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By Robbie T. James
If you have a low credit score, you are probably used to being charged higher-than-normal interest rates for your credit cards, auto loans, or your mortgage. Or, maybe you are used to getting rejected outright for these very same loans and other credit instruments due to your low score.
Similarly, if you have noticed that you are having trouble getting approved for a new checking account, you may suspect that your credit score is to blame.
Well, you would be correct about your credit score having a negative effect on your ability to qualify for low loan and credit card interest rates. But, you would be incorrect to assume that your credit (FICO) score has anything to do with your checking account applications getting rejected: it doesn’t.
No, your credit score has nothing to do with your chances of getting approved for a checking account. Instead, what matters is a little-known (by the general public) database that banks use to exchange information about bank customers.
If you are looking for no credit check checking accounts, here are 5 FAQs that can help you find the checking account you have been looking for:
1. What is the name of the credit check database that banks use?
A: The name of that little-known banker’s database is ChexSystems. Banks use it in two ways: they report a customer’s name to it if the customer has made some banking mistakes or missteps in the past. They also refer to that same database when new prospective customers are applying for a checking account. If the person’s name shows up there, the application is usually rejected, no questions asked.
2. How do I know if my name shows up in that database?
A: If you have been rejected for one or more account applications, chances are the reason is that your name is listed in ChexSystems. If you want to be completely sure, you can contact eFunds (the administrators of ChexSystems) to find out.
3. What can I do about it?
A: The short answer is: not much! If your name shows up there, it could take years for it to disappear. In the meantime, to satisfy your need for a checking account, your best bet is to find a bank that will accept your application anyway.
4. How can I find a bank that doesn’t care if my name is in ChexSystems?
A: Look for a bank that bills itself as a second chance checking bank. These banks will go out of their way NOT to refer to ChexSystems when reviewing your new checking account application. By not checking that database, they have no good reason to reject your application. Problem solved!
5. What other things should I look for in a new bank that will offer me an account?
A: Once you have found a list of at least 3-5 second chance checking banks, go ahead and make a list of the other things you are looking for in a new bank. For example: do you need them to offer online banking? Is it important to you that they have local branches to serve you? Create a checklist and then research each bank to see how each one stacks up against the others.
The bottom line is that, if your name shows up in ChexSystems, it is not the end of the world. You CAN find a quality bank that will grant you a checking account, regardless of your banking history.
About the Author: Find out how to get a guaranteed checking account at:
Checking Accounts For Everybody
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Source:
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