How bad does your credit score have to be to be refused a bank a/c?

buel10

Hi all.
Best mate missed a few payments on credit cards before Christmas and tried to open a bank a/c with Lloyds last week but thinks he seen the message that he was refused due to his credit score? (he currently has two bank a/cs with HSBC)
I thought things have to be pretty damn bad before one is refused a bank account, as in CCJs, etc?

Emmia

Lloyds is free to take on the customers it wants, and perhaps it doesn't want customers with missed payments in the recent past. It might also depend on the type of account applied for - was there an overdraft facility etc.

Volcane

HSBC declined me despite a clean and healthy credit report so I guess customer profiling has a large part to play.

GeoffTF

Open a basic bank account:

https://www.moneyhelper.org.uk/en/everyday-money/banking/basic-bank-accounts

https://www.moneysavingexpert.com/banking/basic-bank-accounts/

buel10

Volcane said:

HSBC declined me despite a clean and healthy credit report so I guess customer profiling has a large part to play.

Wow!!!! That has surprised me.

buel10

And I assume that applying for a bank a/c is 'seen' as a search, therefore, a negative on one's credit score?

MorningcoffeeIV

You can get a bank account with any CRA credit score. They're not used in lender criteria. The only score that matters is the one a lender gives you, which you won't see.

It's all about credit history and current circumstances.

A search in itself isn't a negative factor in lending decisioning.

WillPS

buel10 said:

And I assume that applying for a bank a/c is 'seen' as a search, therefore, a negative on one's credit score?

The latter part is largeley supposition. Nobody knows which banks consider number of applications (hard searches), if any, and if they do whether they consider it to be a positive/negative thing over/below which thresholds - except the banks themselves, who aren't going to tell anyone.

Each lender is able to choose their own criteria.

I used to work in insurance qotation metrics, one of the things I learned was that the metric itself is not an indicator of good or bad - that's for insurers to decide. Some might view 9 points on a driving license as a 'don't touch with a bargepole' while others had evidence to show that people on 9 points tended to drive more carefully as a result.

The same applies with details on a credit record.

anthonybax

Your friend's existing relationship with HSBC might not have a direct impact on opening an account with Lloyds, but some banks might take into consideration an applicant's banking history, especially if they have a history of responsible banking.

eskbanker

buel10 said:

Best mate missed a few payments on credit cards before Christmas and tried to open a bank a/c with Lloyds last week but thinks he seen the message that he was refused due to his credit score? (he currently has two bank a/cs with HSBC)
I thought things have to be pretty damn bad before one is refused a bank account, as in CCJs, etc?

'Missing a few payments' undoubtedly has a negative effect on credit files, which is perhaps more serious than the casual tone might imply, i.e. failing to repay creditors on time is 'pretty damn bad', but has he checked the information recorded by the credit rating agencies to validate that it's all accurate?

https://www.moneysavingexpert.com/loans/check-free-credit-report/

TheMaverick000000

History shows that you could have the best credit record in history, but if your thinking does not agree with theirs, you have no chance of a bank account!