I have a HELOC account with Bank A and a checking account with Bank B. Both are held jointly with my wife but neither requires both signatures. Because I live a distance from Bank B, I usually deposit checks in an ATM at Bank C, at which I do not have an account, but which uses the same network as Bank B.
I deposited a check from the HELOC for $34,000 into my account at Bank B using the Bank C ATM. The check had me as the payee and me as the signer, but did not have an endorsement on the back. I figured that the check was from me and to me so any endorsement was meaningless. Bank B froze all of the money apart from the first $300 for 5 days, as I expected. On the fifth day, the money was marked as "Available" online, so I transferred it electronically to a savings account at another Bank (D), which is also jointly held. The next day, the $34,000 was removed from my account because the original check was not endorsed and it needs to be mailed across the country before the funds can be re-credited. I gather this is likely to take a week. In the meantime, I have an unauthorized overdraft of $27,000 and various checks have or will bounce despite the fact that I had $5,000 in the account before this mess started. While I am sure that I can recover the various fees from Bank B when they finally re-credit the funds, I am concerned about the impact on my Credit Score as well as the inconvenience of dealing with the bounced payments.
What is going on? Why would I need to endorse a check that is from me and to me? Since the HELOC check named both my wife and I, should she have endorsed it as well as me? I cannot find any information on endorsement policies at Bank B and my discussions with them have been completely useless. Their only suggestion was to wire $27,000 to my account directly to eliminate the unauthorized overdraft.
Although Bank B could have accepted the check without endorsement and credited your account under provisions of the Uniform Commercial Code, it is not obliged to do so. The fact that you deposited the check at an agent bank through the ATM network might have forced their hand. The ability of the agent bank to accept the unendorsed check may not be covered in network rules. It certainly is not addressed in the Uniform Commercial Code. Bank B may have been pushed into a corner on this situation.
If possible, quickly wire transfer funds from your savings account into your Bank B account to cover the problem of the overdraft there. There may be a cost involved, but the hassle of dealing with bounced payments, as you have suggested, will more than outweigh that cost.
If you have a need to use an agent bank's ATM again for a deposit, ensure that the check is endorsed. As for your credit score, you needn't be concerned if Bank B continues to maintain your account. Most adverse reporting on deposit accounts occurs when banks close accounts for cause, with or without an overdraft to charge off. If you resolve the current situation and have no further problems with Bank B, the events surrounding "this mess," as you describe it, will likely never be reported to a credit bureau.
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Although Bank B could have accepted the check without endorsement and credited your account under provisions of the 