by: Michael Saunders

Credit is more than just a plastic card you use to buy things - it is your financial trustworthiness. Good credit means that your history of payments, employment and salary make you a good candidate for a loan, and creditors - those who lend money or services - will be more willing to work with you. Having good credit usually translates into lower payments and more ease in borrowing money. Bad credit, however, can be a big problem. It usually results from making payments late or borrowing too much money, and it means that you might have trouble getting a car loan, a credit card, a place to live and, sometimes, a job.

Creditors often look for bank accounts as a sign of stability. A bank account also gives an indication of how you will pay your bills. If you fill out a credit application and cannot provide a checking account number, you probably won't be given credit.

A savings or money market account, will also improve your standing with creditors. Even if you never deposit additional money into the account, creditors assume that people who have savings or money market accounts use them. Having an account reassures creditors of two things: You are making an effort to build up savings, and, if you don't pay your bill and the creditor must sue you to collect, it has a source to collect its judgment.

Just because you've had poor credit history, you shouldn't be denied a bank account. Shop around and compare fees, such as check writing fees, ATM fees, monthly service charges, the minimum balance to waive the monthly charge, interest rates on savings, and the like.

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Did you know?

If you need to work on your credit report, the FTC warns that no one can legally remove accurate and timely negative information from a credit report. The law allows you to ask for an investigation of information in your file that you dispute as inaccurate or incomplete.

There is no charge for this. Everything a credit repair clinic can do for you legally, you can do for yourself at little or no cost. According to the Fair Credit Reporting Act (FCRA).

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Your Credit Rating - Why it Pays to Keep an Open Checking Account
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