switching for cash

jonesMUFCforever

stehouk wrote: »

I'm fairly new to this switching for cash/incentives, i have done 4 all went through easily and i have a spare tesco mule account that i opened 3wks ago, my question is i have started and abandoned 2 applications because of the in-depth application questions with both m&s and first direct that were not asked on any of my previous switches, ie: how long have i held my current account, how much will i pay into the new account, will i pay my wage into the account, how much will i deposit over a year, how will i fund the account, how much will the first payment be etc etc etc
I assume they are trying to weed out the serial switchers by asking all these questions.
I am switching a new mule account for the bonus, will they refuse me an account if i answer correctly :A or should i erm adapt my answers :rotfl:

They ask all the questions because its called 'know your customer' - by law they must make reasonable steps to find out where the monies going in and out of your accounts are coming from.
For example if you said that your salary of £500 would go in but in fact £5000 was credited would this not arouse suspicion that perhaps all was not well ie you were potentially money laundering?

ValiantSon

EachPenny wrote: »

It is probably more likely to be due to you recently applying for several other current accounts including the Tesco one you are looking to switch (only 3 weeks ago) and the Natwest switch. How many of the 4 were within the last 6 months?

As I've said elsewhere, this is possibly the case, but not necessarily. I really think that you need to be less definitive in the way that you present this. If you had written, "One possibility is that your other recent current account applications have made them wary of offering you another account at this time," then that would be a fairer representation of the situation. There are many, myself included, who have made numerous account applications in a short space of time and have been accepted by all banks (including the notoriously fussy HSBC and First Direct). The point is, that despite our applying for several accounts, our financial and personal circumstances still make us attractive customers.

By constantly reiterating the point about the number of credit searches on someone's file, what you are doing is reinforcing a flawed understanding of how banks decide on who to offer an account to. It is flawed because it treats the credit score as a factor in isolation from all of the others that they will consider when making their decisions.

EachPenny wrote: »

If banks are looking to make more money out of you then they are thinking about cross-selling of other products. E.g. You open a current account and they can then try to sell you credit cards, insurance etc. Having a current account which is a 'main' one rather than a 'backup' one is unlikely to generate them much additional income, unless you are constantly paying fees and charges for being overdrawn.

Having you as a customer, whether you use the account as a "main" account or not, makes you equally accessible for cross-selling. They are actually interested in whether or not your net worth, financial position, and personal circumstances, make it a reasonable possibility that you will be interested in buying additional products from them.

Having First Direct (or any other bank) as your "main" account is no more likely to generate income for them as having them as a "secondary" account. The only key difference is the likelihood of fees from overdrafts. Anyone who is in a strong financial position is unlikely to ever need an overdraft and so even that is of little relevance. For what it is worth, I have no overdraft facility on any of my current accounts. I have no need for it, and never ask for one, and yet every one of the major banks and building societies (excluding Lloyds - who I have not applied to as they offer nothing I have need of at present, but including other banks that are part of Lloyds Banking Group) have all been willing to provide me with an account, knowing that it will not be used as my "main" account (given the details of funding provided in my application).

It keeps coming back to the point that approval for accounts is based on a holistic view of the applicant, of which a credit search is but one factor.

EachPenny wrote: »

The best bet is to wait for 6 months without doing any more switching and then try again. But don't be tempted to lie because that lie can still come back on you.

I completely agree with you about lying on an application.

I'd also agree that trying again in six months to a year may be worth a go, but that changes in other aspects of the OP's personal and financial circumstances are just as important. It may be that it was their credit file that let them down, but it could just as easily not be. Even if they are successful in six months this will not confirm that it was the credit file that was the issue the first time: assuming as much would simply be falling foul of confirmation bias.

EachPenny

stehouk wrote: »

I think you are right i have overdone my applications, i have 2 new credit cards, 4 new current accounts and 3 savings accounts within the last 6 weeks, its become a bit of an addiction, (they're are worse addictions though) i did think prior to applying that it might be declined, i must say though i think both m&s and first direct applications are far more in depth than halifax,tesco tsb and nationwide, and they are virtually identical in layout, must be the same for hsbc.
Will have to wait 6 mths now i hope i don't miss any decent switches while waiting.

6 credit applications in 6 weeks is probably what has done it then. It doesn't mean you aren't an attractive customer (normally), just that it appears something is a bit unusual now.

Go 'cold turkey' on bank accounts/cards for 6 months, then try again (but be honest!)

ValiantSon

stehouk wrote: »

I think you are right i have overdone my applications, i have 2 new credit cards, 4 new current accounts and 3 savings accounts within the last 6 weeks, its become a bit of an addiction, (they're are worse addictions though) i did think prior to applying that it might be declined, i must say though i think both m&s and first direct applications are far more in depth than halifax,tesco tsb and nationwide, and they are virtually identical in layout, must be the same for hsbc.
Will have to wait 6 mths now i hope i don't miss any decent switches while waiting.

The savings account applications shouldn't have resulted in a credit search. They may have done a soft search to confirm your identity, but they shouldn't have done a hard search. Soft searches are not visible to banks (or any other companies) when they search your credit file during an account application.

HSBC's application has some similarities to First Direct and HSBC, but it is not the same.

EachPenny

ValiantSon wrote: »

As I've said elsewhere, this is possibly the case, but not necessarily. I really think that you need to be less definitive in the way that you present this. If you had written, "One possibility is that your other recent current account applications have made them wary of offering you another account at this time," then that would be a fairer representation of the situation. There are many, myself included, who have made numerous account applications in a short space of time and have been accepted by all banks (including the notoriously fussy HSBC and First Direct). The point is, that despite our applying for several accounts, our financial and personal circumstances still make us attractive customers.

By constantly reiterating the point about the number of credit searches on someone's file, what you are doing is reinforcing a flawed understanding of how banks decide on who to offer an account to. It is flawed because it treats the credit score as a factor in isolation from all of the others that they will consider when making their decisions.

I disagree with you but I am not prepared to engage in further debate on the matter. Too many threads on this board are currently being ruined by pointless arguments over petty details.

The OP has been given advice and suggestions relevant to their situation, nothing else needs to be said.

ValiantSon

EachPenny wrote: »

I disagree with you but I am not prepared to engage in further debate on the matter. Too many threads on this board are currently being ruined by pointless arguments over petty details.

You disagree that banks take more into consideration than just the credit search? If that's so then you are just wrong!

This isn't a pointless argument; it is a matter of material difference. You keep making an assumption that reinforces a false impression. I have tried to explain how the actual decision making process is more complex than you portray.

I find your peddling of this myth to be quite disappointing, when you could easily explain otherwise, but you choose not too. This does rather suggest a strong stubborn streak.

EachPenny wrote: »

The OP has been given advice and suggestions relevant to their situation, nothing else needs to be said.

What I contributed added to that. Nothing required you to add to the post count by telling me that you disagreed with me about something that is factually correct.

We have butted heads quite a lot recently, but that is almost exclusively down to your intransigence of thought and your determination to disagree with pretty well everything I write. You can stop this any time you like by not challenging accurate posts.

stehouk

I just want to clarify my situation, i cannot blame them for declining me, i have no mortgage, no debt whatsoever, no overdraft facility, no credit card debt, i have credit cards so i can hire cars abroad, my salary rarely spends more than 24hrs in my main account so i can see why i don't meet their criteria, they want to sell me a mortgage or insurances, pay interest on loans/over drafts.

[Deleted User]

ValiantSon wrote: »

You should answer all questions honestly. Doing otherwise could potentially land you in very hot water for fraud.

The questions asked by First Direct and M&S are intended to give them a full picture of you so as to decide whether or not you are an attractive customer. They are entitled to ask these questions, just as you are entitled to decide that you don't want to disclose the answers and therefore not proceed with your application.

Agreed

ValiantSon wrote: »

It would be fraudulent to claim that you will pay in £X (equivalent to your net salary) and then not do so.

One of the questions on the application is whether you have any reason to believe that your circumstances will change in the next two years. If you did as you suggest above then you would have lied on your application and they would treat it as fraud. At the very least they would shut all of your accounts with them without any notice, and they may well place a CIFAS marker too.

The bold bit - really?? You can intend to pay your net salary in and then not do so for a variety of reasons - for example: my employer, despite me asking them twice and updating it on the self service portal, have still not updated my salary destination. Two months later it is still going to my "old" bank account. So am I committing fraud by not paying my salary into what is supposed to be my new main account?


If you answer you will pay your employment income in, and the amount matches your income - i.e. X will pay in £1,557. X's net pay is £1,557, then that's surely all that matters in terms of 'fraud'.

If the bank don't like you not paying said income in, they (eventually) will close your account down - but if the figures you state are correct then they won't be perusing fraud.

Also you could decide you could be offered an incentive by another bank (or open another bank account) and then declare that they will be your main account. IF it were to be used as a basis for fraud cases, when does the old (original) declaration then not count? A day later? Month, Year?

RE: the changes in next 2 years, that's true, but again it depends exactly what someone is suggesting doing. My understand is that stehouk is just stating wages will be paid into that account, when it won't be. I can't see anything saying that the OP is going to 'make up' figures (e.g. income, expenditure, dependents) just that they are intending to lie/mislead on the purpose of the account - potentially immoral, but not illegal.

Obviously if OP doesn't earn enough to reach minimum pay in, and declares this truthfully (as required), the application is very unlikely to proceed anyway. If it does proceed, or if the OP does earn enough, then any 'supplementary' information and whether one follows it or not shouldn't make a material difference.

If I open an account now and declare I will transfer £500 a month from savings (I have some investments maturing) - but what is 'savings'?? Investments clearly are.

However - say you are paid £1,000 (and they put the app through). Move £500 away to another account as you intend to "save" it. You then move it back (a minute, hour or day later - since you need to 'spend' the 'savings'), that should still be savings. There is no rule that income needs to be deposited for X days to then count as 'savings'.

All HSBC Group do by asking the intended source etc is take customer profiling to another level. All other banks INTEND that you use it as your main account (2 direct debits, 5 star jumps, £750 in a month, a debit card transaction, use online banking....) so the same immoral argument could be made for people with multiple accounts.

Edit: Regarding "length of time at bank". I take this to mean my "main" bank. What people deem to be a main bank can vary - is it where your salary goes? The one you visit in person most often? The one you are considering for your mortgage/credit card/loan? The one you've had the longest?

I take it to be longest, since that's the rapport/relationship built up. Somebody else could take it to mean where the salary goes (Which could be a very different account). As long as you're consistent and have clear reasoning (and the account you are referring to is still open) then again you aren't committing fraud.

Although Banks play judge, jury and executioner regarding CIFAS markers with very limited scope for appeal and big consequences if they slap you with one! But, my reasoning is my Lloyds account is my main account - open longest, and they give me free cinema tickets - but DON'T have my salary paid in. If they want to dispute that declaration with me in court or up to the FOS then they can do.

ValiantSon

Somerset_La_La_La wrote: »

Agreed


The bold bit - really?? You can intend to pay your net salary in and then not do so for a variety of reasons - for example: my employer, despite me asking them twice and updating it on the self service portal, have still not updated my salary destination. Two months later it is still going to my "old" bank account. So am I committing fraud by not paying my salary into what is supposed to be my new main account?

No, because as I said, they ask if you are aware of any reason why your circumstances might change in the next two years. If you answer no and then proceed to not pay in monies that you said you would they are entitled to ask what has changed. If it is something completely unforseen that is fine, but if it isn't then you have made a fraudulent statement on your application.

Somerset_La_La_La wrote: »

If you answer you will pay your employment income in, and the amount matches your income - i.e. X will pay in £1,557. X's net pay is £1,557, then that's surely all that matters in terms of 'fraud'.

See above.

Somerset_La_La_La wrote: »

If the bank don't like you not paying said income in, they (eventually) will close your account down - but if the figures you state are correct then they won't be perusing fraud.

Also you could decide you could be offered an incentive by another bank (or open another bank account) and then declare that they will be your main account. IF it were to be used as a basis for fraud cases, when does the old (original) declaration then not count? A day later? Month, Year?

See above.

Somerset_La_La_La wrote: »

RE: the changes in next 2 years, that's true, but again it depends exactly what someone is suggesting doing. My understand is that stehouk is just stating wages will be paid into that account, when it won't be. I can't see anything saying that the OP is going to 'make up' figures (e.g. income, expenditure, dependents) just that they are intending to lie/mislead on the purpose of the account - potentially immoral, but not illegal.

Yes it is illegal. It is fraud by false representation.

Somerset_La_La_La wrote: »

Obviously if OP doesn't earn enough to reach minimum pay in, and declares this truthfully (as required), the application is very unlikely to proceed anyway. If it does proceed, or if the OP does earn enough, then any 'supplementary' information and whether one follows it or not shouldn't make a material difference.

It does because the bank is interested in your profitability as a potential customer. They make their decisions based on a wide range of factors and they are entitled to do so.

Somerset_La_La_La wrote: »

If I open an account now and declare I will transfer £500 a month from savings (I have some investments maturing) - but what is 'savings'?? Investments clearly are.

Investments aren't savings, they are investments. For the purposes of the question, however, that is an irrelevant distinction.

Savings are any sum of money that you have that is not committed to expenditure.

Somerset_La_La_La wrote: »

However - say you are paid £1,000 (and they put the app through). Move £500 away to another account as you intend to "save" it. You then move it back (a minute, hour or day later - since you need to 'spend' the 'savings'), that should still be savings. There is no rule that income needs to be deposited for X days to then count as 'savings'.

???

Nobody said otherwise.

Somerset_La_La_La wrote: »

All HSBC Group do by asking the intended source etc is take customer profiling to another level. All other banks INTEND that you use it as your main account (2 direct debits, 5 star jumps, £750 in a month, a debit card transaction, use online banking....) so the same immoral argument could be made for people with multiple accounts.

You are confusing morality with legality.

They actually ask about source of funding because they are required to as part of Know Your Customer. They have responsibility in law to detect and prevent money laundering.

Somerset_La_La_La wrote: »

Edit: Regarding "length of time at bank". I take this to mean my "main" bank. What people deem to be a main bank can vary - is it where your salary goes? The one you visit in person most often? The one you are considering for your mortgage/credit card/loan? The one you've had the longest?

If you are switching an account then it is the length of time you have been with that bank. Otherwise it would be a meaningless question, but the answer for your longest banking relationship would be appropriate.

Somerset_La_La_La wrote: »

I take it to be longest, since that's the rapport/relationship built up. Somebody else could take it to mean where the salary goes (Which could be a very different account). As long as you're consistent and have clear reasoning (and the account you are referring to is still open) then again you aren't committing fraud.

Neither I, nor anyone else, said that you would be.

Answering the questions honestly prevents all of this hand-wringing.

Somerset_La_La_La wrote: »

Although Banks play judge, jury and executioner regarding CIFAS markers with very limited scope for appeal and big consequences if they slap you with one! But, my reasoning is my Lloyds account is my main account - open longest, and they give me free cinema tickets - but DON'T have my salary paid in. If they want to dispute that declaration with me in court or up to the FOS then they can do.

Okay.

EachPenny

Somerset_La_La_La wrote: »

The bold bit - really?? You can intend to pay your net salary in and then not do so for a variety of reasons - for example: my employer, despite me asking them twice and updating it on the self service portal, have still not updated my salary destination. Two months later it is still going to my "old" bank account. So am I committing fraud by not paying my salary into what is supposed to be my new main account?

I agree with you, although I maintain the position I stated at the start of the thread that the OP (and anyone else planning the same thing) shouldn't deliberately lie on an application form.

The amount of money you earn is a factual piece of information. Your intention to pay that money into an account is a decision you are free to reconsider at any time, unless you've entered into some form of contractural arrangement with the bank that you will do so.

The issue of changes in circumstances in the next two years is a red herring in this regard. Anyone opening a bank account today could reasonably foresee the possibility that they might want to pay their salary into a different bank account within the next two years and by the logic being suggested ought to declare this possibility. There are also countless other changes in circumstance which could be similarly foreseen making it virtually impossible for anyone to truthfully answer 'no' to that question if such a pedantic approach were adopted in reality.

Completing the application form stating that you intend to pay your salary in when you have no such intention is fraud.

Completing the application form stating that you intend to pay your salary in, but changing your mind ten minutes later, is not fraud. In those circumstances you might want to contact the bank and inform them you've changed your mind, but that would depend on the precise circumstances in which it happened.

It is a grey area, and people won't be helped if they are led to believe they are being rejected because they are not attractive enough as customers and therefore conclude they need to lie on applications in order to be approved.