| When lenders look at your credit score or credit | | | | against the law. When an honest account holder |
| history, one factor in their decision may be your | | | | bounces a check, illegal consequences may not occur, |
| banking history. The way you use your bank accounts | | | | but the bank will again charge an additional processing |
| can be an indicator to those offering credit, and there | | | | fee for bounced checks, and the check writer will |
| are some red flags that get you in a lot of financial | | | | inevitably have to pay a larger balance. |
| trouble. | | | | Yet another banking feature that can get you in |
| An overdraft occurs when an account holder draws | | | | trouble is an "insufficient balance" charge. A bank may |
| from a checking account with a dangerously low | | | | impose a monthly charge if there isn't a specific |
| balance. If the money isn't in the account to withdraw, | | | | balance in the account. These charges can also |
| banks will often charge an additional fee to process | | | | deplete your checking or savings account to |
| the transaction and bill the customer for the balance. | | | | dangerously low levels. Not all accounts carry |
| Overdrafting is an expensive way to do banking, and | | | | low-balance fees, so check the fine print when you're |
| those who don't have emergency savings can quickly | | | | opening an account to see what the requirements are. |
| be swamped by low-balance overdrafts. Overdraft | | | | So how do you know if these slip-ups or others |
| protection, offered by some banks, comes in handy | | | | related to a checking or savings account are affecting |
| for dealing with low-balance accounts. Customers can | | | | your credit? If it's been a while since you reviewed |
| also link accounts together, tying a checking account to | | | | your credit history, it can be tough to tell. Credit |
| a savings account, to provide additional overdraft | | | | monitoring gives you up-to-date information on your |
| protection. | | | | credit score, credit history, and how your banking |
| Bounced checks are more serious. Writing checks | | | | history may be affecting your credit. The three large |
| without sufficient funds is, in some cases, overtly illegal, | | | | credit report agencies, TransUnion, Experian, and |
| especially considering whose name is on the account. | | | | Equifax, all offer a free credit report annually. |
| The practice of "writing bad checks" is definitely | | | | |