I have a question about funding new bank accounts with credit cards.
For example, here is a new USBank business account offer: $400/$900 Business Checking Bonus depending on which account you open.
https://www.doctorofcredit.com/u-s-bank-400-900-business-checking-bonus/
It says there is an option to fund up to $3k with a credit card. What does it mean exactly? Is it really up to 3K, coded as a purchase? Who pays the credit card transaction fee? The data points on DoC show that many types of cards code it as purchases.
A more general question: how often do you use credit card funding to get bank account bonuses and credit card sign up bonuses at the same time? How often does it work as intended? What happens if it's coded as a cash withdrawal?
It means when you are nearing the end of the application on your new bank account you are given the option of funding your new account now, or later. As far as I know, it is never an option to fund later with a credit card. So if you choose to fund now, you can often use either a debit card or a credit card. My experience is that it only works online, not in branch or through customer service phone reps (although it may work in some cases, this is just my experience, as I said). I've had a CSR tell me I can't fund with a cc, even though the terms online say I can, so I've said, politely, thanks, I'll finish up online, and the cc funding has worked perfectly.
I was hesitant at first, but I've done it multiple times now successfully and have not been hit with a cash advance, nor have I had to pay a transaction fee. My legit business spend has evaporated so I needed to find a new source of spend to take advantage of the cc bonuses.
The key is to do as much research as possible on DOC before trying it, both in the posts, but especially in the comments.
For example, when using US Bank business cc's, you want to raise your CA to the max: the max in this case being 25% of your available credit, which is the opposite of many cards where you want to lower your CA. Then you want to fund just under you CA max. Again, this is just for USB business cards, as far as I know. I used both a Leverage and a Triple Cash recently to fund bank account openings, both times the funding was enough to completely cover the cc spend requirements for the bonuses. I always use the cc a few times first for basic grocery purchases, or whatever.
It's made me up my game, so to speak, and I started closing older cards to keep my credit limit high on my new card applications. I've also been making a list of possible bank accounts to open that allow cc funding. Many of them are smaller credit unions, and often you can open a checking account and fund it with $5k from a cc (the best one I've found is $10k, which is why it's key to keep your credit limit high). Then you can open a savings account, and sometimes another savings account, and fund with a cc each time.
It's ideal if the cc is a 12 month no interest card, then you can just leave the $10k charge on the cc, make minimum monthly payments for a year, and move the $10k from the initial bank account to one that pays 5% interest for a year, then use that to pay off the cc when due.
Or you can use that vaporware cash to fund other bank accounts for sign up bonuses, which is what I'm doing, since it's more lucrative than 5% interest.
If the cc funding does code as a cash advance, obviously you want to pay that card off ASAP. It helps if you have the funds not tied up to do so, if not you'll need to set up payment from your recently funded new bank account, or transfer to your hub account and pay off the cc from there.
The cc funding is really separate from the bank bonuses in my mind. The bank bonuses often need direct deposits, real or fake, and sometimes a certain number of transactions per month before you get the bonus a few months later. The cc funding when you are opening a bank account for a bonus is just an extra $$. I open bank accounts now that don't offer a bonus just for the cc funding because otherwise I could never generate enough spend to take advantage of the more lucrative cc bonuses.
I'm also keeping my Chex locked when applying for smaller bank bonuses because I don't want to jeopardize my ability to open a bank account when needed for cc funding.
It's also nice to keep a 2% credit card available for funding if you are not working on spend for a cc bonus. In your $3k US Bank checking account example above, 2% of $3k is an extra $60. Not huge, but it is free.
