Credit check to open student checking account?

[Tinkmom]

I've heard that many banks and credit unions are doing credit checks before opening checking accounts. My daughter just finished up at college, got a job and is looking to open a new local checking account. I checked her credit score and it is 635. She has almost no credit history, so I guess that is correct, but is that going to present a problem for her to open a checking account. If it matters, I would also be on the account, and my credit score is in the "very good" range.

She has a savings account at a local credit union that she has had since she was 2 or 3 years old, and we were considering just opening a checking account from that account. Anyone know if they would run a credit check, too? (I guess I will check with them tomorrow, but am interested even in generalities in case they are sticklers for a higher score.) I also have a checking account that I set up long ago to use for paypal, etc. that I didn't want linked to our regular account. I rarely use it but it is open. Maybe it would be simplest to just add her to that account . . . this is kind of weirding me out, but I really don't want her to be rejected from opening a checking account.

 

[SandrA9810]

When I opened a joint account with kari, they ran our credit reports. I didn't have much of one, and hers was decent. Had no issues with the credit union. She was also a member of their kids saving account plan from when she was a little kid, which she still has open and uses. There's a way to link accounts for transfering money between online, and when we registered her savings account to the joint, it showed there was a checking account attached to it. And she never even opened a checking account for that one.

I highly doubt she'll have any issues at all for getting an account on her own. Trust me, if my mom can open a checking account with no problems... any one should be able to.

 

[msmayor]

My daughter opened up a checking account at 18 and to my knowledge, no credit check was required at all.

 

[Tinkerbelle9980]

I know the ones in my area do this with out of state students. They are looking for problems, not lack of history generally. Some students do not know how to manage an account. The bank can only do so much. We used to get this all time. Fresh out of high school open a new account and spend way more than they ever had in the account. I doubt she would have a problem getting an account, especially with you as a co-owner. Good luck!

 

[Sadie22]

You said your daughter just finished up at college? Do you mean freshman year, or has she quit or graduated? If she is done with college, she may not be eligible for a student account any longer. If she is returning to college in the fall, she will want to look into what banking institutions have branches on or near campus. That makes it a lot easier when she wants to withdraw a little cash. There can be fees associated with cashing checks, and many institutions will not cash checks for someone who does not have an account with them.

At 17-18 son opened a student account with me as an authorized person on the account just so I could view his account on my list of accounts online and make transfers into his account if needed. It was not required that he have a cosigner. No credit check was run and it was not required to have anyone else on the account. He could have kept the student account throughout graduate school if he desired, but after X years the bank would begin charging a monthly fee.

Unless she has done something (late credit card payments, etc.) to have a lower credit score, a student would not be expected to have a high score. She would have little to no credit history on which to build a score.

If your daughter is out of college, i.e., graduated or will not be returning, she should probably first approach her credit union that has her savings account. She can easily transfer funds between the two accounts. I am sure with her new job that a credit union or bank will want to receive her pay checks for her. If direct deposit of pay checks is offered by her employer, she should enroll in that once she has her checking account set up. Some banking institutions offer free checking or other perks for direct deposit.

 

[monarchsfan16]

The summer before I started college I opened my own checking account. No mom and dad on it; their rule is that we need to have our own accounts to be responsible for ourselves (and to also probably not mess up their history). I had NO credit history since I was 18, and had NO problems whatsoever. It was NOT a student account.

If the CU where she has a savings account is convenient for her, it certainly wouldn't hurt to start there, since she has a history there, but as long as there aren't negatives on her report, she should be fine anywhere. And she shouldn't need to open a student account (and as others have mentioned, if she's done with school, she's not eligible).

 

[dd50]

If they do check she should be OK.

 

[Tinkmom]

The summer before I started college I opened my own checking account. No mom and dad on it; their rule is that we need to have our own accounts to be responsible for ourselves (and to also probably not mess up their history). I had NO credit history since I was 18, and had NO problems whatsoever. It was NOT a student account.

If the CU where she has a savings account is convenient for her, it certainly wouldn't hurt to start there, since she has a history there, but as long as there aren't negatives on her report, she should be fine anywhere. And she shouldn't need to open a student account (and as others have mentioned, if she's done with school, she's not eligible).

She also opened a checking account four years ago, before she started college, with no problem (but no credit check). The credit check appears to be a recent addition to the application process. Many of our area financial institutions have "student checking", i.e., no fee, no minimums sort of thing for anyone up to age 23 or 24, so she would "qualify" on that, but I still don't get the logic of a minimum credit score when many, if not most, perfectly responsible people are not going to have the credit history to meet the minimum score.

I called our credit union and they do a credit check PERIOD -- brand new account, adding checking to existing savings account or even if I simply add her as a co-signer to my account. They have a minimum required score of 650, sort of. It was like "Well, we require a score of 650 to be able to write checks." "Even as a co-signer on my account which has been open for more than 25 years?" "Well, they probably won't require a minimum score then but they will pull a credit report." Sigh, this seems ridiculous. I hate banks more and more every day, and will be so happy when more of the regulations kick in in a few months to stop at least a few of their predatory practices. (I do realize that there are some perfectly respectable banks out there, but unfortunately I see more and more bad practices by banks.)

She may just keep her out-of-town account for a while, then see if her credit score magically raises to the "proper" level.

Thanks for the input.

 

[JB2K]

Only a small number of banks pull credit reports for new account openings.

Most other banks and credit unions, OTOH, pull from "Chex Systems" which is a verification service of sorts to ensure the prospective customer doesn't have a history of "bad banking" (for choice of better words).

 

[*pixie*dust*]

Most financial institutions are pulling BOTH Chexsystems and a Credit Report prior to opening a checking account. With a poor economy and increased regulation for identity theft and OFAC reporting, it is much more the norm than the exception.

 

[Tinkmom]

Most financial institutions are pulling BOTH Chexsystems and a Credit Report prior to opening a checking account. With a poor economy and increased regulation for identity theft and OFAC reporting, it is much more the norm than the exception.

This appears to be the case. I still don't get the real liability for a bank to add checking "privileges" for a long-time customer.

 

[dd50]

Most financial institutions are pulling BOTH Chexsystems and a Credit Report prior to opening a checking account. With a poor economy and increased regulation for identity theft and OFAC reporting, it is much more the norm than the exception.

That is what happened to me when I opened a new checking account in the same credit union that had had (still have) my other checking and savings accounts with for 20 years.