What You Should Know About Bank Accounts For Bad Credit
Many people require a bank account to ease the management of finances, personal or business-wise. But this may be a struggle for you if your credit score isn’t good enough. If this may be the case, you should apply for a bad credit bank account, specifically created for people who have poor credit score records.
Decided to go ahead? There are two types of bank accounts you may want to consider, a normal bank account or a managed bank account. Normal or basic bank accounts are usually offered free of charge and without a checkbook, but a debit card that you can use to withdraw money and pay for stuff will be attached.
On the other hand, a managed bank account may not require a credit check, but you may have to pay a starting fee for account operation.
What Is A Bad Credit Bank Account?
A bad credit bank account, also known as a prepaid account, is specifically created and open for people with poor credit scores. This set of people may be struggling to be accepted for a normal current account. The current account is available to users without the need to check their credit records. It can give you the ability to perform certain tasks like withdrawing cash, receiving and payments through a direct debit.
Can Anyone Open A Bad Credit Bank Account?
If you have a poor credit score record and still need to open a checking bank account, you may have so many questions to ask. So, let’s start with this relieving news. Having a bad credit score can not stop anyone from opening a bank account. Every bad credit bank account is usually offered by other organizations to financial institutions like banks. Besides, it can be applied for and controlled online.
You may even be accepted for a bad credit bank account immediately without any need for a credit check. Nevertheless, you have to abide by the rules concerning the monthly attached charges and providing identification proof to qualify for a bank account.
Why You May Be Denied A Bad Credit Bank Account
The major reason you may be denied a bad credit bank account is that you may be having an outstanding debt with a bank. Another reason is because of your frequent overdraft record. Confirm your status by checking out your ChexSystems report. You can always get free access to your ChexSystems report when you request it. This will help you identify what bank has reported you in the past, and why.
If eventually, you owe any bank, you just need to negotiate with the bank to pay off the debt.
What Services Do Bad Credit Bank Account Offer?
There are several common services that a bad credit bank account can offer. They include:
- Purchasing stuff online
- Accepting payments
- Withdrawing cash
- Giving access to mobile apps for money management
- Free access to a prepaid card
- Setting up direct debits
Having a poor credit record can be embarrassing and frustrating. Luckily, you can always locate a bank that will not only work with you but will be able to help improve your credit ratings for the next couple of years. When you open that bank account, ensure that you pay every attached fee, avoid overdrafts, and keep your account record in better standing.