Any downside to opening multiple bank accounts?

Kurisu

I'm looking to remortgage late 2023 and a number of lenders i.e. HSBC, Lloyds, Halifax have deals that are only available for current account holders. 

Do you think there will be any downside to me opening a basic current account with each of the above banks simply to increase my chances of being able to apply for one of their deals in the future?

TIA, Chris 

DullGreyGuy

Only real downside is that having opened such accounts you wont be a new customer to them in the future if they have switching bonuses etc. Also double check the small print on the requirements for getting the existing customer preferred rates as a basic account or only having it for 6 months may not be sufficient.

Band7

The banks you mention will carry out hard credit searches when you apply for a current account. These searches remain on your credit files for about a year. When you apply for a mortgage, the lender may or may not hold those credit searches against you.

You'll probably get better info on https://forums.moneysavingexpert.com/categories/mortgages-endowments

Also worth checking: https://moneyfacts.co.uk/mortgages/

Nebulous2

One little known minor downside, is setting off theft alarms, in supermarkets. I was carrying so many cards that I regularly set off the alarm in supermarkets and got challenged by security guards.

Easily enough resolved by leaving most of them at home..... 

blue.peter

It's worth bearing in mind that the accounts for which you apply may have conditions applying to them - for example, a minimum monthly amount to be paid in, or a minimum number of DDs. Some banks expect or require that current accounts show evidence of regular and/or reasonably frequent use. You're going to have to meet any such obligations for all accounts that you have. Whilst these obligations aren't usually terribly onerous, they do imply an administrative overhead, and that overhead increases with each account that you run. You're going to have to, for example, set up standing orders to move money around to meet minimum amounts paid in, and I'd expect you to want to keep a watchful eye on all accounts to ensure that everything is operating as expected.

Oh, and you'll need to be careful that you know each bank's definition of "month" where this is relevant. Not all banks work to calendar months. Santander, for example, says this in its KFD for the 1|2|3 current account:

The appetite for the necessary administration varies from person to person. Some people are happier running multiple accounts than others.

Band7

blue.peter said:

It's worth bearing in mind that the accounts for which you apply may have conditions applying to them - for example, a minimum monthly amount to be paid in, or a minimum number of DDs. Some banks expect or require that current accounts show evidence of regular and/or reasonably frequent use. You're going to have to meet any such obligations for all accounts that you have. Whilst these obligations aren't usually terribly onerous, they do imply an administrative overhead, and that overhead increases with each account that you run. You're going to have to, for example, set up standing orders to move money around to meet minimum amounts paid in, and I'd expect you to want to keep a watchful eye on all accounts to ensure that everything is operating as expected.

Oh, and you'll need to be careful that you know each bank's definition of "month" where this is relevant. Not all banks work to calendar months. Santander, for example, says this in its KFD for the 1|2|3 current account:

The appetite for the necessary administration varies from person to person. Some people are happier running multiple accounts than others.

Very few, if any, ‘basic’ current accounts have any minimum deposit or DD requirements. You only need these if you want rewards or if you opt for packaged accounts.

By ‘basic’, I mean general accounts with bare current account functionality, not accounts that are offered when you don’t pass the bank’s credit checks.

DullGreyGuy

Nebulous2 said:

One little known minor downside, is setting off theft alarms, in supermarkets. I was carrying so many cards that I regularly set off the alarm in supermarkets and got challenged by security guards.

Easily enough resolved by leaving most of them at home..... 

Dont generally carry any cards with me but instead use contactless with my phone... in the 11 months of doing so only had two occasions where it caused any problem because the systems werent working and were either cash only or C&P only

Arwen

Nebulous2 said:

One little known minor downside, is setting off theft alarms, in supermarkets. I was carrying so many cards that I regularly set off the alarm in supermarkets and got challenged by security guards.

Easily enough resolved by leaving most of them at home..... 

I didn't know this! Probably reason why I am constantly setting off alarms. I'll stop taking them with me.

phillw

blue.peter said:

You're going to have to, for example, set up standing orders to move money around to meet minimum amounts paid in, and I'd expect you to want to keep a watchful eye on all accounts to ensure that everything is operating as expected.

I've never used a standing order for sending money between accounts, some banks will send standing orders on a saturday and others won't. With the amount of hassle involved if one doesn't fire, I might as well login to the accounts on my phone and transfer them manually.

I have moved all my DD to the start of the month & have setup all my accounts with open banking so I can just login to one app to see all the balances (I currently use lloyds).

If you open a lloyds account, you might as well make it a club lloyds. The 6 free cinema tickets alone make it worth the minutes per month it takes for admin.

blue.peter

phillw said:

If you open a lloyds account, you might as well make it a club lloyds. The 6 free cinema tickets alone make it worth the minutes per month it takes for admin.

That's a very personal assessment. It might be true for you, but it isn't for everyone. It depends how often you go to the cinema. I think that the last time I did was when my niece asked me to take her to see Mamma Mia. That'd have been in about 2008, wouldn't it?

flaneurs_lobster

Re: Club Lloyds, don't take the movie rental reward. Turns out that Rakuten have a rubbish film selection and no Firestick app (I discovered today). And you can't change to another reward for a year.