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1:12 pm
March 16, 2009
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looking_for_best_rate
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I want to open a savings acct with CTFS but cannot afford another hard credit check on my credit report.
Any insight would be appreciated.
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2:19 pm
March 16, 2009
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Doug
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All "virtual" banks pull a copy of your credit bureau when you open an account. It's not that you're applying for credit so it doesn't affect your score in that way in terms of having additional credit available to you but it is still an enquiry on your credit bureau. Enquiries last for three years with a minimum of up to five enquiries on your credit bureau at any time. (If you had opened and closed a credit card, I believe that would stay on your file for seven years – same with an orderly payment of debts or a bankruptcy.)
As to how much it affects your score to have another enquiry, so many enquiries in a short period of time will negatively affect your score to varying degrees. Can you wait three to six months before opening the account?
Hope that helps,
Doug
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3:59 pm
March 16, 2009
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jeremywong
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According to Canadian Direct Financial, a soft credit report is run, so your credit rating isn’t affected. It’s reasonable to assume other banks have the same policy.
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1:15 am
March 17, 2009
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Jason
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Basic on my credit file from Equifax, CTFS does not do any check.
For other banks, it's as follows:
CTFS: none
Citizens: hard
HSBC: hard
ICICI: hard
PC: hard
Peoples Trust: soft
ING: none
Maybe that's not the whole story though. Perhaps some banks determine hard/soft/none based on the applicant?
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9:54 am
March 17, 2009
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SG
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Jason did you open your ING and CFTS accounts before June 23, 2008? Before June 23 most banks were performing credit checks but were not required by law to do so, I believe after this date…ALL Banks if application is by internet, phone or mail have to, the only way to avoid this is by going into a branch and opening in person…which you can't do with virtual banks.
As for the Hard or Soft hit…CTFS I can't comment on as I don't deal with them, but some of the other ones I see that I do deal with, my experiences have been the same.
Thanks
SG
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1:45 pm
March 17, 2009
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Jason
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SG said:
Jason did you open your ING and CFTS accounts before June 23, 2008? Before June 23 most banks were performing credit checks but were not required by law to do so, I believe after this date…ALL Banks if application is by internet, phone or mail have to, the only way to avoid this is by going into a branch and opening in person…which you can’t do with virtual banks.
I opened my accounts at CTFS, ING, ICICI, and PC before that date. The rest were done after.
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1:47 pm
March 17, 2009
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Doug
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SG, you are correct, I believe. All "virtual" banks without branches where face-to-face contact is not possible are required under the Proceeds of Crime and Terrorism Financing Acts to take you SIN, your driver's license, credit bureau and cleared personalized, pre-printed personal cheque together to form their basis for establishing identity. I didn't realize prior to June 23rd, 2008, "virtual" banks didn't have to do credit checks but definitely after that date they do.
You are quite right about visiting a branch and opening an account to avoid having your credit bureau "dinged". ING Bank of Canada has "cafes" in major cities like Vancouver, Calgary, Toronto, Montreal, those sorts of places, and HSBC Bank Canada has some 150 branches across the country where you can visit and open new accounts in-branch.
As for Canadian Tire Financial Services, unfortunately, being they have no branches (some Canadian Tire stores have Canadian Tire-branded ABMs but that's all), a credit check would be mandatory then.
Hope that helps,
Doug
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