Posted by Chuck on January 27, 2016
Checking Accounts

Published on January 27th, 2016 | by Chuck

49

Destinations Credit Union: 3% Reward Checking Account, Up to $10,000

[Originally posted on 12/28/15, reposting on 1/27/16 since multiple data points came in that it’s only a soft pull.]

Offer at a glance

  • Interest Rate: 3.01% APY on balances up to $10k
  • Additional Benefits: ATM fee refunds
  • Minimum Balance: None
  • Availability: Nationwide; must make $25 donation to Red Cross to join [Update: It appears that the Red Cross option has now been limited to MD and DE, so this may no longer be nationwide.]
  • Direct deposit required: None
  • Additional requirements: Yes, 12 debit card purchases
  • Hard/soft pull: Soft
  • Credit card funding: Up to $1,000
  • Monthly fees: None
  • Early Account Termination Fee: Unknown
  • Insured: NCUA

The Offer

Direct Link to offer

  • Destinations Credit Union offers a high-interest checking account that earns 3.01% APY on balances up to $10,000 when doing the qualifying actions (below).
  • An additional benefit of the checking account is that domestic ATM fees incurred will be reimbursed up to a limit of $20 per cycle, when doing the qualifying actions.

When opening the account online, be sure to choose the Kasasa Cash option and not the Kasasa Cash Back option.

[Destinations CU also offers a Kasasa Savings account that can get up to .75% interest, but that’s part isn’t too impressive since it’s possible to get slightly higher than that with other savings accounts, such as Ally and Discover.]

Qualifying Actions

To be eligible for the higher rate, you need to do three things each qualification cycle:

  • Have at least 12 debit card purchases post and settle
  • Be enrolled and receive eStatement notice
  • Be enrolled and log into online banking

Basically, after the initial setup, you’ll have to log into your online banking once each month, plus make 12 debit card purchases. See this chart for the exact dates of the qualification cycles.

If you don’t do the qualifying actions, there are still no fees at all, but the interest rate will drop to .05% APY.

How to Join

  • Anyone can join the credit union by becoming a member of the Friends of the Red Cross; the option will pop up during the account opening process. You need to make a $25 donation to the Red Cross to become a member.
  • See also other organizations you can belong to and qualify for membership here.
  • If your family member is eligible to join DCU (e.g. the family member is a member of Red Cross) then you can join as well.

[Update: It appears that the Red Cross option has now been limited to MD and DE, so this may no longer be nationwide.]

The Fine Print

  • APYs accurate as of 10/01/2015; rates may change after account is opened
  • ATM fee reimbursements will be credited to the account on the first business day of the next monthly statement cycle; ATM receipt must be presented for reimbursement of an individual ATM fee of $5.00 or higher
  • When qualifying actions are met, balances over $10,000 earn 0.25% dividend rate on the portion of the balance over $10,000, resulting in 3.01% – 0.50% APY depending on the balance; if qualifications are not met, all balances earn 0.05% APY
  • Qualifying transactions must post to and settle Kasasa Cash account during monthly qualification cycle; transactions may take one or more business days from the date transaction was made to post to and settle account
  • ATM-processed transactions do not count towards qualifying debit card transactions
  • The advertised Kasasa Cash APY is based on compounding dividends
  • Dividends earned in Kasasa Cash are automatically transferred to Kasasa Saver each statement cycle and does not compound
  • Actual interest amount paid may be less than advertised Kasasa Cash APY

Credit Card Funding

You can fund up to $1,000 with Paypal or $500 with a credit card directly.

Readers in the comments to this post had success funding via Paypal with INK and Fidelity Amex with no cash advance problem. Presumably, that will be the case with any card when using the Paypal option.

Especially nice about the Paypal option is that you can even fund with Amex, a rarity in bank funding.

Our Verdict

The 12-debit-transaction requirement is a pain but doable; you can buy twelve 50¢ Amazon gift cards or even do twelve $1 Serve loads online. There is a $25 fee to join the credit union, but it’s going to the Red Cross which makes it easier to swallow.

It’s good to see another option for high-interest savings. There are a many others that we’ve covered, including CCU for 4.59% interest on up to $20k, LMCU for 3% on up to $15k, GLCU for 3% on up to $10k, and numerous prepaid cards on up to $5k, and Northpointe on up to $5k.

Thanks to tbradnc on Reddit for sharing this option and the details



49 Responses to Destinations Credit Union: 3% Reward Checking Account, Up to $10,000

  1. joE says:

    It’s great to see another nation wide option, they are fairly rare when it comes to rewards checking.

    BTW: LMCU pays 3% on up $15k though it is noted as $10k under the “Our Verdict” section.

  2. Shaun says:

    Does anyone know why these 3% and higher accounts take hard pull? For example, do they sell my information and that’s why they can offer such high rates? I just don’t know why high interest = hard pulls.

    • joE says:

      It just happens that Credit Unions (CU) are the only ones that offer these types of accounts. They are non for profit organizations so they take your funds and lend them to their members or invest them, returning the profits back to their members (you).

      CUs that do a hard pull will do so almost for any product and it’s not just on high interest checking accounts. You also start getting into KYC and CIP requirements which is a whole other discussion.

  3. tbradnc says:

    Glad to spread the word on this one. Note that while they communicate via email fairly quickly the process of opening an account takes some time. I submitted my application on December 10th and am just now getting to the point of actually funding the account. Christmas notwithstanding, over 2 weeks to open an account is pretty slow.

  4. Gnarly Cow says:

    Just applied for membership and this reward checking account. Looks like instant approval after I answered the ID verification questions correctly. A warning though: PayPal funding may not post as purchase. I used FIA Fidelity AMEX card, and the pending transaction is shown as “MARK QUASI CASH”, which likely will post as cash advance. Will report back in a few days when this posts. In the mean time, you may want to choose $500 CC funding directly.

    • Gnarly Cow says:

      Took another look and I noticed the available credit for cash advance on my FIA card isn’t reduced. A good sign I guess; maybe it isn’t going to post as CA after all.. We’ll see

    • Waddly Penguin says:

      Has anyone attempted to fund this with a CSP or other Chase card, via paypal or directly?

      I didn’t realize paypal still did quasi-cash transactions, but they have posted as cash advances in the past. Barring any info, I will ask Chase to lower my CA limit, and will report back if the charge isn’t declined.

      • Waddly Penguin says:

        I submitted my application today, but it appears the option to fund by PayPal is no longer available (as Ben said below).

        I opted to fund $500 with my CSP, which has a $100 CA limit. I don’t see any temporary authorizations yet. I suspect that the transaction will be declined, but I will post my results here when I get them.

    • Chuck says:

      Wow, I assumed anything running thru Paypal’s system can’t be a cash advance. Let us know how it goes.

  5. tbradnc says:

    I opened via PayPal ($1000) using an Ink+ with a CA limit of $500. Went through fine – fully expect it to post as a purchase.

  6. Gnarly Cow says:

    Even though their online approval seems instant, they still require us to print out the filled application, sign it, and mail it to their main branch along with a quality copy of driver’s license.

    • tbradnc says:

      I finally received my login information yesterday.. So 20 days from submitting the application to actually getting into my account. They also have my account coded wrong but I was told it would be fixed – it has been somewhat of an ordeal but they’re easy to reach and pleasant to deal with…

  7. Ken says:

    The hard inquiry kills this for me with all the Citi inquiries I’ve got on my Equifax file.

    Does anyone know which bureau they pull for the hard inquiry yet?

  8. Gnarly Cow says:

    I just pulled my TU, and saw that they only did a soft inquiry, listed as “DESTINATIONS CREDIT via DESTINATIONS CREDIT UNIO” under Account Review inquires. It’s possible that they hard-pull me later, but I doubt it.

  9. Ben says:

    I tried to sign up for an account tonight but when I set up my account funding I only saw an option for $500.00 in funding via Visa or MasterCard, nothing about $1000.00 via paypal. Is there somewhere special I should be looking? Thanks in advance.

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  11. tbradnc says:

    Just a heads up… they’re rolling out a new website and the new one doesn’t have eStatement opt-in capability.

  12. greedy says:

    If it’s a hard pull, then it’s an easy pass for me, here’s why:

    3% APY = $300 annual interest, but since you already get 1.2% APY from normal savings accounts, you only really benefit by $180 annually (3% – 1.2% = 1.8% APY increase)

    $25 donation to redcross wipes out the cashback from CC funding.

    So really it’s $180 extra you make but you incur a hard pull, and still have to perform 144 debit card transactions.

    Not worth it for me.

    • tbradnc says:

      Not trying to change your mind but don’t forget you get 2% back on up to $250 per month for using the debit card. So… that’s $60 per year.

      I’m going to buy a $250 VGC for $253 at First Tennessee Bank with the debit card and funnel the money back to Destinations. The other required monthly transactions will be $1 Amazon reloads. Easy.

      • Gnarly Cow says:

        I think you are talking about Kasasa Cash Back, which gives you 2% back on up to $250 if you meet all requirements. This is different from Kasasa Cash, which gives 3% APY on the first $10000. Two different accounts I believe.

  13. anthonyjh21 says:

    Last month they told me they’d do a pull for my wife and I if I opened a joint account. I just submitted a question to clarify whether or not they do a hard or soft pull. I’ll post when updated.

    Now that Serve is gone the 12 debit transactions per month are making this less appealing. For those with this account, how are you clearing the 12 debit transactions per month? Amazon small gift cards? If no hard pull then I’ll go for it regardless.

  14. Ken says:

    The biggest drawback here is the Transunion hard pull.

    Please update the bottom of the post here to remove the hard pull note if it’s now a soft pull.

    • Chuck says:

      Thanks for pointing out, will update

      • anthonyjh21 says:

        Isn’t the verdict still out? Thus far I’ve counted a total of 2 people who note it’s a soft pull. While that’s really encouraging, I’m not 100% convinced (yet) that it’s in fact a soft pull. I’m waiting on a response from Destinations as to whether or not they do a hard pull.

        • Chuck says:

          I didn’t contact them, but once we had 2 confirms I rely on that.

        • tbradnc says:

          I have an email from a branch manager that specifically says they do a hard pull from Transunion – but they didn’t.

          So… my experience is that you can disregard whatever they tell you and go with the 3 of us who have opened an account without a HP.

          However, I just opened an account with Lake Michigan and they absolutely are a hard pull on Transunion. It hit my CR within minutes of submitting the app.

        • tbradnc says:

          “Hello:

          We currently pull from Transunion and it is a hard pull. You are correct with the description of the card purchases. As long as the card purchase(gas, coffee, groceries, clothes) posts within the cycle period, it will count towards the 12.

          Thank you.

          Trish Fluke
          Branch Manager”

  15. Ted says:

    My membership application went from Approved to Cancelled. According to them, they no longer accept membership through Friends of Red Cross as of 2/1/2016.

    • tbradnc says:

      Sounds like a convenient reason to stop accepting non-local applications.

      • Waddly Penguin says:

        Yeah. Their eligibility page has the following language:

        “Friends of the Red Cross (Greater Chesapeake Region Only – must live in Maryland or Delaware)”

        (http://www.destinationscu.org/membership-eligibility.html)

        I assume those of us who already opened accounts are fine, but if Ted’s information is correct, it doesn’t seem like this is nationwide anymore.

        • Chuck says:

          Yeah, previously it said: “American Red Cross (Maryland Chapter)Red Cross, Friends of the Red Cross.”
          Now it says: “American Red Cross (Maryland Chapter) Red Cross
          Friends of the Red Cross (Greater Chesapeake Region Only – must live in Maryland or Delaware).”
          So there may have been some change here. thanks for pointing out.

          • Tina says:

            Can anyone give me a referral to open this account? Opened and representative stated that we must be connected through someone that works for one of the affiliates or a current member.

  16. Charly Chang says:

    Is it certain that non-MD/DE resident can’t apply? If so, I will not try then.

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