Checking Account For Bad Credit
Having bad credit can mean trouble when you open a checking account. Whether online or at a local branch, some banking institutions will look at your credit history before approving a checking account application. If you have a history of overdrafts they may deny you all together, even more so if the outstanding amount and bank fees were never taken care of. Your credit score, and that of your spouse, could also play a huge role in opening a checking account. If you are in doubt about your credit score or if you have any outstanding debts you can request a copy of your credit report once a year for free from the three credit bureaus.
Establishing a checking account with bad credit is not impossible but some institutions may charge you a monthly monitoring fee or require you to put a deposit down to ensure that you won`t overdraft the account and renege on your contractual agreement. If this is the case, the money will not be available to you until you have established a solid history with them. Some will offer you a small interest pay out on the money that is being held but most institutions won`t. Bad credit can also plague the approval process when paying for things with a check. If your name is still in one of the check approval systems as being a high risk, your purchase could be denied without recourse.
Several online banks offer `no credit check` accounts; you will need to provide basic information like your name, address, social security number, date of birth and at least one form of verifiable identification such as a utility bill. You will have to send them a certified money order or do a wire transfer of funds once your application has been approved. The fees for opening an online bank account will vary on several things, one of them being your payment history. While most online banks claim that they do not do a credit check they do; it is one of the ways that they verify your identity. They disclose that during the online application process but say that the results of the credit report won`t effect your application or associated fees.
Online banks offering free checking services for those with bad credit often skirt the issue of application fees, processing fees and monthly management fees. If you opt to have a debit card attached to the account they can charge you a monthly fee for that as well as another fee for each transaction. While an offer to open an online banking account may look attractive, especially for those with poor or bad credit, the costs that come with it can be harsh. The best solution to attaining a checking or banking account while having poor credit is to find a bank that is willing to work with you. There may be no way around putting down a deposit that will be held in escrow but you can shop around for an institution that isn`t going to charge you for ATM withdrawals, customer service calls and online account balance requests.