How to Deal When Denied a Basic Bank Account

November 29, 2012 by My Bank Tracker

BY DEBBIE DRAGON

Bank accounts are a common part of one’s personal financial life but not everyone is eligible to open an account or maintain one they already have. There are a number of reasons you can lose access to a checking or savings account and in the event you do, it is important to research your options for a new place to put your money.

Why Have I Been Denied at the Bank?

It may seem logical to be denied at the bank for a personal loan or a mortgage but if you go in to a branch office or apply online to open a standard checking or savings account, know that you are not guaranteed service if the bank deems you unworthy. The bank will investigate your past activity and if you have a history of writing some rubber checks, been busted for fraud, or have a balance owed on past accounts due to overdraws, you may find yourself rejected.

This is not an uncommon occurrence. There are millions of consumers who have been denied a basic bank account. The information the bank uses to approve or deny accounts comes from a company known as ChexSystems. This company has been in existence for over 40 years and provides the background information on 300 million people. About 80% of banks across the country rely on ChexSystems for account approval (Read “Meet the 5 Faceless Companies that Control Your Money.”)

The consumer reports provided to banks contain:

Details about previous bank accounts closed due to fraud/abuse

Any money owned on an account at the time it was closed that is still outstanding
Details of payday loan history
Summary of bounced checks on previous or current bank accounts

If you are unsure where you stand, you may want to request a free report from the company through their website, Consumerdebit.com. Each consumer had the right to request on free copy a year, much like the major consumer credit reports offered from the credit bureaus. Your credit score is also something else to be considered because while you may be able to get a bank account with a low score, you may be subjected to stricter limitations and higher fees than other account holders.