Posted by Chuck on June 20, 2018
Savings Accounts

Published on June 20th, 2018 | by Chuck

261

[Expired] Northern Bank Direct 2.26% APY Money Market Account – Will End At 9AM EST Today For New Applications [Dead]

Update: Rate has increased to 2.47% with a 2.50% APY for balances up to $250,000.00. Account not available to new customers, this rate upgrade is for existing account holders only.

Rate is no longer available sadly. View the best current rates here.

Update: They won’t be accepting new applications after 9AM EST June 20th (today). Few hours left to get the account if you’re interested. Hat tip to reader Ty

The Offer

Direct Link to offer

  • Northern Bank Direct is offering a 2.26% APY interest rate on their money market account. Rate is guaranteed through June 30, 2019.

You do need $5,000 to open this account, however, there’s no need to have $5,000 in the account to earn the rate, just to open the account, as per the fine print.

Northern Bank Direct is the online arm of Northern Bank (a Massachusetts based bank) – accounts are available to anyone nationwide. The bank is FDIC insured. No monthly fees.

The Fine Print

  • Annual Percentage Yield (APY) effective as of 6/8/18.
  • Minimum deposit of $5,000 to open the account.
  • Maximum opening deposit of $250,000.00.
  • Money Market average daily balances from $.01 to $250,000.00 earn the advertised 2.24% interest rate with an Annual Percentage Yield (APY) of 2.26%.
  • Money Market average daily balances between $250,000.01 and $1,000,000.00 earn an interest rate of 0.75% resulting in a blended APY between 2.26% and 1.13%.
  • Money Market average daily balances greater than $1,000,000.00 earn an interest rate of 0.01%, resulting in a blended APY between 1.13% (for average daily balances just over $1,000,000.00) and 0.23% (for an average daily deposit balance of $5,000,000.00).
  • Your interest rate and APY are accurate as of June 8, 2018 and guaranteed through June 30, 2019.
  • After June 30, 2019, your interest rate and APY may change and at our discretion we may change the interest rate on your account daily. The interest rate will be determined by us based on current market conditions.
  • You can make up to 6 transfers per month to another account with us or to a third party.

Our Verdict

Rate is a good bit above the next-best available rates of around 2% APY (check updated rates in our dedicated post), and rate is guaranteed for a year.

The fed recently raised interest rates by .25%, and signaled that two more raises are on their way this year. So the main thing is really to find a bank who will KEEP UP their rates as rates overall go up.

That said, it’s likely this will still be a good or very good rate for the next 12 months. If you have a lot of cash on hand, and don’t mind jumping banks, this could make sense. For example, if you have $100k cash, you’ll net an extra $260 using this account over an account which earns 2%.

We’ll add this to our list of Best High Yield/Interest Savings Accounts – Up To 5% APY.

Hat tip to reader Eduardo Baez



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Gadget
Gadget

I assume no CC funding options here?

tck
tck

Didn’t see any option when I applied online.

Gadget
Gadget

Just wondering… like maybe if you opened a regular savings, or some other account, the options might change? Probably not, but doesn’t hurt to ask. I’m already at 2% at VirtualBank, but I might move over here depending on the DP’s. Thanks for the reply.

Just a Note
Just a Note

From the FAQ: “However, you cannot link to a credit card account or some types of brokerage or investment accounts.”

Ken
Ken

Link from your hub account and initiate all transfers from there.

Chris
Chris

Open to aliens that reside non-permanently in the country? Is that type of situation called resident alien?

azpv
azpv

If you are in AZ/TX, TruWest CU has an 11 mo CD for 2.50% https://truwest.org/cdspecial/

Ken
Ken

If you’re in TX Vista Bank has 3.5% checking up to $30k 😉

LAG
LAG

Looks like that was decreased at some point… only reflects 2.5 now

https://www.vistabank.com/Personal/Personal-Checking-Overview/Vista-Checking

Still a good option though

Xela
Xela
LAG
LAG

Thanks! I thought I clicked them all, but somehow I missed that one. 30 debits is a bit much. Any DPs on Amazon reloads working or any of the other methods?

Ken
Ken

Yes, 30 is a lot, but AZ reloads work fine.

LAG
LAG

Awesome, sounds like I’ll definitely be moving some funds here after Insight closes. Thanks!

If there are any referral bonuses or other advantages for the bank let me know. I didn’t see anything on my brief search nor did I see it on DoC page of high interest accounts. Maybe we can get it added Chuck?

Ken
Ken

Also Heritage Bank is 3.33% up to $25k for only 10 debits and 1 ACH per month.

John
John

Is this account only for TX residents?

Ken
Ken

Which bank are you referring to? Heritage is nationwide and Vista I’m not sure.

Harold
Harold

ACH transfers initiated at Northern Bank are limited a paltry $5,000/day.

Dave
Dave

Do they limit ACH transfers push/pulled from outside banks?

Gadget
Gadget

Highly unlikely. It’s the initiating bank that takes the risk, and sets the limit on transfer size, from what I have seen and read. But, it’s annoying when banks do this. This is why it’s good to keep a high limit hub account.

tck
tck

As far as I know, a bank or CU cannot limit what is push/pulled by an outside institution.

Boricua City
Boricua City

I never experienced this either, until Popular Direct just froze all my transfers. That is, I pulled from another bank by ACH, saw the withdrawals appear at Popular as pending, and then Popular somehow still managed to block them. I haven’t figured out what’s going on there yet, but apparently Popular is preventing lots of their depositors from withdrawing.

tck
tck

That seems so sketchy, is that legal?? I’d call em on it, go as high up the chain as you need to go.

ppsh
ppsh

Robinhood has been doing that to my assets, all without any notice, for over five months, until I tried to withdraw. I’ve filed complaints with FINRA (no response) and the SEC (which only passed my complaint to them). Now it’s almost a year, and those jerks still won’t let me withdraw, but continue to allow inflow.

bax
bax

Dollar Savings Direct blocks all ACH pulls.

Dave
Dave

Got it. Hearing a lot about Alliant being a good hub account. May give them a shot. Need to change from Schwab which puts a 4-day hold on any incoming deposits, after they post.

Snorlax
Snorlax

Switch to Fidelity, same benefits as Schwab (no fee, ATM reimbursement, etc) but I’ve never had account holds on deposits.

Tom
Tom

I use Schwab as an investment and checking hub along with Ally as a savings hub. Schwab only puts a hold on pulled funds. If the funds are pushed in they are available right away. I always push funds anyway.

azpv
azpv

They do not. Per their FAQ: If you initiate the electronic transfer from your other financial institution, Northern Bank Direct does not impose a limit on the amount of the transfer.

Ken
Ken

Open a hub account and do all xfers from there.

Pato
Pato

Registered right away since the APY is so good given that there are no restrictions. They asked verifying questions (not from credit report) not sure what they pulled or chex but no HP. I am waiting my verifying deposits now.

Ann
Ann

This DP confirms that Northern Bank Direct does pull ChexSystems to open this MM account: https://www.bogleheads.org/forum/viewtopic.php?t=251617#p3978637

Identity verification questions at many banks come from LexisNexis Accurint. You can’t dispute incorrect info they may have, but at least you can get a copy of your report to use as a guide to how to answer those questions. https://www.reddit.com/r/churning/comments/69yzhy/psa_cant_churn_bank_accounts_because_of_failed/

Ken
Ken

It’s definitely possible to dispute LN info. https://personalreports.lexisnexis.com/dispute.jsp

jennifer miller
jennifer miller

Thanks doc! I’m in!! Nice compliment to my 2 first advantage bank’s 4.5% accounts!!! Kinda disappointed, I had applied yesterday for redneck bank, but I still applied anyway for this one.

jennifer miller
jennifer miller

Haaa!!! Just got an email from redneck bank, declined due to check! Lol, that’s fine cause I want northern instead! Hope northern doesn’t decline me! Never been declined for a bank account before, but I opened 6 accounts in the last 2 months and had 4 accounts already(no new ones,), so maybe I better cool it… I just want this northern account and I’ll be sorted. Anyone know if northern is checking sensitive? I went thru the application, and it says to wait for the test deposits, so hopefully that means I’m already approved.

jennifer miller
jennifer miller

**auto-correct^^^ should be chex and chexsystems

David B
David B

Could be a decent option to park the 5k many will be withdrawing from Insight soon.

Ken
Ken

Would be great to know if you can get through the ID questions with EX frozen. That prevented me from opening Virtual Bank.

datapoint
datapoint

Many *FROZEN* by Popular Direct are moving to Northern Bank Direct. Just keep in mind that closing Popular (aka Banco Popular) before 180 days “may result” in a 25 fee, likely can be negotiated due to the fiasco in lack of customer service by bank.

datapoint1
datapoint1

My Northern Direct account was frozen after the money was transferred from Popular Direct. It seems it went through first (the Popular Direct deducted the money) but then now the money is “being refunded” back to my Popular Direct. Sent Northern a message for reasons. Anyone else?

Ken
Ken

Where did you initiate the transfer? Pull from Northern or push from Popular?

datapoint1
datapoint1

Account opening deposit so it is pull from Northern. Went through the trial deposit and everything looked normal.

Chris B
Chris B

Good to note that they have also a very good rate for 30 months CD at 3%

Chris
Chris

Their CD’s come with pretty severe early withdrawal penalty though!! Never seen this high:
What are the early withdrawal penalties on CDs?

Early withdrawal penalties vary depending upon the CD term and are based on interest. Please reference the below for more details.

Term of 12 months to 35 months: 12-months interest
Term of 36 months to 47 months: 24-months interest
Term of 48 months or greater: 36-months interest

Sherm
Sherm

Thank you for your interest in opening a new account.
Unfortunately, we cannot process your application.
For assistance, please contact us at (800)273-6908.

tribesman55
tribesman55

Chex sensitive?

Ken
Ken

Are any of your credit reports frozen? how many bank accounts have you opened in the past 6/12/24 months?

Jared
Jared

I got same error. None of my credit reports are frozen; do multiple accounts at same bank count as new bank account? If not, then 1 account in past 6 months, 3 accounts past 12 months, and 7 accounts past 24 months, but that’s sort of a guess.

Ken
Ken

Wow, that’s not a lot of accounts at all. Have you called them to see why you were declined?

RD
RD

You forgot to mention the fees Northern Bank charges such as $3.00 per external transfer and $25.00 to close the account. Also, you can only transfer $5000 max per day and $25,000 per month. Free checks are good however.

phycodes
phycodes

Couldn’t find that on the FAQ – where did you see that?

NVM i see it in the agreement but it’s under ‘Personal Account’ going to call and figure it out.

azpv
azpv

phycodes I found in their fee schedule: Account Closure by mail $10.00
External Transfer fee per transfer $3.00
Account inactivity fee charged in the 12th month for all checking accounts with no activity $3.75
It’s on p.4
https://www.northernbankdirect.com/content/disclosures/account-agreement.pdf

Gadget
Gadget

Account Closure by mail fee – that shouldn’t be assessed if you zero the balance before requesting acct closure. Banks normally only charge that close by mail fee if you ask for an account to be closed that has a balance, and they have to send a certified check and prepare some docs/expedite. Depends on the banks procedures.

Inactivity fee on CHECKING accounts – A Money Market is technically a savings account, even if it has checkwriting. This is why withdrawals are capped at 6/mo, just like every savings acct, due to REG D. Just one deposit or withdrawal/year would cancel that fee anyway if they are thinking it applies.

Ann
Ann

“Just one deposit or withdrawal/year would cancel that fee anyway if they are thinking it applies.”

Yes, I recommend doing automated $1 transfers to/from an external account periodically to easily avoid that.

datapoint
datapoint

Use a HUB account to perform push/pull ACH transactions. No fees

azpv
azpv

Some banks say that an External Transfer may be an Inbound Transfer or an Outbound Transfer. Does the $3.00 fee per external transfer refer to push transfers? Could I use Discover Bank to pull and push money without a fee? It does appear that there is a $10 fee to close the account by mail (per their fee schedule), is there a fee to close it some other way, for example, by phone or SM?

Missjenniferd1
Missjenniferd1

Yes, when theres a fee for a transfer, you can avoid the fee by using a different bank to do the transfer for free. Recently, i have also found that i was better off if i initiated all transfers from one account. Otherwise you have to log into multiple accounts to check statuses of transfers, or in my case, forgot i even did a transfer on one bank’s site, and then duplicated the transaction at the other bank’s site. Couldve been a disaster, but i had enough money. But after that, decided to just use one bank to do all transfers, in my case, i use usaa. 1 day transfers for push. Instant credit for funds when pulling from another bank. As a side note though, northern no longer charges the $3 fee, but i will still be using usaa for transfers even though its now free to do at northern.

phycodes
phycodes

Via phone rep: the $3 fee is no longer applicable as of today and the $25 closing fee only applies if you close the account within the first 120 days.

azpv
azpv

Thanks phycodes for checking this.On pg 5 they do mention a $25 fee for closing an account within 120 days.

RD
RD

I called them and asked. The 25 buck closing fee may have been if closed before 120 days, but that is what they told me.Closure by mail is 10 bucks. You can also write a check for transfers exceeding the 5K or 25K limits which is acceptable.

Ken
Ken

Use a hub account to pull/push funds and Northern’s limits won’t apply, but the hub accounts will, and hub accounts have much higher limits. Alliant has a $25k limit and I have only needed more than that on rare occasions when I was being lazy. Ally has even higher limits, like $100k.

Lisa
Lisa

Just opened an account with Northpointe 🙁

Ken
Ken

I emailed them and they said it was a soft pull to open.

Ken
Ken

Has anyone been approved and had their Experian report frozen?

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