Banks for Bad Credit (Top 10)

Are you tired of your employer asking you to enroll in direct deposit? They think that you prefer cashing your check at the grocery store and running around with cash in your pocket every payday. What they probably don’t know is that banks do a credit check, and with your bad credit, it limits you from having a bank account, also due to poor banking history. Having bad credit and not being able to take advantage of online banking makes it a lot more challenging to conduct financial transactions daily due to our electronic banking society.

While you work to build your credit score up to an acceptable number, you may feel that living without a bank account will last a lifetime. While it may feel this way due to poor banking history, there are some second chance banking options out there for you.

You Need a Bank Account to Make Your Life Easier

Due to your bad credit and banking history, you are probably using a pre-paid debit card for online purchases, cashing your check at the grocery store every payday, and having to buy money orders to pay your bills. When you have to manage your money this way, it becomes time-consuming. Here are some reasons why having a bank account with a checking and savings account makes your life easier:

  1. You can save money and time by paying your bills online or with personal checks.
  2. Have money deposited and readily available on your checking account debit card when you need to make purchases at any time.
  3. Your money is deposited by your employer for you into your account with a set up for direct deposits. Having a direct deposit allows you to take a day off on payday and eliminates lost or delayed checks in the mail.

Banks Have Accounts that Give You a Second Chance

Some people decide not to have a bank account for a variety of reasons, but if your only reason is due to your bad credit and banking history, then I have good news for you. There are many banks out there that will give you a second chance checking account even with your bad credit score. These accounts come with more stipulations or lack of services than usual, but at least it allows you to have a debit card and bank accounts while, in the meantime, you work on building your credit.

10 Best Banks for a Fresh Start

A bank account can give you a fresh start and a second chance, allowing you more time to focus on other financial priorities. Here is our list of the 10 Best Banks.

1.BBVA Bank

BBVA Bank is a leading major financial institution that offers a variety of second chance banking products to people looking to rebuild their credit. You can read more about banks that don’t use chexsystems here. Specifically, they provide a second chance checking account called the Easy Checking account.

How to Get Started:

  • You first apply for a Free Checking account; if you do not qualify after a credit check, you will be offered to open a second chance checking account called the Easy Checking account.
  • After 12 months, you will be allowed to upgrade to the Free Checking account if you keep an active status and a positive balance.

Features and Fees:

  • A minimum opening deposit of $25 is required to open a second chance checking account.
  • There are no fees at BBVA USA ATMs or those ATMs belonging to the AllPoint network of 55,000 and more.
  • There is no fee for online and mobile banking, mobile deposit, and bill pay.
  • You are allowed to write an unlimited amount of checks out of your checking account.
  • There is a monthly service charge of $13.95.
  • Paper statements are $3.00 a month but can be waved with enrollment in electronics statements.

2. Chime

Chime second chance banking is an award-winning mobile app and debit card. Chime’s profits come from you using a debit card; they don’t make their money on charging you any hidden fees. They are all about protecting their members by making no profit off of you directly.

How to Get Started:

  • To apply, you will need to enter your email address. Applying for a second chance checking bank account takes less than 2 minutes. Then you will open banking account online.

Features and Fees:

  • Chime doesn’t check your credit report or uses ChexSystems, which is a consumer reporting agency that banks often use to determine your eligibility for a checking or savings account.
  • You can create positive financial habits by automatically transferring money to your savings accounts on every transaction. It is also possible to deduct a percentage of every direct deposit and transfer to your savings.
  • There are no hidden balance requirements, or overdraft and monthly fees.
  • You can receive your direct deposit up to two days earlier than you would with traditional direct deposit features.
  • You can take advantage of all the elements and features in their mobile banking app.
  • You will receive a debit card for your checking account.

3. GoBank

Similar to Chime banking, GoBank is also an award-winning online mobile banking app. They are known for having a variety of online banking features that are easy to use.

How to Get Started:

  • It is simple to sign up; by providing personal information; you can get started with a second chance checking account right away.
  • Or you can buy a kit at a participating location and activate your debit card and accounts online for a small price.

Features and Fees:

  • They offer an extensive fee-free ATM network of about $100,000 locations. If you use out of network ATMs, the charge is approximately $3.00.
  • You can receive your direct deposits into your checking accounts for up to two days in advance.
  • You can deposit cash into your accounts at select locations for a small fee.
  • You are allowed to pay anyone with personal checks out of your checking account.
  • Deposit money into a “money vault” to save for unexpected emergencies.
  • There is no credit check initiated when you apply.
  • They offer features like “fortune teller” and budgeting assistance to help you manage your money.
  • Have qualifying direct deposits of $500 a month or more to avoid an $8.95 monthly service fee.
  • Take advantage of an open online account bank feature such as bill pay.

4. Fifth Third Bank

Another option is Fifth Third Bank Express Banking. This bank is well established. They offer a simple way to have a second chance checking bank account for those with bad credit.

How to Get Started:

  • To open a checking account, you will apply and answer a few personal questions.

Features and Fees:

  • You can earn discounts on fees the more you use their qualifying services, which puts you into tier-levels.
  • There is a cost to receive cash immediately in hand or same-day availability in your bank account; there are also tier levels you can move up with, which reduces the fee amount.
  • There are no monthly service charges.
  • There are no balance requirements.
  • There are no overdraft fees.
  • You are not allowed to write checks from your checking account.

5. Wells Fargo

Wells Fargo is a large, well-known bank with multiple locations across the country. Opportunity Checking is an excellent solution to those with bad credit in need of a second chance checking account.

How to Get Started:

  • To apply for an Opportunity Checking account with Wells Fargo, you will first apply for an Everyday Checking account. If you are unable to qualify, then you will be given the option to open an Opportunity Checking account.

Features and Fees:

  • Eligible to use standard banking features such as online and mobile banking, checks, and bill pay.
  • To open an account, you need a minimum opening deposit of $25.00.
  • There is a $10.00 monthly service fee, but it can be avoided by following one of their guidelines, such as maintaining a minimum balance, enrolling in direct deposit, and more.
  • You are eligible to enroll in overdraft protection for your checking account with Wells Fargo, which draws from a savings account, credit card, or line of credit to avoid overdraft fees.
  • You will receive a debit card for your checking account with Wells Fargo bank.

6. America’s Credit Union

Banks are not the only financial institutions that have options for those in need of a bank account due to bad credit; America’s Credit Union has an Opportunity Checking account to assist you with your need.

How to Get Started:

  • You have to meet eligibility requirements to become a member of the credit union by being employed by a participating employer or by being apart of a qualifying group.
  • Once you are a member, you can enroll in the Opportunity Checking account.

Features and Fees:

  • If you have direct deposit, then your monthly service fee is $8.95. If you don’t have direct deposit, your monthly service fee is $10.95 per month.
  • There is no minimum balance requirement that needs to be maintained.
  • You are eligible for access to mobile and online banking features for your bank accounts.
  • You can use 10 non-credit union-owned ATMs for cash withdrawals from your bank accounts for free.
  • You can be eligible to upgrade your checking account after 12 months with less than 12 non-sufficient funds notices.
  • You will be given a debit card to use for your checking account.

7. Bank of America

Bank of America has banking accounts with features that assist you with staying within your account balance. If you have bad credit and are looking for this type of account, look to the Advantage SafeBalance Banking.

How to Get Started:

  • First, you can take a quiz to see if the SafeBalance account is right for you.
  • If you determine that it is, you can apply for a checking account online.

Features and Fees:

  • SafeBalance Banking offers features to help you only spend the money you have available in your checking account.
  • You are not eligible to write checks out of your checking account.
  • There are no overdraft fees.
  • There is no monthly fee only if you qualify as an eligible student.
  • You can have access to mobile and online banking features for your accounts.
  • You will be given a debit card to use for your checking account.

8. Radius Bank

Known for its digital banking platform, Radius Bank is a financial institution that offers a checking account to those who have bad credit and want to take control of their finances.

How to Get Started:

  • To apply for an Essential Checking account, you first need to try for their Rewards or Superhero checking accounts. If you do not meet the qualifications for these accounts due to your bad credit, then the Essential Account will be available to you.

Features and Fees:

  • There is a $9.00 monthly service charge.
  • You are only allowed to spend up to $500 a day from your checking account on your debit card.
  • There are restrictions and limits on mobile app check direct deposits.
  • You are eligible to upgrade to a regular checking account after 12 months of positive banking history.
  • You can take advantage of online banking features and money management tools on their financial dashboard.

9. Aspire Federal Credit Union

Aspire Federal Credit Union offers a fresh start checking to those with bad credit who are having a hard time getting approved for an account.

How to Get Started:

  • To apply for a checking account and to see if you are eligible to become a member, you will need to call the Aspire Federal Credit Union customer service number.

Features and Fees:

  • There is no monthly fee.
  • It is mandatory to direct deposit all of your paychecks into your account.
  • There are no ATM fees when using one of their surcharge-free ATM networks.
  • You can have access to online and mobile banking features for your accounts.
  • You will receive a debit card to use for your checking account.

10. Unify Financial Credit Union

The Right Start Checking Account at Unify Financial Credit Union will give those with bad credit a second chance at rebuilding your finances.

How to Get Started:

  • To qualify for membership at the credit union, you will need to be eligible through your employer. If you are not eligible, then you will need to donate to one of their affiliate partners to join.
  • Once you become a member, you can enroll in the Right Start Checking Account.

Features and Fees:

  • You only need a $25 opening deposit to open your account. After that, there is no minimum balance requirement.
  • There is no monthly fee.
  • There is no fee for overdrafts out of your checking account as long as it transfers from your savings account or qualifying loans.
  • You are eligible for access to online and mobile banking features for your accounts.

What are the Best Features of These Accounts?

You have just been given a lot of information. Here is a list of the features to look for:

  • No hidden fees; you will want to verify that if you are going to chose a bank with a monthly fee or a fee that can be waved that you understand it. One of the steps to becoming financially stable is to be aware of your spending, and an extra $10 fee per month that you weren’t expecting could be frustrating.
  • No outrageous minimum balance requirements. If you live paycheck to paycheck or budget every dollar in your account, then you know that you won’t be able to keep a minimum balance that is too high.
  • If offered, no overdraft fees can be a lifesaver. Sometimes we make mistakes and forget about a bill coming out of our account before payday resulting in an overdraft.
  • You want access to online banking features. With our digital world, having access to your account balance, being able to transfer money, and pay bills online makes your life easier.
  • If you can find a bank that offers an extensive network of no-fee ATMs, this can make getting cash simple and more convenient without having to spend a fee.
  • With bad credit history, you will want an account that offers support. Support could be financial programs, budgeting assistance, and features to help you save money. Taking advantage of these will help educate you on financial management and get you working on improving your situation.

Don’t Let Bad Credit Stop You From Getting a Bank Account

After reading through our list of the 10 Best banks, you may have discovered that there are options for you. If you have bad credit, then most likely you are working hard to build it back up.

Looking for a bank that will work with you and offer features and products to help you be a better manager of your money will benefit you. Some of these banks give you the option to enroll in their regular accounts after 12 months of good behavior. It takes time, but that is progress towards your financial goals!

Look for banks That Don’t Use ChexSystems

If a bank or a credit union offers a fresh start, opportunity, or second chance checking, they are most likely not using ChexSystems to determine your eligibility. These accounts are meant for people who have had a rough financial past and need an account to help them progress faster.

When reviewing the features of these accounts online, check for disclaimers on what they do with your personal information. Another place to see this is after hitting the enroll now or apply online button to see how they are going to use your data. If all else fails, call them to find out what their requirements are.

Review Your ChexSystems Report

If you are unsure what may be on your ChexSystems Report, consider applying for a disclosure of what is listed to be aware of what a financial institution will see when pulling this report. If you have recently been denied, you will be able to see more information individually as to why you were denied.

If you review your report and know that your file’s information is not accurate, you can submit a dispute to have your information updated.

Do You Want More Options? Here’s How to Find Them:

After reviewing our top 10, maybe non of the bank accounts listed interest you or are the best options for your situation. For example, some are just looking for online banks, so you can read our post on online checking account no chexsystems.

You could also reach out to your local banks and credit unions and find out if they offer bank accounts to those with bad credit or to those unable to enroll in a regular account. See our recent guide on opening a savings account for bad credit.

Take Advantage of Your Second Chance

If given the opportunity to enroll in multiple bank accounts, take advantage of it! Not only is getting new accounts a second chance but so is rebuilding your credit. You can also see this related post on Chexsystems removal.

How a Credit Score is Determined

According to my FICO, your credit score is calculated by the following percentages:

  • 35% Payment History
  • 30% Amount Owed
  • 15% Length of Credit History
  • 10% New Credit
  • 10% Credit Mix

Take Simple Steps to Build Your Score without Debt

Use this example as a simple way to build your credit score:

If you have a credit card, set up an automatic withdrawal for your phone bill to charge your card. Then have an automatic bill pay from your checking account to pay your credit card bill. Paying off your credit card bill builds an excellent score:

  • Paying your credit card bill shows the credit bureau that you pay your bills on time.
  • Your total debt will be minimal, so you aren’t using the full line of credit, improving your score, and eliminating the stress of debt.
  • If you continue to repeat this action, your score will improve significantly.

Other ways to build credit include:

  • Avoiding hard inquiries on your account by not applying for credit if it is unnecessary.
  • Paying off debt and keeping debt balances low.
  • You are paying your bills on time.

Be Mindful of Your Spending Habits

With second chance bank accounts, you will want to avoid ruining the relationship with your financial institution by consistently over-drafting your account. Many banks are willing to upgrade your account once you have proven your financially stable, and having insufficient funds will take that opportunity away.

It is possible that after over-drafting too many times with your second chance account that your financial institution may want to cut ties in their relationship with you. Not keeping a good relationship with a second chance checking account may also report additional information to your ChexSystems report.

Make a list of all of your monthly, quarterly, and yearly bills. Write down your monthly income and look at your bank account on a daily or weekly basis. Writing down what comes in and goes out is the start of budgeting! Budgeting will help you be mindful of your spending habits based on the amount of money you can spend.

It is Okay to Make Mistakes, Learn From Them

Making mistakes is a way of life for the human race, but the focus shouldn’t be on the error. The focus is on how we fix and learn from our mistakes.

Don’t feel discouraged or let your bad credit stop you from getting an account, though. The immense amount of options out there for you may be limited now, but that doesn’t mean you can’t ever get an account. Maybe you are worried that you will mess up again. That’s okay, acknowledge that worry and strive to do better. Take advantage of the tools the banks are offering, have someone keep you accountable, and think of the future you could have if you push through this hard time.

Not being financially stable can be tough, based on many circumstances. You may not make enough money to pay all of your bills, or have a hard time not spending money on things you don’t need when you know that you can’t afford it. Admitting that you have a problem with these habits or circumstances is the first step in improving your financial situation for the better. Decide for yourself that you are going to make a change and go for it! See our recent post on banks that offer early direct deposit.