If you have tried and failed to open a bank account, you are not alone. In the current economic climate, many of us have a credit history that we’d rather keep to ourselves. Default payments, CCJs, Bankruptcies, IVAs, Debt Relief Orders, Trust Deeds… the list goes on. Unfortunately, when you attempt to open a bank account, that list of financial indiscrepancies is exactly what your potential bank account provider is looking at. If your credit history contains one or more of the aforementioned ‘hiccups’, you may well find yourself on the wrong side of an acceptance – in other words, rejection.
While being rejected is never pleasant, and lets face it, rejection isn’t something we’d ever choose to experience, it isn’t the end of the world (and it isn’t the end of your hopes of getting a bank account).
Unless you’ve ever experienced bad credit & the financial obstacles that go with it (you’re probably happy as Larry (who is Larry btw?) with your high street account with all it’s fluffy benefits), you may never have even heard of a Bad Credit Bank Account (sometimes referred to as a Basic Account). Nevertheless, these bank accounts have been available for many years now & have been providing a fantastic service to the ‘credit challenged’ members of the public.
‘Basic’ overview (clever, right?)
These bad credit / basic accounts have one major feature… (can you handle the suspense…?). Seriously though, the major feature is that they do not require a credit check to set up. In other words, it doesn’t matter what skeletons are hiding in your credit history (Default payments, CCJs, Bankruptcies, IVAs, Debt Relief Orders, Trust Deeds… it doesn’t matter), they can stay hidden. With most accounts, all you need to set one up is a form of identification & you’ve got your very own bank account.
In the past, these basic accounts were just that… basic! They offered very little in terms of service & sometimes you couldn’t even access your money without phoning. These days, though, many bad credit bank accounts have virtually all the features of a standard ‘high-street’ account (an overdraft, a card to use in shops, bars, restaurants, cash withdrawals…etc).
Another great feature is that you won’t have to worry about unauthorised overdraft fees (a source of much concern with many standard accounts). These bad credit accounts are generally split into two separate accounts – one which all your bills are paid out of (you don’t have access to the cash in this account) & one that contains your surplus money – the money that you can spend on whatever you like. Generally, you’ll also get an account manager who will help you manage your money better too. They will work with you to make sure that all your bills are paid in full & on time (improving your credit rating) and making sure you have access to the money you need in your 2nd account.
So the moral of this article is, don’t despair. While being rejected by a high street account provider may feel like a kick in the teeth, you can get a pretty good alternative (some might say better) quite easily & with a minimum of hassle. There are many companies who provide these no credit check accounts, many offering different levels of service, features & fees. It certainly pays to do your research & find the one that suits you best.