A broken piggy bank

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Bank accounts are easier to get approved for than credit cards, but it is still possible to get denied for one if you have a bad credit history. But don’t let rejection deter you—there are other ways to secure a checking or savings account.

Know why you were rejected

If you were rejected, it’s likely due to something bad in your credit history. Services like the ChexSystems or Early Warning Services consumer reports look for “negative actions” that include:

  • Bounced checks
  • Unpaid fees
  • Credit inquiries
  • How many checks you’ve ordered
  • Instances of check fraud and identity theft/fraud
  • Unpaid negative balances
  • Excessive withdrawals

Once you know what negative actions have led to your refusal, you can make sure they are legit and then start working to correct them.

Ask the bank to reconsider

While bankers use consumer reports to prescreen applicants, they’re free to approve or reject new accounts as they see fit. You might be able to get the bank to reconsider its decision and allow you to open an account. Also remember that federal law requires these institutions to disclose why you were rejected, so do ask for that information, too.

Get a copy of your report 

If you can’t get the bank to reconsider, request a copy of either your ChexSystems’ or Early Warning Services report. You’ll need only your current address, Social Security number, and the address of your residences from the past five years to do so. After you fill out the request form, the report will be mailed to you within five business days.

Check for errors in your report and dispute them 

Next, review your reports for any fraudulent activity or discrepancies, as you might just be a victim of error or even fraud. If you review your report and see any incorrect or out-of-date information, you can also submit a dispute with either ChexSystems or Early Warning Services, as well as your financial institution.

However, if your report is accurate and you do owe money, you’ll need to pay those debts before they can be taken off the report. Otherwise, negative entries can remain on your report for up to five years.

Look into “second chance” accounts

Some banks offer second chance accounts for those with a poor credit and banking history. For these accounts, banks don’t look at your consumer report or negative activities when qualifying you, so it’s easier to get approved. As a result, though, the fees tend to be higher. Another option is applying for a bank account with a credit union or smaller bank, as some of these do not subscribe to ChexSystems.

Temporarily use a prepaid debit card

If you’re still struggling to open a bank account, apply for a prepaid debit card, which must be pre-loaded with a certain amount of cash. The card offers some of the functions of a regular bank account, such as bill-paying and transferring money to other people. Over time, you can pay down debt or wait until your “negative actions” expire, so they no longer appear on your consumer reports.