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Churning Bank accounts for sign-up bonuses

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Churning Bank accounts for sign-up bonuses

I am currently thinking about moving my different savings accounts around to get sign up bonuses. Currently I have a decent amount of savings in Alliant and am planning to move it to Discover Savings to get their sign up bonus. It looks like the bonus will be paid by the beginning of October, no account has zero monthly fees, and I don't need to hold it there longer than that. Are there any downsides to this other than the labor required to shuffle around accounts?

 

I recently opened a Chase checking account to build my relationship with them to get into the Chase CC UR ecosystem but plan on keeping the money there. When the Discover Savings account returns it's SUP, I am considering to to move it to Chase. The Chase bonus is a bit more strict as you need to have the money in the account for 6 months or you return your SUP.  Downside to Chase, is the interest rate is terrible on their basic savings but I plan on moving the money out the 6 months back to my Alliant or another high yield savings (unless I'm chasing another SUP).

 

tldr;chasing sign-up bonuses, are there any downsides? I need to be liquid in the next year or so, have stocks, and 401k/IRA retirement accounts.

 

 

Message 1 of 28
27 REPLIES 27
Community Leader
Mega Contributor

Re: Churning Bank accounts for sign-up bonuses

Downside is that depending on how many you open, you may not be in position to do so again for a while. 

 

Chase will report opening and closing to EWS. Other large banks that use it will eventually say no because after you do this a few times, the purpose becomes obvious. Some are willing to tolerate it, others are not. 

 

For ones that use Chex, get enough inquries and you'll hear NO a lot, especially from CUs. 

Again, they are not stupid. Bonuses are great, but losing money is not so great for them 

 

So, slow down the rate at which you're planning to do this. 

 

Or conversely, just go for it and see what happens. Data points are always appreciated. 

 

 

EX 759 EQ 774 TU 753


Message 2 of 28
Frequent Contributor

Re: Churning Bank accounts for sign-up bonuses

Good to know, thanks. Perhaps if I leave a bit of money on each account and not close them it should be okay? Or will they still flag that I’m opening so many accounts.
Message 3 of 28
Community Leader
Mega Contributor

Re: Churning Bank accounts for sign-up bonuses

Best is to pace yourself. Maybe two a year. If you leave a little bit, you'll end up paying fees as most of those accounts have requirements such as maintaining x amount, direct deposit etc in order to waive the fee. If you pay fees, there goes your bonus. 

 

You can keep going till you get your first no, but also you need to be aware that at that point, you'll have to wait quite a bit

Chex retains inq for a long time, but most lenders are concerned with last year or two 

 

 

EX 759 EQ 774 TU 753


Message 4 of 28
Valued Contributor

Re: Churning Bank accounts for sign-up bonuses

I’d also run the numbers versus just leaving that money parked in a decent savings accounts. You’ll typically find that the return works out to only hundreds of dollars per year over interest leaving it parked, with the aforementioned risks of being labeled a churner.

Personally, hundreds of dollars for the extra time, effort and risk is not even remotely worth it to me. Only you can answer if it’s worth it to you.
Message 5 of 28
Frequent Contributor

Re: Churning Bank accounts for sign-up bonuses

The Chase Savings is $200 plus $100 if you do both the checking and savings. 6 months @ 2.00% is about $173. So $300-173. Worth it? Maybe not as much as I initially thought. Chase Savings requires a daily balance of $300 to avoid fees (easy) or an automatic transfer from checking to saving once a month (easy/minimum $25). Chase Checking, I am keeping regardless requires $500 monthly direct deposit (already done) or minimum daily balance of $300 or more.

 

However, the Discover is a month or so turnaround is while not a no brainer, a much better gain for a month of money movement. Zero fees with the Discover card.

Message 6 of 28
Senior Contributor

Re: Churning Bank accounts for sign-up bonuses

One big limiting factor to churning bank accounts is that so many banks are sensitive to new accounts as reported by Chexsystems.  In some cases 3-4 accounts opened over the last 12 months will trigger a denial. 

 

In some cases if you're applying in-branch at a local bank they may override but in most cases a denial won't be reconsidered. 

 

In some cases you'll be able to open an account online but upon manual review within a few days the account will be closed and your deposit returned. 

 

It can be fun but it isn't a lucrative endeavor. 

 

 

 

(8/2019)
FICO 8 (EX) 793 (TU) 808 (EQ) 794
FICO 9 (EX) 822 (TU) 827 (EQ) 844

$800K+ club
Message 7 of 28
Community Leader
Mega Contributor

Re: Churning Bank accounts for sign-up bonuses

Not to mention future denials over "previous unsatisfactory relationship" 

 

Also, you're rebuilding, with only 8 months history. Dont burn bridges over $300 before you've even walked on them. 

UW at US Bank had my EWS report available during recon for my first card with them,  and it was my only saving grace as I seldom open checking/savings accounts, so while my CR looks like I might be ready to rob the world, at least that one was clean as a whistle.

 

I think you've made up your mind already so good luck! 

 

 

EX 759 EQ 774 TU 753


Message 8 of 28
Frequent Contributor

Re: Churning Bank accounts for sign-up bonuses

Definitely good points. Wanted to ask before I started churning multiple accounts. Thank you for your advice. For Chase, I have mentioned I want to establish a relationship with them. Based on this knowledge, if I do open a savings account, it would be safer to leave the money in there in the long term.

FWIW, In the last 20 years, I have been with Wells Fargo and opened with Alliant as a savings last year.
Message 9 of 28
Frequent Contributor

Re: Churning Bank accounts for sign-up bonuses

I think this is DaveinAZ's current cup of tea, maybe he will chime in soon!!

 

As for me, it has also become my latest interest. So far, for me:

 

Regions Bank - $400

Chase Bank    - $600 (Currently in the works)

Citibank           - $500 (Planned for  later this month)

Fifth Third       - $500 (Planned for Oct)

 

I do agree I am taking the risk that all the other posters have mentioned. Other than Chase, I have no intentions of having any kind of relationship with any of the banks that I churn. As with Chase, that does happen to be in 2nd player mode, and she(DW) will probably keep that account active for herself.

 

My current list takes me into Jan 2020, and than I will see what the new year brings me. Maybe some denials? We'll see!!!

 

    EQ=846        TU=834        EX=822      INQ=0/0/2      UTIL=1%        AZEO
Message 10 of 28
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