank

Post by Kevin M » Sun Jan 11, 2015 4:06 pm

The ACH transfer from Ally should take 2 business days. I don't recall ever seeing an exception to this, and I have done many. In their FAQ they say 3 business days, but in my experience that's only true if you count the day you send it; i.e., send on Monday and it should be there by Wednesday. I trust this so much that I scheduled an I Bond purchase from TreasuryDirect on Wednesday, 12/31/2014 (hoping for an issue date of 12/1/2014 to get interest for December, which worked), and on Monday 12/29/2014 scheduled an ACH transfer from Ally to the credit union used for funding the I Bond purchase.

Then the other question I would ask the local bank or CU is whether there is any difference in whether or not they will place a hold on the funds, and if so, for how long. I would expect a check to take longer to clear. We did exactly this when my partner sold her condo in 2013, but I don't remember what her local bank said, and it doesn't matter anyway because what matters is the policy of your local bank or CU.

One detail that probably doesn't apply to you, but that is interesting to note, is that the company handling the escrow would not accept a wire transfer from an account that wasn't held in the name of her living trust, since the condo was in her trust. That's the reason she couldn't do a wire transfer from Ally--she holds her accounts there as POD instead of in the name of her trust.

Kevin
Wiki ||.......|| Suggested format for Asking Portfolio Questions (edit original post)

User avatar
Kevin M
Posts: 11252
Joined: Mon Jun 29, 2009 3:24 pm
Contact:

Re: Fastest way to withdraw money from Ally Bank

Post by Kevin M » Sun Jan 11, 2015 4:12 pm

freelancer wrote:I wonder why they still use something as archaic as fax for wire transfers.
Ally is great in many ways, but they make some things difficult. For example, you can do a Roth IRA conversion completely online at Vanguard or Fidelity, but Ally requires you to mail them a paper form to do this. Each financial institution has its own quirks. But really, FAX? Jeez.

Kevin
Wiki ||.......|| Suggested format for Asking Portfolio Questions (edit original post)

Post Reply