Flagstar Direct, the online banking division of Flagstar Bank, is offering $100 bonus for its Express Checking Account. As a new customer, after you open a Flagstar Express Checking Account (the account can be opened online and the process takes about 10 minutes to complete), your money will start to grow because the account is an interest checking account, which means you will earn interest by having your money in the account. Currently, Flagstar has a four-month bonus interest rate of 1.0% for the Express Checking Account, regardless the amount of balance. The on-going interest rate of the account is 0.85% APY, which will be the rate you will get after the four-month promotion period. With the bonus rate, the first year blended APY will be 0.9% APY.
The 0.9% APY may not seem to be very impressive, but you need to put it in perspective and compare it with others and once you do that, you will realize that this offer is actually pretty good. The Fed has kept its benchmark lending rate at close to zero for almost three years. As a result, banks, online and B&M alike, have repeatedly cut yields of their savings accounts in the past few years. Right now, savings account yields at popular online banks such as Ally Bank, Sallie Mae Bank, ING Direct and FNBO Direct, are all around 1.0% APY. Therefore, if you can only get 1.0% APY from a savings account, the 0.9% APY from the Flagstar Express Checking Account doesn’t seem too bad at all. Plus, the checking account doesn’t have the limitation on the number of withdrawals per month as the savings accounts do.
To make this offer even sweeter, Flagstar will give you another $100 bonus if you set up a direct deposit or ACH transfer of at least %250 in the first four months after account opening. If you don’t plan to use this account as you primary checking account and use it to pay all your bills, direct deposit may not be that desirable, but the CH option is quite handy and can be set up easily. If you use ACH to make the initial deposit into the account (a $1 minimum is required to open the account), if you can just use that linked account to make automatic ACH transfer of $250 per month and get the $100 free money at the end of the promotional period. Some other benefits of the checking account include:
- No monthly maintenance fees
- No minimum balance
- Free checks for life
- Free Identity Theft Protection
Of course, Flagstar Direct isn’t the only online bank that offers interest checking account. To give you an idea on how they compare with others, take a look:
- EverBank Yield Pledge Checking Account: 1.51% three-month bonus rate, 1.02% APY for the first year; $1,500 minimum;
- Ally Bank Interest Checking Account: 0.50% APY for balance less than $15,000, 0.90% APY for balance greater than $15,000; $0 minimum;
- FNBO Direct Billpay Account: 1.0% APY; $0 minimum.
As you can see, Flagstar Interest Checking Account is very competitive, especially with the $100 bonus offer.