In this article, we'll outline the process of ACH payments and how they can lead to clawbacks if they occur.

When a tenant makes a payment, our payment processor (Propay) waits 3 business days (by default) to release funds*. ​​

Most banks will provide an answer as to whether there is an ACH Return during this period, but the way the ACH system is currently set up in the US, banks are not required to reply during this period, so it is unlikely but possible that a bank replies after the 3-day period.

Additionally, we attempt to retrieve a balance check prior to the tenant paying in order to reduce the chance of an ACH return, but there are times that an ACH return or failure can result in a deposit adjustment or clawback of funds transmitted to your account.

The most common reasons for ACH Returns are:

  • Insufficient Funds: this occurs if the tenant’s bank determines that there is not enough money in their account to complete the payment.

  • Incorrect routing number or account number: Occasionally the tenant will mistakenly enter the wrong account number or routing number.

  • Bank decline: from time to time, banks decline an ACH payment. Although this is rare, it can happen.

  • Other: On rare occasions, there can be a bank-to-bank issue that causes a decline or return.

*If you have received faster funding time, the number of hold days may have been decreased.

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