Help with bank accounts

sufcboy

Hi all. I apologise in advanced if this is posted in the wrong section. However I’m just wanting a bit of advice with regards to bank accounts.

First of all, I have a first direct current account, which I’m wanting to close as I only opened for the free gift which I have now got. Does closing accounts affect your credit score?

Secondly with regards to the accounts that offer ‘free £150’ etc for opening an account. What are the restrictions on these? As I’m guessing you just can’t open them for the free incentive, then close the account and move on to the next provider?

Thanks for the help

MovingForwards

Credit score - yes, but sneezing also affects mine. It's your credit history you need to concern yourself with as the number isn't used by financial companies.

Restrictions - read the T&C's as it will say what they are. We do not know who you are looking at opening an account with.

sufcboy

So would closing and opening another account be bad for my credit history. Am I better just leaving the account open with no money in it?

PRAISETHESUN

I wouldn't worry about your credit "score" as this is mostly just a marketing gimmick produced by the CRAs to get you to buy their paid services. The score is not seen by lenders and is not an indication of creditworthiness. Lenders will judge you based on your credit history, so what matters most is having a good record of managing credit responsibly.

Opening and closing accounts in rapid succession is usually seen as a bad thing by lenders for two reasons: firstly, it makes it seem like you are desperate for credit, and secondly, they like to see stability. That said, a search every few months isn't the end of the world and should be the only reason holding you back if you want to go down the multiple current account route.

There is nothing to stop you doing as you propose - just make sure to contact First Direct before you leave to confirm that you are eligible for the "goodbye" gift. You will need to closely study the T&Cs for the account you are proposing to switch to, but in general most accounts will clearly state either way how long you need to keep the account open after the bonus is paid: some banks require a minimum period whilst others will let you close the account as soon as the bonus is paid -although in some cases they might state they'll pay the bonus after XX months after the account is opened (eg. First Direct) after which you'd then be free to leave when it is paid

sufcboy

The thing I’m looking to buy a house at the start of next year so don’t want to damage my mortgage chances. Ideally I’d like to close the first direct account, as I have no use for it anymore.
And also switch my main Barclays everyday debit account to something with free cash incentive and that would be all for a few years.
Would this have a impact on my mortgage chances?

MovingForwards

You need to show long term stability with a current account, if you are opening / closing them every year how is that showing stability?

If you want a mortgage have a think about what are your oldest accounts, current account and credit cards are they fairly new or over 5 years.

Robin9

Switch if you can meet the requirements of the new account - pay in £1500 two DD's etc. You never know when your other account might get frozen.