Multiple current accounts

Archi_Bald

Only things that could stop you is

1. not being accepted for an account with the bank that offers a switch bonus
2. the concern / the knowledge that you can't get the interest-paying account again (e.g. Santander only allow 1 sole and 1 joint 123 account for new applications whilst previously you could have an unlimited number of 123s; TSB only allow 1 sole and 1 joint for new applications, whilst previously you could have 2 of each etc)

Nothing to stop you to open specific donor accounts just for switching.

saintalan

colsten wrote: »

...
I don't think there is a known average of accounts people have. Some have one, some have 3 dozen, some have something in between. There is no such thing as "too many". Regarding your credit file - you just need to make sure you do not get any late payment markers or other defaults, and that you do not have a huge amount of available credit if you want to apply or a mortgage or other major koan.

Well, I have just had a bit of a rude awakening, due to large incoming sum during May/June I started opening accounts for the big merry-go-round, Santander, TSB, Lloyds, BOS, Tesco for me and the OH, all went without problem.

Now the OH has been rejected for a £20/m Vodafone SIM only monthly a/c.

We have no mortgage or other debts, we do have earned income, investments, ISA's and maximum amounts filling the current a/cs and TESCO savers etc.

On checking her Experian it shows 3 neg score factors:

1. You have opened 4 new credit accounts in the last six month

2. You have made 8 credit applications in the last 6 months

3. The average age of your credit accounts is 10 months

It lists 8 Searches which negatively affect score as:

• VODAFONE LTD
• 2 x TESCO PERSONAL FINANCE LIMITED
• 2 x BANK OF SCOTLAND CURRENT ACCOUNT
• LLOYDS BANK
• TSB BANK PLC
• SANTANDER

and 10 Searches with no impact

• 3 xLLOYDS BANK
• 4 x TESCO PERSONAL FINANCE LIMITED
• 2 x HALIFAX (assume BOS?)
• TSB BANK

It lists all these as CREDIT A/Cs however I have ensured that none included overdraft or loan facilities!

All this has resulted in a (low) poor score.

On the plus side she has 2 Positive score factors

• total non-mortgage credit balance is £9.00

• You are using 6 non-mortgage credit accounts

I seem to have managed to open my Vodafone a/c as they went through it on the phone with me as it didnt go through on line, but the OH went through online and got rejected.

I am most annoyed at missing out on the 50% cashback for her:mad:, will probably have to wait until the end of year till the searches register as older than 6 months or wait 3 months (as they say) and add it to my a/c.

Also very annoying that current a/cs get treated as credit!

Comments welcome:)

wannaberichbtch

Your post is interesting Saintalan, it appears that the banks are classing current account applications as credit applications. Whilst I agree with the need for a sensible lending policy, the search should only reflect your request (indeed if you later wanted an overdraft on one of these accounts this would trigger a further search).


On the plus side I'm sure you've gained more interest than would have saved on the phone contract, I would see this as a minor although irritating setback, your strategy has still paid off.

planteria

tend to agree, but it is a warning too.

masonic

saintalan wrote: »

On checking her Experian it shows 3 neg score factors

Experian may deem the stated three factors to have a negative impact but Vodafone will have their own scoring system and criteria which may be different.

It lists 8 Searches which negatively affect score as:

• VODAFONE LTD
• 2 x TESCO PERSONAL FINANCE LIMITED
• 2 x BANK OF SCOTLAND CURRENT ACCOUNT
• LLOYDS BANK
• TSB BANK PLC
• SANTANDER

and 10 Searches with no impact

It lists all these as CREDIT A/Cs however I have ensured that none included overdraft or loan facilities!

This should not be a surprise. Standard current accounts come with the facility to go into an unplanned overdraft, so there is a implicit line of credit.

However, you state above that your Tesco accounts were savings accounts, which should not have resulted in a credit search (I opened 2 Tesco savings accounts and my Experian report shows only one "IDENTIFICATION: GENERIC CHECK" search from Tesco Personal Finance, which is not a credit search).
Edit: I now see you mention Tesco among the current accounts as well.

I seem to have managed to open my Vodafone a/c as they went through it on the phone with me as it didnt go through on line, but the OH went through online and got rejected.

Or could it be that your previous Vodafone search is what tipped the balance? Maybe up to 7 searches in the past 6 months is ok, but your first Vodafone search took it up to 8, preventing the second application from being accepted.

saintalan

Thanks wannaberichbtch, planteria & masonic for your comments.

At least I know where I stand however the caution that needs to be heeded is not the problem of opening multiple bank accounts more like the potential it may have to cause trouble for something simple like taking out a simple low cost phone contract!

It seems the credit check is only concerned with what you might do rather than the actual health of your financial circumstances...I guess I can understand that...just about.

Cheers

Alan
PS I am still annoyed!

ceredigion

Saintalan


You have found the fundamental flaw in the system. The credit rating agencies are very good at telling their clients what your debt / potential liability's are but have not a clue what your total worth is, nor your ability to repay.
Personally my file is permanently stuck in "poor" mainly because of the money I stooz . But if I settled the debt there would still be cash reserves totalling ten plus years of income. That said never been turned down for a financial product .


Edit; Tell a lie , just remembered . Was once turned down for a 1-2-3 credit card, that was before I was updated to a select account and all of a sudden they were falling over themselves trying to get me to take one. Its a funny old world.

saintalan

ceredigion wrote: »

Saintalan


You have found the fundamental flaw in the system. The credit rating agencies are very good at telling their clients what your debt / potential liability's are but have not a clue what your total worth is, nor your ability to repay...

My post and subsequent thoughts give rise to potential consequences that everyone considering multiple current accounts should be aware of.

As I have said I have no plans to gain credit i.e. loans etc but what else is there that might bite me a la Vodafone?

Basic utilities? Zero% interest deals? Anything requiring a Direct Debit?

Next step in my merry-go-round was donor accounts for cashback accounts etc. Probably best on hold now for 6 months?

Thoughts welcome.

Cheers

Alan

SJshah

saintalan wrote: »

Now the OH has been rejected for a £20/m Vodafone SIM only monthly a/c.

In my opinion its a good thing, their service is useless and their customer relations dept is th rudest I've ever encountered... By rejecting your application they have done you a favour!!!

:T


I've done the same thing and opened about 4-5 accounts (I've lost count) over the past few weeks... Thankfully my phone contract ends next year and I don't plan on applying for any loans/mortgages in the coming months.

masonic

saintalan wrote: »

My post and subsequent thoughts give rise to potential consequences that everyone considering multiple current accounts should be aware of.

As I have said I have no plans to gain credit i.e. loans etc but what else is there that might bite me a la Vodafone?

Basic utilities? Zero% interest deals? Anything requiring a Direct Debit?

I don't think you need worry about utilities. Credit cards and store cards obviously would do a full credit search and could be affected. It's hard to say whether they would - it could be that Vodafone are just using unusual metrics. They could be treating a lot of credit account applications as a risk factor for identity theft and one thing the identity fraudsters really like to do is take out mobile phone contracts.