Transferring your products or services to another financial institution
Transferring products or services to another financial institution involves several steps and may take some time. You may need to get new products or services before cancelling the ones you currently have.
Make sure you allow enough time for the transfer of funds. Also allow time to receive any card associated to the new products or services.
Plan the steps you may need to transfer your products or services to a new financial institution in advance. Make sure you keep an eye on your existing products and services during the process. This will help you avoid fees related to overdraft, missed payments or non-sufficient funds (NSF).
Why you may want to transfer your products or services
There are many reasons why you may want to transfer your products or services to another financial institution.
- you want to save on fees or interest charges, or earn more interest
- you found other products or services with another institution that better suits your needs
- you're unsatisfied with the service at your current financial institution
- your financial institution is closing the branch where you hold your products or services
- another financial institution acquired your current financial institution
You may have to transfer your products or services if your financial institution fails. This is very rare in Canada, but it’s possible.
What to do in the event of a bank failure
If your financial institution fails, don’t panic. Deposit insurance protects your eligible deposits.
The Canada Deposit Insurance Corporation (CDIC) protects eligible deposits at each of its member institutions. CDIC coverage is free and automatic. You don’t have to sign up.
If your CDIC member institution fails, CDIC will communicate with you directly. They’ll reimburse your insured deposits based on the records of the failed member institution.
Deposits at other financial institutions may be protected by the provincial or territorial deposit insurance provider.
If your financial institution is provincially or territorially regulated, you can contact the provincial or territorial deposit insurance provider. They may inform you about what happens in the event of a financial institution failure.
What to consider before you transfer your products or services
Before you transfer your products or services to a new financial institution, there are things to consider.
Identify all your current products and services
List all the products and services, including automated transactions, you have with your current financial institution.
Some of the steps you can take include:
- getting the information from your online banking app or website
- asking your financial institution for a list of your products and services
- reviewing your monthly statements and identifying the different types of transactions you make
- reviewing the documents you received from your financial institution in the past
- getting your credit reports from the 2 main credit reporting agencies, Equifax and TransUnion, and reviewing the information
These steps will provide you with an overview of all your products and services.
It may also help you identify:
- products or services you need to transfer, close, cancel or stop
- products and services you use or don’t use
- products and services you want
- inactive accounts
Identify your banking needs
Financial institutions offer many types of products and services.
Before you sign up for new products or services, consider the following:
- how you’ll use them
- the applicable fees, if any
- the benefits, like lower fees and convenience, if any
- whether you want all your products and services with the same financial institution
Research and compare what financial institutions have to offer and identify which one will suit your needs better. Make sure you understand the terms and conditions of the products that the financial institution offers.
There are different levels of consumer protections in place for financial institutions offering financial products and services. This depends on who regulates them. For example, some financial institutions are federally regulated and others are provincially or territorially regulated.
You now benefit from new and enhanced protections when dealing with a federally regulated financial institution, such as a bank. The protections are part of Canada’s new Financial Consumer Protection Framework.
Transfer your chequing and savings accounts
You may transfer deposit accounts like your chequing and savings accounts from your current financial institution to another one.
Some of the steps you can take include:
Step 1: identify your automated transactions
To identify all your automated transactions, you may:
- review your transactions over the last months or from the past year to identify pre-authorized debits (PAD)
- identify all direct deposits, including those related to your:
- work income
- review your bills and your budget to make sure you don’t miss any payments
Step 2: open a new account
Banks, federal credit unions and authorized foreign banks must allow you to open a deposit account. They must do so if you meet certain conditions.
Make sure you understand all the terms and conditions of the new accounts. Ask questions about anything you don’t understand. Keep a copy of your account agreements for your records.
Step 3: transfer your funds
You may transfer your funds from your current accounts to your new accounts. Most financial institutions have processes in place to help you with transfers.
This may include:
- wire transfers
- Interac e-Transfers®
- linking your accounts
- electronic funds transfers
- bank drafts
Ask your financial institution about the best way to transfer your funds to your new chequing and savings accounts.
Step 4: set up your direct deposits and pre-authorized debits
Provide your creditors and service providers with your new banking information. Make sure you have the funds in your new accounts to cover your upcoming payments. This may help you avoid unexpected consequences, like missed payments and fees.
Ask your financial institution if they have a process to transfer your pre-authorized debits to your new account. If they don’t, you’ll have to set them up in your new account. You’ll also have to cancel them in your current account.
Step 5: review your accounts
Before you close your current chequing and savings accounts, make sure you:
- have access to your new chequing and savings accounts
- receive your new debit card, if applicable
- change your direct deposits
- cancel or transfer all your pre-authorized debits
- request stop payments for any cheques you have written
You may wish to keep your current accounts open for several months. This may help you avoid unexpected fees related to cheques and pre-authorized debits you may have missed.
Make sure you have the funds in your accounts to cover any payments.
Step 6: close your accounts
To close your current chequing and savings accounts, you must make a request to your current financial institution. You may have to pay a fee. Check the terms and conditions of your account agreements for information on closing fees.
Transfer your credit card
You may cancel your current credit card and get one with another financial institution. You must qualify for a credit card with your new financial institution. You may also transfer your credit card balance from your current financial institution (credit card) to another one.
Some of the steps you can take include:
Step 1: apply for a new credit card
Before you complete a credit card application, make sure you understand all the terms and conditions. Once you receive your new card, you’ll have to activate it before you start using it.
Step 2: identify your automated transactions
Review your credit card statements to identify all your automated transactions.
Step 3: review your credit card balance
Plan how you’ll pay the balance on your current credit card.
You may be able to transfer your balance to a new card. This is called a balance transfer. You’ll usually have to pay a fee to transfer a balance from one credit card to another.
It may take several weeks for a balance transfer to appear in your account.
Step 4: set up your automated transactions
Set up the automated transactions you identified in step 2. These include all your pre-authorized payments and recurring transactions.
Step 5: monitor your credit card accounts
Before you cancel your current credit card, transfer or cancel all your automated transactions, including pre-authorized payments. These may still be charged to your credit card even after you’ve cancelled it.
Step 6: cancel your credit card
To cancel your current credit card, you must contact your financial institution and make a request. Cutting up the card doesn’t cancel it.
Transfer your loan and line of credit
Some financial institutions have a process in place to transfer loans and lines of credit. Other financial institutions don’t allow the transfer of loans and lines of credit.
To transfer your current loan or line of credit, you may need to pay it in full and get a new one. In most cases, you may use your new loan or line of credit to pay off your current one. You’ll have to qualify for a new loan or line of credit with your new financial institution.
Ask your new financial institution about your options to pay off your current loan or line of credit. When you pay off your loan early, you may have to pay fees. Ask your financial institution about early payment fees.
Your new financial institution may offer a debt consolidation program. This option usually allows you to transfer all your existing loans and lines of credit into one consolidated loan. Your interest rate may be lower on the consolidated loan than on your previous loans and lines of credit.
Transfer your mortgage
You can’t transfer your existing mortgage to another lender. To switch mortgage lenders, you’ll have to break your current mortgage contract. You’ll also need to get approved for a new mortgage with a new lender. You may have to pay fees.
These fees may include:
- a prepayment penalty for breaking your current mortgage contract
- mortgage discharge fees
- setup fees with the new lender, which may include registration, and assignment fees from your current lender
- an appraisal to confirm the value of your property
- other fees that may apply, including administration fees
Transfer your registered product
Transferring registered products requires specific steps. You’ll need to complete and sign transfer forms. The Canada Revenue Agency (CRA) provides information on how to transfer registered products.
These products include:
- Registered Retirement Savings Plans (RRSP)
- Tax-Free Savings Accounts (TFSA)
- Registered Retirement Income Funds (RRIF)
- Registered Disability Savings Plans (RDSP)
- Registered Education Savings Plans (RESP)
Federally regulated financial institutions must transfer of Registered Plans within set timelines.
What to do after you transfer your products or services
There are steps you should take after you transfer your products or services to another financial institution. You may ask your financial institution to send you a list of the accounts that you closed. You can also ask for a list of products and services you cancelled.
Check your credit reports
To make sure your financial institution has closed your accounts, you should check your credit reports. You may order your credit reports from the 2 main credit reporting agencies, Equifax and TransUnion.
Your credit reports contain personal, financial and credit history information. In general, credit reporting agencies take 30 to 90 days to update information in your credit report.
Cancel your online banking access
Once you no longer have any products or services with a financial institution, cancel your online banking access. You may cancel it by phone, online or at your branch.
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