UFB Direct Review – Online Banking With High Yields

UFB Direct is a division of Axos Bank, a diversified financial services firm that administers deposit accounts and credit products for everyday consumers, small businesses, and commercial enterprises. Anyone with a U.S. address can make deposits and apply for loans.

UFB Direct has a distinctive lineup of deposit accounts, including savings, checking, and money market options. Like many other U.S.-based online banks, UFB Direct provides FDIC insurance up to $250,000 on all deposit accounts.

UFB Direct also offers mortgage loans through Axos Bank for single-family home purchases, refinancing, and other mortgage products.

Key Features

UFB Portfolio Savings Account

This account requires no minimum opening deposit. There’s no monthly maintenance fee or minimum balance requirement. The yield is 3.40% APY on all eligible balances, with the ability to boost to 3.60% APY by opening a UFB Freedom Checking account and meeting certain requirements (direct deposits, minimum balance, debit card transactions).

UFB Freedom Checking Account

UFB Direct now offers a checking account that earns 2.00% APY on all balances. There’s no monthly maintenance fee or minimum opening deposit requirement. The account comes with a complimentary debit card and access to over 90,000 fee-free ATMs nationwide, plus up to $10 in monthly ATM fee reimbursements.

UFB Portfolio Money Market Account

This account requires a $5,000 minimum opening deposit. There’s technically no minimum balance requirement, though the only way to waive the $10 monthly maintenance fee is to maintain a minimum daily balance of $5,000. The yield is 3.40% APY on all eligible balances. Like the savings account, the money market account comes with a free, optional Visa-branded debit/ATM card and free optional checks.

Mortgage Loans

UFB Direct offers a wide range of home loans through Axos Bank:

• Conventional 15- and 30-year fixed-rate mortgages
• 5/1 adjustable-rate mortgages
• FHA loans
• Non-conforming loans
• Refinancing loans
• Home equity loans

Advantages

1. Deposit Checks From Anywhere
   These days, mobile check deposit is pretty much standard at online banks, and UFB Direct is no exception. With UFB Direct’s Mobile Deposit feature, you simply snap a couple of photos with your phone, follow the online prompts, and watch your account balance rise.
2. Highly Competitive Interest Rates
   UFB Direct offers some of the highest yields available. The 3.40% APY base rate on savings accounts far exceeds the national average, and customers can earn an even higher rate of 3.60% through the checking-savings bundle. The 2.00% APY on checking is also exceptionally strong.
3. 24/7 Customer Support
   UFB Direct now offers around-the-clock customer support by phone, a major upgrade from weekday-only availability. Many online banks don’t provide this level of support.
4. Large ATM Network
   With access to over 90,000 fee-free ATMs nationwide and up to $10 in monthly ATM fee reimbursements, UFB Direct customers have excellent access to their cash despite the lack of physical branches.
5. No Monthly Fees on Core Accounts
   UFB Direct doesn’t charge monthly maintenance fees on its savings or checking accounts, regardless of your balance. For comparison, the money market account does have a $10 monthly fee unless you maintain a $5,000 balance.

Disadvantages

1. No CDs
   There’s a major gap in UFB Direct’s deposit account offerings: it does not offer CDs. As CDs are relatively safe and predictable – and typically come with higher yields than savings and money market accounts – this is a big drawback for savers. Some competing online banks typically have at least a handful of CDs of various yields and term lengths.
2. No Retirement Options
   UFB Direct also doesn’t offer tax-advantaged retirement accounts, such as IRAs. This is a significant disadvantage for long-term savers looking to shield their nest eggs from federal taxation. Many online banks, including Synchrony Bank and Nationwide Bank, allow customers to structure money market accounts and CDs as traditional, Roth, or SEP IRAs.
3. Checking Must Be Bundled With Savings
   UFB Direct’s Freedom Checking account cannot be opened as a standalone product – it must be linked to a savings account. This requirement may be inconvenient for customers who only want a checking account.
4. Requirements to Maximize Rates
   While the base savings rate of 3.40% APY is competitive, earning the maximum 3.60% APY requires meeting multiple conditions: maintaining a checking account, setting up $5,000 in monthly direct deposits, keeping a $10,000 minimum balance, and making at least 10 debit card transactions per month.
5. Very Limited Credit Offerings
   Aside from mortgage loans, UFB Direct doesn’t have much in the way of credit products. You can’t get a personal loan, auto loan, student loan, or credit card. Other online banks have a much better selection of credit options. For example, Discover Bank has an impressive lineup of branded credit cards.

Final Word

UFB Direct has a strong lineup of high-yield deposit accounts. The addition of the Freedom Checking account with its 2.00% APY and the ability to boost savings rates to 3.60% through bundling makes UFB Direct more competitive than ever. It’s a great resource for depositors seeking above-market returns on liquid cash, along with 24/7 customer support and a large ATM network.

A checking account that doesn’t require bundling would be nice, as would CDs and a fuller range of loan products, but UFB Direct is great for what it is: a high-yield savings and checking solution for savers who don’t mind online-only banking.