If I switch banks will it affect ease of getting future loans?

I have held a current account with a certain bank for the past ten years. Until recently there was never more than a couple of hundred euro in it.

When I started full-time employment two years ago I used this current account for my wages. I have four direct debits associated with the account. I have an average of €900 - 1200 entering the account weekly. I never keep more than €500 in it at any time because I transfer money to my high interest accounts(different banks) as soon as my wages enter the current account. I also have a credit card and an outstanding loan with two years left to run with the bank. Its a fixed rate loan. I want to leave this bank as I am of the opinion that my confidentiality has been breached.

What would be the best procedure for closing my current account and opening a new current account with a different bank? I have four direct debits coming out my current account right now. Will I have to notify each of the direct debit companies or can I sort of port my account over to another bank, and let them do all the work, like you would when changing from vodafone to o2? Wages shouldn't be a problem as I can notify work of my new bank details.

With regards to my credit card if I cancel it and apply for one with my new bank, should I assume that they'll automatically grant me one, bearing in mind that my current credit card is a student one with a limit of €400. I use it maybe twenty times a month so I am forever transferring money into it as its hard to tell what I owe as some of the transactions don't show up for days. At any time I may owe the bank €400 or I may have a surplus of €300 because I loaded €300 into the card to bring my limit up to €700. How would this be looked upon?

The issue with the fixed rate loan, I take it I can just move the loan direct debit over to my new bank? The repayments are approximately €300 per month with 24 months left to run. As its fixed rate, I guess I would not save any money paying it off early, plus the repayments are extremely manageable whereas I'd feel the pinch in the short term if I cleared it entirely.

I'm in my early twenties, so I'll probably need a mortgage in the next couple of years, and a personal loan in the next six months. My question is will it be harder to get either a personal loan or mortgage from my new bank if I am a relatively new customer? i.e, with them three to four months before I apply for a loan.

Hi Krew Bot,

From reading your post I believe any bank will be delighted to have you as a customer.

There now exists a 'switching code' between banks which is designed to faciltate exactly what you want to do in terms of switching your current account from one provider to another (this will also take care of the direct debits for you).

What I'd suggest is that you print off your original post, and bring it to the bank you'd like to move to and discuss with a staff memeber there.

I'd suggest you open your new account and get your atm card etc before you send through the 'switch' instruction, doing this will ensure you aren't left without a banking service for any period. I'd also suggest you apply for a credit card with your new provider (or any other provider for that matter) - but again I'd do this before I'd close the existing card, again to ensure you aren't left without the service.

In terms of loan or mortgage, as long as you can show repayment capacity for same you won't have an issue. I would suggest you discuss these issues when you go to switch your account, as it is important to establish your relationship with your new provider right from the start.

Hope that's of some help.

Best of luck.

BM

Krew Bot - who is your existing current account with now and who are you thinking of moving to? Hopefully you have considered the Halifax current account which, among other things, pays 10% on balances of up to €2K subject to you lodging at least €1,500 p.m. to the account (e.g. salary mandate).

Thanks for the information. I am currently with Bank of Ireland, I was thinking of perhaps moving to AIB but I am definitely open to suggestions. A good online banking system would be high on my priorities as I travel a lot and I rarely have the time to go into a branch.

Krew Bot said:

Thanks for the information. I am currently with Bank of Ireland, I was thinking of perhaps moving to AIB but I am definitely open to suggestions. A good online banking system would be high on my priorities as I travel a lot and I rarely have the time to go into a branch.

Click to expand...

Hi there Krew Bot

Perhaps you should take at look at this thread.

Perplexed (eventually outed as a BoI employee ) attempts to gently nudge Raul to retain a relationship with BoI, but I think the T&C's are on Halifax's side.