Do Checking Accounts and Savings Accounts Impact Your Credit Score?

Monday, May 24, 2021

In short, checking and savings accounts (e.g., deposit accounts) do not impact your credit score. But, that doesn’t mean you should neglect your deposit accounts. Maintaining a healthy balance while using the cash in your checking account wisely, and diligently putting money away in your savings account helps to build good money habits that could benefit your credit score in the long run. Frequently mismanaging your deposit accounts could prevent you from opening deposit accounts in the future.

credit score

How deposit accounts impact your credit score

Can your checking accounts and savings accounts have an indirect impact on your credit score?

The answer is: that depends.

Opening or closing deposit accounts, writing checks from your checking account and depositing money into your savings account usually won’t change your credit score. If you don’t have a credit history or score, your bank accounts won’t build a credit history.

There may be times, however, where your deposit accounts are an important part of getting a loan or line of credit. Depending on your lender and what type of credit you’re looking to get, you may be asked to provide documents on your current account balances. Some lenders may use this information — along with your credit score — to make a decision on your loan application.

While checking accounts and savings accounts aren’t usually reported to a credit bureau, there are still a lot of benefits to opening and maintaining a bank account. Bank accounts from an FDIC-insured bank like ASB provide a safe place for you to keep your money. You can use bank accounts to safely and securely deposit paychecks, pay your bills and save money for the future.

How deposit accounts hurt your credit score

Can your checking accounts and savings accounts indirectly hurt your credit score?

The answer is: that depends.

Although deposit accounts are unlikely to hurt your credit score, if mismanaged, they could prevent you from opening other deposit accounts. The following are examples of activities that could potentially hurt your ability to open a deposit account:

  • Excessively overdrawing your deposit account and not depositing enough money in a timely manner to cover negative balances and fees.

  • Writing checks when there’s not enough money in your account.

  • Your account is closed for cause.

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Credit Inquiries: Soft Pulls vs. Hard Pulls

Many lenders will perform a credit check to determine your creditworthiness. There are two types of credit pulls — a soft pull and hard pull.

  • Soft Pulls: A soft pull, or inquiry, generally does not affect your credit score. This happens when your bank takes a quick look at your credit history to check your credit, similar to a creditor pre-approving you for credit.

  • Hard Pulls: A hard pull, or hard credit inquiry, is an official request by a lender to see your credit report and credit history after you give them permission. This is often done when you request to borrow money, open a credit card or request a line of credit.

Learn more about credit scores and how it impacts your borrowing power

While it’s unlikely your deposit accounts impact your credit score, they could play a role in helping you get approved for accounts like a credit card or personal loan. You can take steps to build or improve your credit score by getting a better understanding of how credit scores work and how to improve yours.

Want to learn more about your accounts and your credit? Contact one of our knowledgeable bankers to today by making an appointment to meet over the phone or at a branch.

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