Beware of the Free Checking Account Teaser Offers

One of the things that I have been seeing more andthis because the process of switching my direct
more of these days is the teaser offer by banks todeposit information with my employer was much less
open up a checking account with them. The mostthan an easy process. You may want to ask your
effective ones offer you straight cash, but I haveemployer about this before doing so. And if you
seen them offer anything from gift cards to justforget to switch it back, you may find yourself with
about anything else you can think of.not enough money in your regular bank account to
Of course, the first thing that comes to my mind iscover your bills.
to open up the checking account, fulfill anyDon't forget about them! As I said, I opened up my
requirements they have for the free money, get thethree accounts, fulfilled the requirements, got my
free money and then forget about the account.cash reward, withdrew most of the money out of
That's not what the bank has in mind but so what.the account and forgot about them. Another
Several months back, I went ahead and applied forrequirement may be that you leave the account
three separate offers for these accounts, and I justopen for a certain period of time to qualify for the
wanted to let you know how my experience went. Ireward. Forgetting about them can be dangerous.
think I ended up making $250 cash from all three ofWith two of these accounts, I recently received
them combined. In short, you can obviously makeoverdraft notices. They charged me an "inactivity
free money with these deals, but you have got tofee" which put my accounts at less than zero
be careful.balances, triggering more late fees, and two big
Listed below are just a few of the things you needmesses in general. It took a lot of phone calls and
to be aware of before diving in. When weighedfast-talking to straighten out.
against the $250 that I made, it is worth it, you justEase of closing: Do not think that these banks are
need to stay on top of it.unaware of the people out there like me - who are
Here goes:only really in it for the cash reward. They know we
Affect on your Credit Score: I did not track this as aexist, and they will make it as difficult,
before and after thing, but there will be a minortime-consuming and annoying as possible when it
effect on your credit rating. Sometimes, thesecomes time to close these accounts. In general, it
accounts can be opened without a "hard pull" on yourcannot be done with a simple phone call. Plan on
credit, but those I think are few and far between. Itinvesting a good deal of time on the back end to
probably takes six months or so for your score toclose this stuff out.
recover. In the interim, you may have some difficultyOverall, I would say it was definitely worth the
if you try to open up any other new lines of credit,money I made by signing up for these offers. I only
as I did. No long term and no major effects, justwish I was a little better informed about a few
something to be aware of.things, and had stayed a little more organized on the
Direct Deposit Requirements: Some of these offersback end. This would have made my life quite a bit
require at least one direct deposit to qualify for youreasier.
cash reward. I would be wary of these. I only say