| Author | Reviewed by ✅ |
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| Stephen A. Martin Consumer Finance Contributor, We Heart Stephen A. Martin is a consumer finance expert with extensive experience in personal finance, budgeting, and wealth management. He contributes to lifestyle publications, offering practical advice on managing money, saving, and financial planning. Stephen’s approachable style makes complex financial topics easy to understand, helping readers make informed decisions to improve their financial wellbeing. | James Davidson Editor in Chief/Founder, We Heart James Davidson is the Founder and Editor-in-Chief of We Heart, a leading lifestyle platform he has helmed for nearly 17 years. He has collaborated with top brands such as Audi, Veuve Clicquot, Samsung, and Google. Under his guidance, We Heart has grown from a niche magazine to a widely respected authority on all areas of lifestyle. With a background as a freelance travel writer, James brings a wealth of experience to his editorial work. |
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| Financial Disclaimer: The content provided on this site is for informational purposes only and should not be considered professional financial advice. We encourage you to consult with a qualified financial advisor before making any financial decisions. We Heart is not responsible for any financial losses or damages resulting from your reliance on the information provided. |
It is no secret that having bad credit can throw a monkey wrench right into the hearts of many folks’ financial planning. Things like obtaining a loan, applying for a credit card, or establishing a line of credit with a business can become exceedingly difficult when you don’t have a high credit score.
Many folks may even be able to tell you that opening a checking account with a bank can be troublesome when they have bad credit. This is unfortunate, but it is true. Not having a bank account can make certain tasks difficult, too, like paying your bills, getting paid, and sometimes even getting things set up for employment. Has having bad credit affected your ability to try to open a traditional bank account?
You needn’t to settle for the official way of doing things all the time. There are plenty of ideas you can find for checking accounts for bad credit at LetMeBank.com and other online financial resources; let’s explore a few ideas to help you get a grasp on what you can do if a poor credit score is stopping you from opening up a bank account, and how you can manage your money through other means.
Second Chance Checking Accounts: A huge majority of major banking institutions use a sort of financial background checking system called ChexSystems that helps banks identify potential risky applicants. You could be flagged for things like too many overdraft fees, nonpayment on an account, and more.
This can make it difficult to open a bank account if you have some of these issues on your record. Of course, many banks understand that sometimes, you simply can’t control some of the factors in your life that stopped you from making your payments on time, like unexpected financial emergencies.
Many banks offer what is called second chance checking accounts specifically for people who are flagged by ChexSystems. These second chance accounts help you get a leg up on your finances and offer you many of the same benefits as a normal checking account. Some limitations may be present, however, so make sure you do your research on second chance banking options to see if it is the best fit your financial situation. Look For Banks That Don’t Use ChexSystems
While this is becoming a rarer option, as the biggest majority of banks of financial institutions are using ChexSystems or similar systems to make sure their applicants are up to snuff with their requirements for opening an account, there are still some banks that do not use these background check systems.
What does it mean for a bank not to use ChexSystems? Well, it’s rather simple. This just means that the bank you’re applying for an account with doesn’t pull your past banking history from background checking database.
To these banks, you’ll simply be a clean slate, seeing as how your past history will not be visible to them. If you can find a bank in your local area or online who does not use background screening programs, opening an account with them could be a great way to get a fresh start on your banking.
Clear Things Up With ChexSystems: Much like disputing errors in your credit report, it is possible to file disputes with background screening programs for banks. If you notice any errors in your history and file a dispute, your records will be cleaned up if you are successful. If there are no errors that can be disputed, then you’ll have to wait for five years for the problematic records to fall off, making your record clean once again.
Prepaid Debit Cards: Prepaid debit cards are an option to choose if you have ChexSystems problems that you can’t dispute. Many prepaid debit cards offer some of the same functionalities as regular bank accounts, providing you with routing numbers, management applications, and direct deposit.
Using this solution, you also won’t have to worry about things like overdraft or fees putting you into debt, simply because you fund it beforehand. If your account balance reaches zero, it simply will not work until you put more funds in, or until more money is direct deposited into your account through your employer.
You Have Options: Don’t think you’re out of luck if your bad credit is messing with your ability to open a bank account. Whether you need to dispute ChexSystems, check out a second chance banking solution, or use a prepaid debit card, you still have options when it comes to managing your money.
Bank accounts are almost a necessity nowadays, but that doesn’t mean there are only one set of rules to play by. Keep these ideas in mind if you find yourself unable to open a traditional banking account.
