The ability to qualify for a credit card is something that most people today desire. We are increasingly living in a credit-based consumer society. Cash is used less and less often in brick-and-mortar stores, and it can not be used at all to make online purchases. To be sure, credit card and debit card use is on the rise while cash and check use are both on the decline.
Despite the almost-universal desire for a card, there are millions of people who continue to have trouble qualifying for one. Many people who have a bad credit score have tried and failed to get qualified more than once, while others have been rejected because they do not have a checking account.
If you are interested in finding credit cards with bad credit and no checking account, here are the answers to 5 frequently-asked-questions that can help guide your decision:
1. Does every credit card company require applicants to have good or excellent credit?
A: All card companies base the interest rate that they charge a customer on that customer's credit rating, at least in part. However, not all credit card companies will actually reject someone's application outright just because of their credit score. There are many credit companies who will issue a card to anyone – even someone who has declared bankruptcy recently.
2. Do I need to have a checking or savings account in order to qualify for a credit card?
A: The majority of credit card issuers will want you to have a bank account – such as checking or savings account – in order to approve your application. The existence of a checking account adds a layer of jurisdiction to the person's creditworthiness.
3. Why do I have so much trouble opening a checking account?
A: If you need a checking account but have been unsuccessful in qualifying for one in the past, this could have due to your name having been reported to Chex Systems.
4. What is Chex Systems?
A: This is a database used by banks to report high-risk bank customers to each other. It has nothing to do with your credit score. Rather, you are likely to be reported to Chex Systems if you have, for example, overdrawn your account while a customer of a given bank and then left that bank without repaying them. Other reasons may include check fraud, having numerous bounced checks, etc.
5. How can I open a checking account if my name is in Chex Systems?
A: Once your name is in Chex Systems, it is illegally that it will be removed from that database for years to come. Fortunately, people whose names are in this database can still get a checking account by seeking out second chance checking banks. These banks promise to never refer to Chex Systems when considering a new account. That is actually their business model.
In summary, if you need a credit card but are concerned about the bank account requirement, consider approaching a second chance checking bank online and setting up a checking account. Then, go back and apply to the credit card company again. Even with a bad credit score, you should be able to get qualified for a credit card quickly with no hassles.