Bank account woes won’t hurt credit

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Dear Dr. Don,
I have a bank account I have not been using for some time now. As I did not maintain a minimum balance of $1,500, the bank kept charging me a monthly fee until the $100 I had in the account was gone and then some — I was $35 in the hole.

Due to the negative amount, they closed the account and notified me shortly after that. How does it affect my credit score and will it be all right if I open the account again. Please let me know what I can do?
— Sridevi Savings

Dear Sridevi,
The closed bank account should have no impact whatsoever on your credit score. The bank did not extend you credit. There’s no payment history for them to report.

The bank can, however, report you on your consumer banking report. That report keeps track of your banking relationships. The most frequently used consumer report agency for banking relationships is ChexSystems. Just like a credit report, you are entitled to one free banking report each year.

Negative information stays on your banking consumer report for five years. It’s possible your bank did not report the closed account to ChexSystems. But if it did, it could impact the willingness of other banks to have you as a customer. Next time, close the account before letting the bank drain it dry with monthly fees.

To ask a question of Dr. Don, go to the “Ask the Experts” page, and select one of these topics: “Financing a home,” “Saving & Investing” or “Money.” Read more Dr. Don columns for additional personal finance advice.