Discharged bankrupt, why can't I get an ISA?

zAndy1

I was discharged from bankruptcy 2.5 years ago, I now find I have some spare cash each month that I would like to pay into an ISA. Why have I been refused an ISA account due to my bad credit history? Surely it's a good thing that I'm trying to save some money now! Could somebody please explain why it is necessary to credit check somebody trying to open a savings account?! I mean where is the risk for the institution providing the account, it's a savings account!

Thanks
Andy

facingthefuture

No idea - it is the banks that would need credit checked for your savings. A big american one is supposed to be in bother this week so no doubt there will be more banking casualties here too. lso the govt can't do a Northern Rock and bail out them all. I am seriously worried its the finger in the dam thing.

zAndy1

Well, I've managed to set up a cash isa with Egg. I already had an egg card and egg savings account , the egg card was included in my bankruptcy 3 years ago but I could still login to 'Your Money' on the egg website. Anyway I applied for an egg cash isa (decent rate > 6% AER) and I assume that since I'm an existing customer it didn't need to credit check me and I've had an email to confirm my ISA has been set up and it's showing in my list of accounts in 'Your Money'. I'm a bit concerned that my egg credit card is still showing the balance it had at the time of my bankruptcy though and I'm a bit worried if I pay money into my egg ISA they'll stop me withdrawing it or something. Anyway, looks like the only way I'm going to get an ISA this year so I might as well chance it I suppose, if they've accepted my application they can hardly refuse to let me withdraw my money!

Paul_Herring

zAndy1 wrote: »

I was discharged from bankruptcy 2.5 years ago, I now find I have some spare cash each month that I would like to pay into an ISA. Why have I been refused an ISA account due to my bad credit history?

Is that the reason you've been given, or the reason you're assuming?

No banks should be performing a credit check for savings, however they may perform an identity check, and it is perhaps this you've 'failed'?

zAndy1

There is no reason I would fail an identity check, I'm on the electoral roll, lived at this address for over 5 years. The letter I received said:-

'Thankyou for your recent application. Unfortunately after careful consideration we are unable to provide the account(s) you requested.

Our decision is based on information provided by Experian, the credit reference agency.....'

Andy

Ian_W

zAndy1 wrote: »

Our decision is based on information provided by Experian, the credit reference agency.....'

Why not get a copy of your Experian report - they're doing a 30 day FREE TRIAL via Credit Expert. Just remember to cancel after you get the report and it won't cost you anything. If there any any inaccuracies they can be taken up with Experian or the companies concerned.

Personally I can't understand why they would decline a savings account other than, as Paul_H says, on an ID check which is required by money laundering regs. Perhaps you should also contact the bank/bs who declined your application and ask why they need to do a credit check when you were opening a savings account?

Quietgirl

I am a discharged bankcrupt and I have an ISA with Alliance & L. The only places I have had problems with setting up savings accounts has been with Coop and First Direct.

Quietgirl

P.S. I have found that from experience some banks do credit check for savings accounts and ISA's but some only check for identity only. The Cooperative bank who I have my basic bank account with won't let me open a savings account until my bankcrupcy has dropped off my credit file. The Yorkshire bank would not let me open there basic bank account including a savings account because they checked for bankcrupcy. I think some do checks for identity, and some do checks for bancrupcies, it does not matter if discharged or not, until it drops off your file.

zAndy1

The one I was refused was with cooperative bank (who I've had a cashminder account with for 3 years)

Paul_Herring

Quietgirl wrote: »

P.S. I have found that from experience some banks do credit check for savings accounts and ISA's but some only check for identity only.

Why do a credit check for savings? I find this highly unusual, if not irregular.

obsessed_saver

zAndy1 wrote: »

I'm a bit concerned that my egg credit card is still showing the balance it had at the time of my bankruptcy though and I'm a bit worried if I pay money into my egg ISA they'll stop me withdrawing it or something. Anyway, looks like the only way I'm going to get an ISA this year so I might as well chance it I suppose, if they've accepted my application they can hardly refuse to let me withdraw my money!

I've read in other bank credit card agreements that if you hold another account with them, and you owe money on the credit card, they have the right to take the money from your other account to cover your credit card debt.

So, I suggest you get a clarification what happens to the debt on your Egg credit card before putting any money into the ISA. Anyway, you did owe them money, so maybe you should pay them back.