Can you switch and then leave for the free money?

slhqoue

Hi there,

I have been reading this page: https://www.moneysavingexpert.com/banking/compare-best-bank-accounts

I'm a First Direct customer and am considering switching to the Halifax Reward account to get the free £150. I already have a Halifax Clarity Credit Card and my mortgage with Halifax.

It seems as though the money is paid within 10 days of switching.

Am I OK to switch from First Direct, get the money, and then immediately switch back to First Direct?

sienew

slhqoue said:

Hi there,

I have been reading this page: https://www.moneysavingexpert.com/banking/compare-best-bank-accounts

I'm a First Direct customer and am considering switching to the Halifax Reward account to get the free £150. I already have a Halifax Clarity Credit Card and my mortgage with Halifax.

It seems as though the money is paid within 10 days of switching.

Am I OK to switch from First Direct, get the money, and then immediately switch back to First Direct?

Yes, you can do that. Opening and closing accounts will affect your credit rating though so just be careful of that.

changearound1

When you switch back to First Direct you'll be ineligible for their switch offer as you'll have previously held a current account with them.

You could switch from Halifax to Nationwide / Santander / Virgin for their switch offers.

slhqoue

Thanks both. I quite like First Direct so would be switching back in part for their 3.5% regular saver. I've already saved 2 month's in this (£600) which I assume I'd just lose all the interest on if I switched and therefore the account closed early automatically.

Daliah

sienew said:

slhqoue said:

Hi there,

I have been reading this page: https://www.moneysavingexpert.com/banking/compare-best-bank-accounts

I'm a First Direct customer and am considering switching to the Halifax Reward account to get the free £150. I already have a Halifax Clarity Credit Card and my mortgage with Halifax.

It seems as though the money is paid within 10 days of switching.

Am I OK to switch from First Direct, get the money, and then immediately switch back to First Direct?

Yes, you can do that. Opening and closing accounts will affect your credit rating though so just be careful of that.

It can technically be done but as the OP is an existing FD customer, they won't get any switch bonus from FD. Depending on when they opened their existing FD account, they are probably outside the leaving bonus window, too. So it would all in all be a bit of a pointless exercise.

Credit rating is, as has been discussed here frequently, a rather meaningless indicator. It is correct that most current account applications involve a hard search, and a large number of hard searches in a small amount of time could impact your ability to obtain large credit - e.g. mortgages or large loans. If you have no plans to get any of these in the next 6-12 months, hard searches don't matter at all as they drop off your credit file after 12 months, anyway. I am of the view that even one or two hard searches older than 6 months won't make a difference to your ability to obtain credit.  

eskbanker

slhqoue said:

Thanks both. I quite like First Direct so would be switching back in part for their 3.5% regular saver. I've already saved 2 month's in this (£600) which I assume I'd just lose all the interest on if I switched and therefore the account closed early automatically.

In your shoes I think I'd leave the FD current account well alone and simply open a sacrificial account elsewhere to use for switching into Halifax - there is no guarantee that FD would accept an application from someone who'd very recently switched away, so why risk it if that's where you want to stay?

slhqoue

Would it be a pointless exercise? I'd get £150 from Halifax  - and another £160 from Santander if I did a Halifax-Santander-First Direct switch.

The point of switching back to FD is that I actually want to bank with them.

slhqoue

eskbanker said:

slhqoue said:

Thanks both. I quite like First Direct so would be switching back in part for their 3.5% regular saver. I've already saved 2 month's in this (£600) which I assume I'd just lose all the interest on if I switched and therefore the account closed early automatically.

In your shoes I think I'd leave the FD current account well alone and simply open a sacrificial account elsewhere to use for switching into Halifax - there is no guarantee that FD would accept an application from someone who'd very recently switched away, so why risk it if that's where you want to stay?

Thanks @eskbanker, can you explain what you mean by a sacrificial account? Don't most banks require you to pay in cash to them and set up Direct Debits? How would you go about this?

slhqoue

Hi again @eskbanker, also would it be risky to do this by setting up a Halifax current account? I could easily do this I think as I already have a credit card, ISA and mortgage with them. Would I be able to use this as a 'sacrificial' account or would it have an impact on my other accounts with Halifax? Thanks again for your help.

Rob5342

The only risk really is that the banks you switch away from may not accept you back againt later. They probably wouldn't reject you forever but they may impose a time limit before you can open another accout.

If you want to keep banking with First Direct then I'd keep that account open, and as suggested open a donor account with a bank that never offers switch incentives, manually move two direct debits to it, and switch that through all the banks with switch offers until you run out of banks,

Bridlington1

One option is open 3 Halifax accounts and an account with a bank that doesn't usually run switching offers e.g. Barclays. Set up 2 DDs on the Barclays account and 2 DDs on 2 of the Halifax accounts. Switch Barclays to Halifax, one Halifax account to Santander, the other to Nationwide and once you have the £150 from Halifax switch that account to Virgin Money.