Consolidating Your Banking May be a good Idea

We understand why consolidated banking is a good idea from the financial institution’s point of view; they maximize the profit from that particular customer and no longer have to expend any effort in trying to capture their other banking/lending/investments. But, why is it a good idea for the client?

Financial institutions concentrate their sales efforts on bringing in a larger share of the customer’s wallet. This can also work to the customer’s advantage. As a customer, you may be able to receive benefits such as better interest rates and reduced or no fees for bringing in their loans, retirement savings and other investments. Free checking accounts, free safe deposit boxes, very low cost overdraft protection, personal document shredding, free coin counters, preferred rates on credit cards and auto loans are some of the advantages of having your finances in one place. Another good reason for combining your accounts is relationship pricing on loans and savings products. This means that, depending on the size of your overall relationship, you may be able to get higher rates on your time deposits and lower rates or reduced rates on your borrowing. With many institutions, you will see increased benefits as their deposits and relationships increase in size. Often these are tiered benefits that kick in at $10K, $25K, and $50K.

If you have a particularly large relationship; one that includes your investments and home and business loans, you may find yourself in a unique position. Your financial institution may make some very significant concessions should you decide to look elsewhere for your banking services. Are you refinancing your mortgage? Your manager will likely do their best to meet or beat any competitor’s quote!

But it’s not just financial savings. There are some real convenience issues here too! Combined statements are very convenient; being able to see all your accounts in one statement saves a lot of time. When you enter your online banking, all of your accounts can be accessed at once for transfers and other business.

You can have a better, often more personal relationship with your financial institution. As a manager myself not too many years ago, I had always assigned my best bankers to my top clients. I have always believed bank managers should treat his or her best and most profitable clients like royalty. They should assign an employee to them as their “Personal Banker.” Now, if the manager is not in, the customer has an assigned representative to support their financial needs.

Finally, when you die, if all your accounts are in one place, you have made things much easier for the executor of your estate. They don’t need to go to multiple financial institutions to settle the estate. This saves your family time and effort. 

*   *   *

It is Homebuying Weekend June 7th and 8th at the Meriwest Credit Union's Sunnyvale Financial Center on El Camino at Fair Oaks. Friday the 7th is Mortgage Day. Loan Agent Bruno Gonzalez will be present all day to answer your home purchase and refinance questions.  

On Saturday, June 8th, we will be presenting "Homebuying Strategies for the Current Bay Area Housing market."

Presented by Michael Mendenhall of Keller Williams Realty, with Bruno Gonzalez of Meriwest Mortgage. 

You will learn:

• The truth about foreclosures, short sales and other sources of housing inventory.
• Purchasing real estate in today's changing housing market
• Possible problems when purchasing a short sale home, flipped or bank-owned property.
• Defining your homeownership goals and creating a step-by-step strategy to achieve them.
• What you need to have in place to start looking for a home.
• The benefits of homeownership in the bay area.
• How to view homes and make offers that get accepted, at the best price with the most favorable terms.
• Understanding your financing choices when purchasing a home.
• Acquainting yourself with the required real estate documents.

 I hope you can join us June 7th and 8th in Sunnyvale!

Selecting a Checking Account for your Business

Business owners have special needs when it comes to their business checking account. When one is opening a new business or considering a change in financial institutions, it pays to look beyond the standard commercial bank and do some extra research on a type of financial institution that has been around for years, the credit union. Here at Meriwest Credit Union we have been involved in business banking and lending for many years.

There are a number of questions that must be asked when you are vetting a new home for your business checking account. How will you use your checking account? Will you be writing checks or using online banking to pay bills and vendors? Using online resources can save you some money with some institutions. Are you able to designate people, such as a bookkeeper, and give them a personal secure log in account to do business or transact inquiries on the account?

What are the monthly fees and how do you get them reversed or cancelled? Is there a minimum balance requirement? Can that requirement be met by depositing funds in a savings/money market account?

Does the bank offer overdraft protection? This is often a deal breaker for a lot of business people. The best sort of overdraft protection is a line of credit associated with the account where dollars are transferred off the line of credit should a deposit need to be made when a check is clearing. Some institutions will allow you to overdraft the account slightly, while charging a significant overdraft fee of $35 or higher. The worst is what I refer to as a “Call and a Prayer Overdraft Protection;” the bank calls you to tell you that checks are clearing and you pray you make it to the bank on time to make the deposit for them to clear. This is very stressful and very expensive as they will charge you to pay those items provided you make it to the office to make the deposit on time. If you don’t make it, your checks will be returned and your time was wasted.  

More questions business owners should ask about a prospective financial institution: How convenient are the offices? Can you bank electronically? What are their hours? Do they open Saturdays?

An important aspect of this is the customer service the institution gives you. When you walk in to get information, are you recognized right away as a new client and greeted? Or are you ignored? Does the sales person strive to give you a complete run down of the information you need to make your decision or do they shove brochures at you? Does the staff appear to be well informed and competent or slightly confused and embarrassed by it? You can tell a lot about an institution from walking in on a Friday night an hour before closing and watching the flow of customers. Observe the tellers, are they competently going about their work or does a supervisor have to help with their transactions? Are customers in line pleasantly waiting or impatient? Impatience may be a signal that long waits in the teller line are common in that institution.

A few years ago, credit unions started offering business accounts to small businesses in their communities. Among the advantages of a credit union over a bank is the concept of shared banking. A business owner can go to any shared branch of any credit union across the country and make a deposit to an account at their credit union. Another advantage is that credit unions typically have fewer fees and those fees that are charged are often less than their bank competitors.

A business owner’s time is precious. It is important they spend a bit of time examining and shopping institutions they may be considering for their banking. This way they can save a lot of money, time and hassle in the future.

Meriwest Credit Union does offer a free business checking account. See our Business Banking link here to view our checking account offers for small business owners. 

*  *  *

Free Homebuying Workshop

Home Buying Strategies for the Current Bay Area Housing Market

Thursday, September 13, 2012 - 6:30PM

Meriwest Credit Union Monta Loma Financial Center

580 N. Rengstorff Ave., Mountain View CA 94043