Buying Stocks Online, Do All Trading Sites Check Your Credit Report?!!?
Saturday, July 11th, 2009 at
10:59 am
I tried signing up for an account on scottrade and it said it had to check my credit report first! WTF! I didn’t end up finishing the sign up cause I did not want them to pull my credit. Why were they trying to do this and does this happen with all online stock trading sites? Can you recommend a site that does NOT do a credit check?
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i’m with scottrade and I can’t recall them doing that either but I looked and sure enough they do (though I signed up at one of their offices) I haven’t seen it anywhere else but all of them asks for your ssn so they may do a check without you knowing it.
I’m not sure exactly why either, but I’m willing to bet it’s for approval to trade on margin. Margin calls are basically loans, and they aren’t going to loan money to somebody with bad credit.
I have a Scottrade account. They say this is only used to verify your identity, I would assume that if you do not apply for marginthey would not turn you down if you can fund the account. They may restrict your trading if you have very poor credit but all brokers should since they have minimum sutibility requirements.
I have accounts with etrade and tradeking and I can’t recall either one saying that they checked my credit report. However I think brokerages are required to make sure that you are who you say you are. I wouldn’t worry about it too much–the absolute worst thing they could do would be to turn you down.
They do a credit inquiry. They all use third party verification companies to verify your identity.