• Bank account terms outline the contract between you and your bank.balancing checkbook image by palms from Fotolia.com
  
  When you open an account at a bank or a credit union, there are certain terms to which you must agree. According to Nationwide Bank, some of the terms are required by federal law, such as those that require identification information. The terms set out a contract between the bank and the account holder, and by opening the account, you agree to the rules. While each financial institution will have its own contracts and requirements, certain bank account terms are common to most banks.
  
  

Liability

• Liability means account holders are responsible for understanding and fulfilling the terms of the bank account. There may be charges and fees associated with the account, and the customer is liable for those charges as well as other incidental charges. For example, if you write a check for an amount greater than your available funds, you are liable for both the account shortage as well as any overdraft fees you may accrue, both at your bank and at any other financial institutions involved in the transaction. If there is a dispute between you and your bank, you may be liable for any costs the bank incurs during the dispute, including legal fees.
  
  

Deposits

• When you make a non-cash deposit --- checks, for example --- into your checking or savings account, your bank may elect to give partial or no credit toward the deposit until the deposit has cleared. This means you may not draw on funds for which your bank has not credited your account.
  
  Banks can also reverse credit or partial credit for deposits that are rejected, such as a bounced check. The bank is not liable for any deposits made through the mail until the deposits have been entered into the bank's system. Banks also have the right to reject third-party checks or require the payee to endorse the check in person.
  
  

Cash Transaction Reporting

• Federal law requires banks and other financial institutions to report information about certain tax transactions. This may include large cash deposits. If your bank cannot access the necessary information or you decline to supply requested information, the bank may refuse the transaction.
  
  

Security

• Account holders are responsible for the security of their account numbers and bank-issued ATM, debit and credit cards, as well as checks. If you authorize another person to make withdrawals on your account, you are liable for the funds. If any transactions seem irregular or fraudulent, the bank has the right to freeze your account until the matter is resolved. US Bank notes that if your account information has been illegally accessed or stolen, it is your responsibility to notify the bank immediately.