Whether you want to switch banks because you’ve had a series of bad experiences with your current bank or because you are moving, the process will likely be time-consuming, with you having to do some research. Keeping this in mind, we’ve listed down the 5 steps that you’ll need to follow when changing your bank:
Research new banks: Before you close your existing account, you should open a new account. Thus, make sure to research the new banks in your area. A few things that you keep an eye out for are the interest rates paid, fees charged for different accounts, customer service, free checking facility, ATMs in your area, etc. Make sure to also consider credit unions and online banks since they usually offer better interest rates and charge lower fees.
Open a checking account: Next, you’ll need to open a checking account in a new bank. Make sure to do this before you close your current account. Opening a checking account is a fairly simple process that you can do by providing a few details like your name, contact information, Social Security Number, photo identification, etc. Once you open the account, you’ll need to fund it.
Change your direct deposits: If you had any direct deposits that went to your previous account, make sure to inform the party that deposits the money to credit it into your new checking account.
Cancel any automatic payments: If you’ve set up automatic payments for loans, utility bills, or subscription services from your old account, make sure to cancel them right away so your creditors don’t attempt to deduct money from an account that doesn’t have any balance or is closed. You can restart the automatic payments from your new checking account.
Check if you have any unpaid loans: If you’ve taken a loan from your bank, the lender may have offered you a lower interest rate because you maintain an account with them or for setting up automatic payments. In this case, it is best to keep the account open until you’ve repaid the loan. While you can still open a new checking account with another bank, you should transfer the monthly repayment account to your current bank so the lender is able to deduct it automatically.
Once everything is in order, you can go ahead and close your account.
