A checking account is a financial tool offered by most banks that allows you to quickly and easily deposit and withdraw funds from a secure location. While a checking account isn’t required and there are still millions of people without one, having a checking account can give you access to a wider variety of financial services and products.
Before issuing loans, most lenders need to be able to verify that you have a regular source of income and will use the checking account information provided on your application to ensure that you will be able to make the loan payments. In addition, lenders also need an account to deposit the loan amount. If you don’t already have a checking account, follow the steps below to discover which type of checking account is right for you and learn how to quickly and easily open a checking account today.
CHOOSING THE RIGHT CHECKING ACCOUNT
Before applying for an account at any institution you should carefully consider the following :
MINIMUM BALANCE REQUIREMENT
Pay attention to the minimum balance requirements for the account, and be sure that you will be able to maintain it. Never choose a specific checking account if you cannot maintain the minimum balance. If you’re unable to maintain the minimum balance, you’ll end up owing the bank a fee every month. .
TRANSACTIONS LIMIT
Certain banks limit the number of debit, checks or bill pay transactions that can be made each month. Be aware of these limits and be sure that they are aligned to your spending habits. If the numbers seems too restrictive, consider opening an account somewhere else.
MONTHLY FEES
Always consider the monthly service fee and overdraft fees charged by the bank for each account. Credit unions often offer lower fees. Also keep in mind that many banks have monthly service fees if you have automatic deposit or meet a minimum number of monthly transactions. However, fee-free checking accounts do exist.
GATHERING THE REQUIRED DOCUMENTS
In order to complete an application, you’ll need the following documents :
1. DOCUMENTS FOR IDENTIFICATION:
Social Security card Driver’s license State ID Passport Birth certificate If you wish to apply online, you’ll need to provide your SSN, DOB and a government-issued ID like a driver’s license or passport. If you are not a U.S. citizen, you may be able to open an account using an identification issued from your home country. If you’re applying for a joint account, both account holders will need to provide identification documents.
2. DOCUMENTS FOR ADDRESS PROOF: THE FOLLOWING DOCUMENTS CAN BE USED FOR THE ADDRESS PROOF:
Rent Lease with your name and address Ownership paperwork with your name and address (vehicle registration for example) Utility bill which has your name and address
3. OPENING DEPOSIT:
In order to open a checking account you would be required to deposit a minimum amount in your account. A minimum opening deposit for a basic checking account is between $50 and $150, it may be higher for certain interest-bearing accounts.
STARTING THE APPLICATION PROCESS
You need to follow the following procedure in order to process your account opening application. Visit the bank’s website or nearby branch to submit the application form and the required documents. The Bank will then review your documents, they might run a credit check to analyse your past banking history in order to determine your creditworthiness. If approved, you will receive your documents which will contain all the important information about your account like Account number, routing number, etc.
MAKE AN OPENING DEPOSIT:
If you open your account online, you can pay for the minimum deposit with a credit card, debit card or any other electronic transfer. If you open your account by visiting a nearby branch then you can make a cash deposit as well. Depending on how you make this payment, there may be a hold of a few days before your funds are available for writing checks, making withdrawals or making debit card purchases.
COLLECTING YOUR ACCOUNT KIT:
Once your application has been submitted, your deposit is done and your account has been set up by the bank or the credit union, you will receive a set of personalized checks, deposit slips and, in most case, either a debit card or an ATM card in your mail. You might need to activate your debit/ATM card and set up online account access as well.
Resources
1. https://money.howstuffworks.com/personal-finance/for-new-adults/how-to-get-loan-without-bank-account.htm
2. https://www.fdic.gov/householdsurvey/
