Not all felons are good at handling money. In fact, this could have been the exact reason as to why some felons went to jail. They do not really know how to manage their money very well in their previous lives. This then backfired and resulted in having huge sums of debts from various sources like banks, credit cards, and even loans.
In addition to that, others even had multiple credit cards and have not bothered to keep their credit limit in check so they simply kept on swiping without caring how much their bill was expanding. Obviously, it has reached a point wherein they can no longer pay the said bill. This could have been the reason as to why they have been forced to commit crimes and felony.
How to open bank accounts for ex-prisoners
After serving their time, they probably already had a change of heart and want to live a long and honest one. After all, everybody does deserve second chances. On the other hand, there are also those who do not really trust banks to keep their finances in check. As such, they do not want to open their own bank accounts. However, is that really a smart choice?
We will be talking about that in this article.
Why do I need to get a bank account?
There might be some kind of thought inside your head that goes like “Why do I need to put my money in a bank?”, “I have seen a lot of Hollywood movies and banks cannot be trusted.”, or “Those banks are just after my money.” All of these thoughts are quite valid. Well, some of them are. Opening a bank account is essential to help everybody keep their finances safe. That goes without saying.
It is a lot safer to store your cash inside the bank instead of your home. In fact, it is straight-up better to deposit all of your cash. This way, you do not have any money inside your pockets or wallet and will avoid being tempted to spend it. Automatic savings.
Banks can also help with the payment of bills. Most banks nowadays accept payments to multiple other necessities. In addition to that, some even offer to automatically deduct these bills on your credit every time the deadline comes up. Talk about convenience. In addition to convenience, allowing your bank to automatically pay your bills will also increase your credit rating since you are never late on a payment. As a felon, you should know how important it is to have a good credit rating. It will definitely come in handy in the future.
Most felons who had just got released do not have any cash at their disposal. They simply had to go back to phase 1 and restart on everything. Opening a bank account allows you to have one option–loaning. Hold up, listen to us first before you double-take. Loans can be useful as long as you do not abuse it. In addition to that, you have to make sure that you will not be overlooking said loans. If you keep all of these in mind, then loads should be another useful tool in your arsenal.
Another important note is that banks often check an individual’s credit rating when they apply for loans. This is another reason to let the bank handle your bills. Just keep a keen eye on your credit balance and incoming bills.
Let us talk about banks
First and foremost, we would like to specify that opening an account is simple. You only have to fill up some forms, provide certain proof, and have some money to deposit for starters. Before you do that, however, we would first like to discuss the different types of accounts you can open.
This is probably the most common account type out there. Its purpose is simply to hold your money in it. If you have this type of account, there are two ways you can access your money. First is through writing a check, like those that you see in movies and other dramas. The other one is by using a debit card that is linked to your checking account. Of course, it goes without saying that your credit limit is the amount of money inside your account.
You can opt to use this account since it can be easily utilized for paying bills and for your daily expenditures. In addition to that, bills are often payable online using the funds inside this account. That leaves you not worrying about any sort of problem.
Using this kind of account is primarily used for keeping your money in for long-term use. The good thing about this kind of account is that it often earns interest depending on the amount of money you have deposited in it. The larger the sum, the better the interest rates are. All you have to do is dump your money and watch it grow. The interest should reflect on your account per monthly or quarterly basis. This depends on your bank’s policy.
What do I have to do to open an account?
As we have already stated earlier, opening an account is actually very simple. However, you do have to prepare a couple of things and information. Some information that you have to prepare are these:
- Date of birth
- Social Security Number
- Primary Identification – this could be a driver’s license or any other state-issued ID
- Secondary identification – this could be your credit card, utility bill, or even your rental agreement with your current home
The primary purpose of getting this information is basically for the bank to identify your financial history before they give you the go signal of opening an account with them. They also conduct some sort of bank history report which can show them whether you already had an account before but was somehow “closed for a cause” or if this is your first time opening an account. The reason behind this is to know if you have a record of mishandling your funds. If they do find out that you do, there is a large possibility of the bank refusing to let you open an account.
Do not fret, though. There could be various reasons as to why an account has been closed for a cause:
- Not paying insufficient fund fees even after an overdraft
- A history of fraudulent activities
- Writing a couple of bad checks in the past
This is also important since financial companies look at a bank history date using a service called an account verification service.
Should felons be rejoicing?
Some other details on felons may or may not pose any kind of problem. Let us say that someone has been sentenced guilty for committing a felony, it mostly depends on the bank whether or not they will accept the felon. The degree of felony is also a huge factor. If, however, let us say that someone has committed financial crimes like money laundering, then said person is most likely gonna be rejected from opening his own bank account.
It is of utmost importance, to tell the truth during the application process. If you did not disclose any history of committed crime during the application process and you got found out, you can be sued for fraud and go back to the prison you have just been freed from. It would be best to keep in mind that the falsification of the bank account application is illegal and warrants jail time.
Of course, it is not all about dread. In order for felons to successfully open an account, they must be open about their history. After all, they are already being seen in a bad light, especially about being liars. Openly disclosing your own history will increase the chances of being given a second chance to start anew. On the other hand, if you can get your records expunged, then that would be for the best. Expunging a criminal record will allow you to tell the bank of being devoid of any crime without being dishonest.
In the end, what should I do?
An ex-prisoner would find it useful to do his best and open a bank account. If it is within a felon’s capabilities, getting the records expunged and acquiring some additional education can highly increase a felon’s chances of successfully opening a bank account. Consequently, that also implies a stronger and better financial footing in this world.
Of course, a felon’s family, friends, and even previous employers can make a huge difference in both his life and how society sees them. Felons are always humans first before being felons. Their crimes should never define their entire being. As we have said before, everybody deserves a second chance in life. After all, we are not defined by our mistakes, rather by how we recover and compensate for doing those mistakes. Everybody can and should live an honest life. It does not matter how hard or difficult the challenges may seem.
We would love to know whether or not you enjoyed reading this article. Did you find it nice? Informative? Frustrating? Feel free to tell us below. In addition to that, you may also know some felons who have tried to open a bank account, or maybe you, yourself, as a felon. Perhaps, you can share your experience with us so everybody can learn from the first-hand experience.