If your credit score has been compromised by events that kept you from paying your bills on time, the last thing you need is a bank that does not believe in second chances.
We all have had times when we have overdrawn our account–that is, had something come through our account, such as a check, that there wasn't enough money in the account to cover.
So many times of that many banks see as undesirable behavior and will not even let you start an account with them to begin with.
Some banks offer a line of credit with a credit card.
But if you do not pass their credit score requirements, they can refuse you.
The key is finding out before you waste a banker's time what that bank's expectations are.
If you don't meet them, don't even waste your time or theirs.
Do an Internet search on banks that accept people with low credit scores.
This article explains further how to choose the right bank for your credit score but choosing a bank should be based on other aspects as well, more info on that can be found in this article: 7 Simple Tips to Choose the Best Bank for You
Things You Should Consider Before Joining a Bank
One of the first items a bank checks is your credit score.
It could be a determining factor on whether a bank chooses to do business with you, or decline.
What some banks will do is a “hard pull” on your credit report.
It is important to ask your bank if it involves itself in this practice as you can lose points on your credit score should a hard pull ever be initiated by your prospective bank.
Also, know that banks have been known to decline certain customers due to discrepancies on their credit report. If they feel that you're a credit risk, they will not want to do business with you.
Stay on top of your credit score. Be honest with yourself. If your score is somewhat low, ask your prospective banking institution if that will negatively affect your application to that bank.
If their credit standards are high, spare yourself the frustration of getting rejected.
Find a bank that is what is called a second chance bank that accepts people who have had problems with overdrafts in the past, or have had bad credit. Such banks are available.
The same holds true for credit card companies. They have been known to do credit checks. If they do not like what they see, they will deny you immediately.
Another thing that will be one of the determining factors which a bank will decide to do business with you is if there are signs of you having banked irresponsibly in the past.
If you have a constant habit of overdrawing your checking account, this will be grounds for some banks declining to let you start a new account there.
A frequently overdrawn account can result in a lower credit score, so as a rule of thumb, make sure there is enough money to cover whatever money you spend, whether it is through a debit purchase, or writing checks.
Other Points to Consider:
In addition to the three credit bureaus, some banks also check Chex Systems or Telechex seeking to see if you have a negative banking history, period. If you do, then they have the option not to accept you.
This may be true even if many years have passed since an unresolved bill, or overdraft history was posted to your account.
The key is to be honest with your prospective institution. If they tell you that yes, they check these sites, then move on to another bank that does not.
Know that some banks will let you bank with them even if your credit is bad, but won't let you into their credit programs if you have low FICA scores.
The question to ask is if your bank has a credit card that will accept people with low credit scores. Such cards do exist.
Keep on top of your credit scores.
Pay any unresolved bills so that your credit score may be raised.
Dispute any mistakes on your credit report.
Be persistent until those are fixed.
For your credit can be the determining factor of a lot of things, including where you work, what you drive, and even where you may or may not bank.