Banking Deals of the Week: July 7

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Barrels of ink have been spilled, and millions of keystrokes have been struck by people trying to figure out why the economy isn’t clicking on all cylinders.

We could probably save a lot of trouble by declaring the obvious: a perfect storm has emerged, fueled by a confluence of economic factors that threaten to throw the U.S. economy back into recession – or worse.

Such factors include:

  • A weak job market – The private sector only created 83,000 jobs in June, according to the U.S. Labor Dept. We’ll need at least 200,000 jobs  created every month to get us back to pre-recession job levels, and that could take a decade, some economists say.
  • A limp housing market – Mortgage applications continue to slide, according to the Mortgage Bankers Association’s most recent survey.  
  • A “white-knuckle” global debt crisis – The debt crisis that is threatening Greece may spill over into other Euro counties, and maybe even the United States.
  • A tepid consumer confidence landscape – The latest Conference Board consumer confidence number is down to 52.9 – down from 62.7 in May.

Any one of these scenarios – if they worsened – could derail any economic momentum. That would be bad news indeed for bank rate savers. When the economy is down, the Federal Reserve will almost certainly look to keep rates as low as possible. When interest rates are low, bank rates are sure to follow.

While all of this news is thin gruel for bank investors, there are some slivers of sunlight.  More specifically, there are still some surprisingly good deals out there on the market – and BankingMyWay has dug up a few for you this week.

Bank Rewards Checking
Massachusetts-based South Shore Savings Bank has unleashed the hounds with a great new deal – open a new rewards checking account and get not only a 3.69% interest rate, but also a $200 bonus for opening the account.

The checking account doesn’t require a minimum fee or a minimum balance.

Let’s flesh out the details here:

Benefits
$200 deposited into your new account
A 3.69% interest rate
ATM Fee Refunds Nationwide
No Monthly fee and no minimum balance required

Requirements
Sign up to receive monthly e-Statements
Receive at least one direct deposit per statement cycle
Make at least 15 debit card purchases per statement cycle (excluding ATM transactions)
Sign up for Home Banking and use Bill Pay for at least once per statement cycle

The fine print (straight from the bank’s web site)
"3.69% Annual Percentage Yield (APY) as of 2/1/10 is paid on balances up to $24,999.99, and 0.10% APY paid on amounts over $25,000 per statement cycle the requirements are met. If you do not meet the requirements per statement cycle, you will receive a rate of 0.10% APY on balances over $10.  Normal activity charges will apply. Fees could reduce earnings. Rates may change at any time without prior notice. $10 minimum deposit to open and earn interest. One account per tax reporting owner. ¿**If requirements are met, South Shore Savings Bank will refund up to $10 per statement cycle and will not charge a foreign ATM fee for using another bank's ATM. Account requirements will be waived for the first statement cycle."

Find out more here.

Cash Back Credit Card

Credit card companies are starting to edge back into the marketplace of good deals, now that financial reform and credit card reform are both pretty much locked in.

Some card issuers are getting particularly aggressive about cash-back deals. Enter Capital One (Stock Quote: COF) and its No Hassle Card.

The card promises 2% cash back on purchases at gas stations and big grocery chains, and 1% cash rewards on all other purchases. For a decent kicker, there’s also no annual fee and no interest on any purchases you make in the first year owning the card.

Capital One bills this card as good for consumers “with average credit.” Maybe that’s why the interest rate skyrockets to 19.8% after the initial one-year grace period ends. But if you pay your bills on time and only use the card to buy what you need (and maybe not what Capital One wants you to spend money on) you can get a decent cash-back deal.

To get the card, you’ll need to have another credit card that has at least a $10,000 credit limit, and you must have a clean payment record (i.e. you can’t ever have declared bankruptcy or been 60 days late on a major payment, like a mortgage or credit card bill).

Capital One helpfully includes a chart showing you how you can earn $249 a year with the cash-back program. But a word of caution: this deal may make more sense for that first introductory year  - after that, all bets may be off.

Capital One Cash-Back Chart – No Hassles Card

Special Purchases (per month)
Food: $325
Gas: $250

Regular Purchases (per month)
Clothing: $300
Entertainment: $250

Other Purchases (per year)
Italian Leather Shoes: $500
Airfare to Europe: $1,500
60" Plasma TV: $2,500

Yearly Total: $18,000

2% on Gas and Groceries: $138
1% Cash Rewards: $111

Total Cash Rewards $249 (though who buys just one pair of Italian leather shoes a year?)

For more details click here.


Business Checking

We’ve written about KeyBank before, but for business checking customers, the past is past and the future is now with the bank’s new checking account deal.

Here’s the scoop. Right now, until July 30, business banking customers can earn up to $275 from Key Bank’s Online banking or Key Business Online account.

All you have to do is make two online bill pay transactions by October 1, 2010.

From the bank’s web site, here’s how the deals goes down:

"1. Get $225 when you open a Key Business Free Checking account by July 30 and enroll in either Online Banking or Key Business Online, and complete two Bill Pay transactions by October 1.

2. Receive $275 when you open one of the following business accounts by July 30 and enroll in either Online Banking or Key Business Online, and complete two Bill Pay transactions by October 1."

Here’s the fine print – read it thoroughly before making any moves on the deal.

"Between 5/1/10 and 7/30/10, open a Key Business Free Checking account, Key Business Reward Checking, Key Business Checking, Key Business Sweep Checking or Key Business Money Market Checking account and enroll in either Online Banking or Key Business Online and complete two Bill Pay transactions by 10/1/10 to get a cash gift. Your gift will be deposited into your account within 90 days of meeting requirements. Offer available to businesses without an existing checking account at KeyBank as of 4/30/10. Offer not available to businesses that have opened a KeyBank checking account in the last 12 months. Employees of KeyBank, its affiliates and subsidiaries are not eligible for this offer. Limit one gift per qualifying account. Limit one gift per business. The value of the gift will be reported on Form 1099-INT. Accounts closed within 180 days of account opening will be charged a $25 account early closure fee. Accounts overdrawn or closed as of 10/1/10 are not eligible for this offer. Accounts titled as Trust Accounts, Estate and No Access are excluded from eligibility. Offer is subject to cancellation without notice, and cannot be combined with any other business checking offer. Other miscellaneous charges may apply."

Read the whole enchilada here.

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