Does Having Multiple Bank Accounts Affect Your Credit Score?
Written by
Michael Keenan
Edited by
Cooper Bernier
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In some cases, applying for multiple checking accounts or multiple savings accounts could ding your credit if the bank pulls your credit score. Once the bank accounts are open, however, you can have as many bank accounts at that bank as you want without damaging your credit score because FICO and VantageScore do not consider your total assets.
Learn when and how much opening more than one account can affect your credit score. Don’t let having multiple accounts keep you from getting into the “800 club.”
Does Opening a Savings Account Affect Credit?
When you apply to open checking or savings accounts, your bank might pull your credit bureau report. Some banks conduct a soft inquiry, which doesn’t affect your credit score — but if your bank does a hard inquiry, your credit score could drop. An inquiry might drop your score about five points or it might not lower your score at all — depending on the other information on your credit report — according to FICO.
Related: Why Banks Run a Credit Check When You Open a Checking Account
Banks Use Third-Party Bank Account Databases
Banks use separate databases like ChexSystems and Early Warning Services to screen applicants for new accounts. These national consumer-reporting agencies keep records of people who have mismanaged savings or checking accounts by doing things like not paying fees or bouncing checks.
Find Out: What Is the Bank Early Warning Services System?
Financial institutions share information about customers who have mishandled their accounts and if the institution closed the accounts. The agencies collect this information and give financial institutions risk scores to use for potential customers.
If a bank receives information that you’ve overdrafted accounts in the past and haven’t repaid the money or the fee, it will be less likely to approve you for a new checking account. So, does closing a checking account affect credit? Not usually, but if you haven’t repaid any overdrafts, you might have a hard time getting approved for an account in the future.
Related: Choose the Right Bank Account for You
What Affects Your Credit Score?
FICO uses your payment history, amounts you owe, length and mix of your credit history and new credit applications to calculate your score. VantageScore uses similar factors: your payment history, age and type of credit, percentage of credit used, total balances and debt, recent credit behavior, and inquiries and available credit.
Read: FICO Score vs. Credit Score — What the Difference Means for You
You might, however, have three different scores for each model. Each of the three major credit bureaus — Experian, Equifax and TransUnion — creates a credit report for you. Although the reports are typically similar, small differences can result in different credit scores, depending on which bureau’s information is used. You can access your free annual credit reports as guaranteed by federal law through AnnualCreditReport.com, the official online resource verified by the Consumer Financial Protection Bureau.
Up Next: How to Dispute Credit Report Errors
