What’s the Real Deal with these High Yield Savings Accounts?

So I’ve been looking into these high yield savings accounts that are offering up to 5.05% APY. I know they can cut costs by not offering you normal bank services and only allowing online access, but it still seems a little too good to be true. Are banks really competing that hard to get savers to open accounts with them?

I’m looking to open a savings account so I can start my permanent savings. Following generally good advice repeated over and over in accounting classes and articles, I’m going to take advantage of compound interest and start saving as early as possible. Honestly, I don’t have that much to save now but I’m looking to save a set amount each month, then increase it gradually.

Then I hear from people what you should call them up and verify a lot of details because there’s all kinds of hidden fees. Well I looked at the HSBC Direct site and I looked through the FAQ’s and fine print and I don’t see any signs of these hidden fees. It just seems like I can open a high yield account and start wiring money into it. And when things seem to good to be true, it almost always is. Especially with banks.

So do you have experience with these accounts? Are there hidden or transactional fees? Do they lower your rate a certain period after you open the account?