Northern Bank Direct MM - 2.26% APY

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geospatial
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Northern Bank Direct MM - 2.26% APY

Post by geospatial » Wed Jun 13, 2018 10:51 am

https://www.depositaccounts.com/banks/n ... ct/offers/
Interest rate is guaranteed through June of next year. Minimum opening contribution = $5000. Max of $250,000.

The comments are useful to gauge individual's experiences opening up an account and a discussion of the various fees. I just tried the online application, entered all the necessary information, but got an error message saying it couldn't process at this time and to call their CS number. I did so, and they said it was just a system problem (they're probably getting slammed with new account requests) and they were opening up a case for me to get approval and would email me with the results of that soon. I specifically asked if there was a hard or soft credit pull and they said soft, so the freeze I have on my Chexsystems report wasn't the culprit. I'll try to update this post/thread as things go along if there is further interest. Seems that FDIC protection along with liquidity makes this superior to most of the 1-year CDs out there currently.

tenkuky
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Re: Northern Bank Direct MM - 2.26% APY

Post by tenkuky » Wed Jun 13, 2018 5:18 pm

There appears to be a $3 charge for ACH each time if initiated from Northern.
And a $10 close out fee.
Otherwise another great deal thanks to Kevin.
Please update with your opening experience.

NOLA
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Re: Northern Bank Direct MM - 2.26% APY

Post by NOLA » Wed Jun 13, 2018 5:48 pm

Thank you for the heads up! Will have to check it out.

geospatial
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Re: Northern Bank Direct MM - 2.26% APY

Post by geospatial » Thu Jun 14, 2018 3:07 pm

Update: I received a form letter email today stating the following...
Hello,

Unfortunately at this time we will not be able to process your application. We will be sending a letter in the mail with further information on this matter.

Thank you,
I emailed back to see if I could get clarification sooner and got a reply stating that a freeze on my ChexSystems account prevented the approval process from proceeding. When I spoke to the CSR yesterday though, they said the bank performs a soft pull and didn't think the freeze would prevent it. Apparently not. So it looks like I'm going to request a temporary lift of my ChexSystems freeze and see how to get the ball rolling again.

tenkuky
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Re: Northern Bank Direct MM - 2.26% APY

Post by tenkuky » Fri Jun 15, 2018 3:57 pm

Thanks for the update.
Ugh, not sure I want to deal with this.

geospatial
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Re: Northern Bank Direct MM - 2.26% APY

Post by geospatial » Fri Jun 15, 2018 4:06 pm

I either never got my Chex Systems PIN or misplaced it (personally I think it's the former), so I've had to request a PIN change and they only send it via snail mail. Tried to call Chex today to confirm my fax request was received... twice. But it became obvious they outsource their customer service and both times they claimed their systems were down. So it is turning into a bit of a hassle. But I'm going to persist and go through with it regardless. I suspect it would have been much simpler if I hadn't gotten the freeze in the first place or had the PIN available to do the temporary freeze lift. Another reason I'm comfortable doing this is that I'm actually a reasonable car drive away from the bank's HQ, so could always show up in person if there are any future issues... a perk over the non-brick-and-mortar options we mostly have these days.

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BrandonBogle
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Re: Northern Bank Direct MM - 2.26% APY

Post by BrandonBogle » Fri Jun 15, 2018 4:31 pm

geospatial wrote:
Thu Jun 14, 2018 3:07 pm
Update: I received a form letter email today stating the following...
Hello,

Unfortunately at this time we will not be able to process your application. We will be sending a letter in the mail with further information on this matter.

Thank you,
I emailed back to see if I could get clarification sooner and got a reply stating that a freeze on my ChexSystems account prevented the approval process from proceeding. When I spoke to the CSR yesterday though, they said the bank performs a soft pull and didn't think the freeze would prevent it. Apparently not. So it looks like I'm going to request a temporary lift of my ChexSystems freeze and see how to get the ball rolling again.
The CSR had me email a picture of my driver's license. We didn't speak about pulls or freezes, but I do have the major credit bureaus frozen and my ChexSystems too.

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Kevin M
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Re: Northern Bank Direct MM - 2.26% APY

Post by Kevin M » Sun Jun 17, 2018 2:15 pm

I was wondering if this account could be set up as payable on death (POD), as I want most financial assets either owned by my trust or using POD. I found this in their FAQ:
Can I designate a beneficiary?

Beneficiaries may not be added to the account during the account opening process. Once the account has been opened and funded, Northern Bank will mail out signature cards and disclosures to the address provided. You will need to complete and return the signature card to us regardless of whether or not you want to add a beneficiary. If you want to add a beneficiary, also complete the beneficiary form and return it with the signature card. Once we receive both forms back, we will mail out a revised signature card with the account titled as a Totten trust account with named trustee(s) and beneficiary(ies) for you to sign and send back to us. The account will not be updated with the beneficiary information until we have received the updated signature card back. If you have any questions, please contact us regarding this process.
So apparently it is doable, but in kind of a cumbersome way.

So I think I would start by funding with the minimum amount of $5,000, then add more after the beneficiaries are set up.

Kevin
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mrc
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Re: Northern Bank Direct MM - 2.26% APY

Post by mrc » Sun Jun 17, 2018 3:42 pm

Be sure you can initiate transfers from another bank, the daily/monthly limits on external transfers from NBD out are $K/$25K.
If you initiate the electronic transfer from your Northern Bank Direct account, there is a maximum daily limit of $5,000.00 (or the available balance in your account, whichever is less) for Interbank (external) transfers per transaction; $5,000 in aggregate per day; and $25,000 in aggregate per calendar month. The maximum number of transfers is 10 per day and 100 transfers to your account per calendar month. Please refer to the Electronic Funds Transfer Disclosure and the Online Banking Agreement.
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Kevin M
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Re: Northern Bank Direct MM - 2.26% APY

Post by Kevin M » Sun Jun 17, 2018 7:15 pm

mrc wrote:
Sun Jun 17, 2018 3:42 pm
Be sure you can initiate transfers from another bank, the daily/monthly limits on external transfers from NBD out are $K/$25K.
If you initiate the electronic transfer from your Northern Bank Direct account, there is a maximum daily limit of $5,000.00 (or the available balance in your account, whichever is less) for Interbank (external) transfers per transaction; $5,000 in aggregate per day; and $25,000 in aggregate per calendar month. The maximum number of transfers is 10 per day and 100 transfers to your account per calendar month. Please refer to the Electronic Funds Transfer Disclosure and the Online Banking Agreement.
This is not unusual, which is why it's advisable to have a good hub bank, like Ally, that has very high ACH limits. Also, once you set up the external link from Vanguard (or Fidelity or other broker) to NRB, you can buy or sell shares of your money market fund to get large amounts of cash in and out of this bank or any other.

If I proceed, the initial $5K deposit would come from Ally. Then I would link NBD to Vanguard, since most of my cash is there now. Once that link is verified and the hold period is up, I would sell shares of my Vanguard MM fund, specifying NBD as the destination bank.

Kevin
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BrandonBogle
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Re: Northern Bank Direct MM - 2.26% APY

Post by BrandonBogle » Mon Jun 18, 2018 12:19 pm

BrandonBogle wrote:
Fri Jun 15, 2018 4:31 pm
geospatial wrote:
Thu Jun 14, 2018 3:07 pm
I emailed back to see if I could get clarification sooner and got a reply stating that a freeze on my ChexSystems account prevented the approval process from proceeding. When I spoke to the CSR yesterday though, they said the bank performs a soft pull and didn't think the freeze would prevent it. Apparently not. So it looks like I'm going to request a temporary lift of my ChexSystems freeze and see how to get the ball rolling again.
The CSR had me email a picture of my driver's license. We didn't speak about pulls or freezes, but I do have the major credit bureaus frozen and my ChexSystems too.
Got an email today from them thanking me for my driver's license photo, but saying they need me to lift my ChexSystems freeze before they can continue.

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Kevin M
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Re: Northern Bank Direct MM - 2.26% APY

Post by Kevin M » Mon Jun 18, 2018 5:01 pm

First time through online application, it failed, and said to call. Called, and was told it was because of security questions, which I had suspected. Only thing to do is try again (they can't do anything by phone), so I did, and it worked second time through.

Now waiting for the trial deposits to verify initial funding account, then stuff in the mail so I can set up beneficiaries.

Kevin
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Kevin M
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Re: Northern Bank Direct MM - 2.26% APY

Post by Kevin M » Tue Jun 19, 2018 1:56 pm

Trial deposits/withdrawals hit my Ally checking account today, so I was able to complete the account setup with no glitches. Next step is for them to pull the initial $5K deposit from my Ally checking account. Since the trial deposits took one business day, I assume that will happen tomorrow.

Note that although I have freezes on credit reports, I do not have a freeze on ChexSystems, so that did not cause any issues for me. I did not have to provide a drivers license photo or anything else beyond what I filled out in the online application to get the account open.

Next steps are to receive the paperwork, designate beneficiaries, mail it back, wait for the account to be re-titled as POD (Trotten trust), and set up links from external financial institutions.

Regarding the latter, since this is a money market account, only six withdrawals per month are permitted without paying a fee. Depending on the process, either one or two withdrawals will be used up for the trial deposit/withdrawals in linking from an external account. Ideally, I want to set up links from Ally, Vanguard and Fidelity, but doing all three could use up all my withdrawals for the first month, and don't want to do that.

NBD will essentially serve as a third-tier savings account for me.

Tier one is Ally Bank checking and savings, as this provides the most liquidity; e.g., I can use Zelle to transfer money to other people instantly. Of course it has the lowest rate on savings, 1.65%, so don't want to keep too much cash there. Although Ally savings has the same six per month limit on withdrawals as any other savings or bank money market account, I have two savings accounts, giving me 12/month, and I can batch transfers from savings to checking, then use checking for unlimited transfers out.

Tier two is Vanguard Treasury MM fund, which currently has taxable-equivalent yield for me of 2.02%. It takes one business day to transfer between there and either Ally or Fidelity, and of course there is no limit on the number of outbound transfers. Currently this is the account that feeds Fidelity for purchases of Treasuries or munis, in addition to feeding Ally to keep the most liquid cash reserves at target.

So I want to keep enough at Ally to meet unexpected needs where I might not need or want to wait one business day for access to the cash. I'll probably want to keep enough in the Vanguard MM fund for possible upcoming purchases of Treasuries or munis at Fidelity. I'll want the bulk of cash at NBD, reserving the six monthly outbound transfers for unexpected larger cash needs, or to add to the reserves at either Vanguard or Ally.

Vanguard puts a 7-10 day hold on new banks before you can do outbound transfers to them (you can do inbound transfers as soon as the trial deposits are verified). This would be a negative for setting up a link from Vanguard to NBD first. However, it may take that long to get the NBD account set up as POD.

Since it only take one business day for transfer between Ally and either Vanguard or Fidelity, I'm thinking that I'll set up the link from Ally to NBD first.

I know this all sounds ridiculous to many folks, as the dollar amounts from the extra yields are not very large, but I kind of enjoy it. I'd rather be having fun with this, earning a few extra dollars, than doing crossword puzzles.

Kevin
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