Basic bank account application - credit search?

TinyPomegranate

This might be one of those questions where I'm just overthinking and really really don't want to get into trouble. I've been bankrupt about a week.

I do have a basic bank account with the Co-Op already that I've had for many years, and had already arranged for my salary to go in there. But just in case it doesn't, or there's a problem, I thought perhaps I'll open a "spare" basic account with someone else. Also it would help me with budgeting going forward if I have 2 accounts to use. If it matters, I'd rather use a traditional bank like Lloyds or Barclays rather than an internet one like Monzo etc. So I started looking at which banks do basic accounts, and found a running theme. Most of them say "you can't apply for this basic account directly, you have to first apply for our current account (with overdraft and perks) and then we will decline you and give you the basic account".

My worry is, will it look to the OR like I'm trying to apply for credit by applying for a normal current account? I know they'd be able to see a credit search. Obviously I don't want the overdraft facility etc, and I'm certain I'll get rejected of course, which is the whole point because it's upon rejection that they offer you the basic account. But I don't want it to look like I'm trying to apply for overdrafts because obvoiously going against the terms of the bankruptcy is a very serious matter. Or should I tell the OR in advance that I'm applying in order to be rejected and receive a basic account?

NewLeaf1986

The OR won't care. A basic account isn't a credit facility.

The Nationwide FlexBasic account is an excellent account to have in your circumstances and is far more full featured than your CoOp account. I've had one for a while now and am very happy with it.

They will leave a credit search footprint, and it doesn't matter if they do. You're fine 😉

TinyPomegranate

NewLeaf1986 said:

They will leave a credit search footprint, and it doesn't matter if they do. You're fine 😉

Thanks so much!

Sonic101

Hi TinyPomegranate
Even if you had been applying for actual credit, as long as you didn't actually take any out you I doubt you'd get into trouble. 
I wasn't keen on the idea of internet only bank account but I have a Monzo one just for spending and find it very easy to use. I'd also recommend Nationwide. 

Minkym00

Sonic101 said:

Hi TinyPomegranate
Even if you had been applying for actual credit, as long as you didn't actually take any out you I doubt you'd get into trouble. 

This is a common misunderstanding. It’s not illegal to take out credit. The law just says that you have up to inform the lender that you’re bankrupt if you borrow more than £500, that’s all. 

Sonic101

Minkym00 said:

Sonic101 said:

Hi TinyPomegranate
Even if you had been applying for actual credit, as long as you didn't actually take any out you I doubt you'd get into trouble. 

This is a common misunderstanding. It’s not illegal to take out credit. The law just says that you have up to inform the lender that you’re bankrupt if you borrow more than £500, that’s all. 

Yes - I wrote that thinking that the OP was referring to applying for bank accounts prior to bankruptcy.

TinyPomegranate

Minkym00 said:

This is a common misunderstanding. It’s not illegal to take out credit. The law just says that you have up to inform the lender that you’re bankrupt if you borrow more than £500, that’s all.

My bankruptcy paperwork says I must inform them if I want to take out more than £500 of credit, and that I need to tell the person I'm asking for credit that I'm an undischarged bankrupt. My question was more about the fact that the basic account providers seem to force you to apply for credit even if you don't want it in order to get declined and then get offered the basic account. I couldn't find a way to apply for a basic account directly and it even states this on some bank websites. So I didn't want it to look like I was hiding anything from the OR. Probably like most people, I really, really don't want to flip this up over a simple mistake

Sonic101

TinyPomegranate said:

Minkym00 said:

This is a common misunderstanding. It’s not illegal to take out credit. The law just says that you have up to inform the lender that you’re bankrupt if you borrow more than £500, that’s all.

My bankruptcy paperwork says I must inform them if I want to take out more than £500 of credit, and that I need to tell the person I'm asking for credit that I'm an undischarged bankrupt. My question was more about the fact that the basic account providers seem to force you to apply for credit even if you don't want it in order to get declined and then get offered the basic account. I couldn't find a way to apply for a basic account directly and it even states this on some bank websites. So I didn't want it to look like I was hiding anything from the OR. Probably like most people, I really, really don't want to flip this up over a simple mistake

You have taken a massive step and on the road to recovery and you don't want anything to come along and jeopardize that. I am the queen of overthinking and tend to worry unduly about stuff.  
I would imagine that the OR will be far too busy look at what searches have been carried out on your credit reference file - and  even if they did and it was questioned, you haven't done anything wrong. You would simply inform them that the searches were carried out while you were applying for basic bank accounts - this is a perfectly honest and acceptable reason. 
Today you are one day closer to discharge. :-:smile:

TinyPomegranate

Sonic101 said:

Today you are one day closer to discharge. :-:smile:

This is the best thing anyone's said to me for months

ThisnotThat

Probably worth adding as it hasn't been brought up yet that many banks will not allow you to open a basic bank account if you already have one, whether with them or someone else.

Nationwide was brought up and they don't appear to have that restriction but if you're applying elsewhere it'd be a good idea to check they don't have this restriction.

NewLeaf1986

ThisnotThat said:

Probably worth adding as it hasn't been brought up yet that many banks will not allow you to open a basic bank account if you already have one, whether with them or someone else.

Nationwide was brought up and they don't appear to have that restriction but if you're applying elsewhere it'd be a good idea to check they don't have this restriction.

Tbh I don't know of anyone who enforces this restriction, maybe Co-Op do, I haven't asked them, but TSB, Nationwide, and HSBC are all happy to open a basic account to someone who already has one.