subject: Checking Accounts For People With Bad Credit [print this page] Consider yourself lucky if you're not one of the people who have the misfortune of landing on Chexsystems' list. If you have no idea what I'm talking about, then it's a good thing and you might want to keep it that way. Financial institutions use this information to decide who they open new checking accounts for and who they don't. If you're on that list, they consider you as the type of customer they don't want, and you're pretty much locked out of the banking system.
Some people refer to it as having bad credit, but in reality, having a Chexsystems record sometimes doesn't have anything to do with having bad credit. If you keep giving out checks without the necessary amount to cover them in your account, your bank might decide to close the account and report the repeated abuses, even if you always end up paying the overdrafts. They interpret it as a sign that you can't manage your finances, and decide they no longer want you as a customer.
The thing with being listed on Chexsystems is that roughly 80% of the banks in the United States use that information to screen prospective checking account customers. It's a well-known fact that the financial industry is not one that likes to take risks. Nevertheless, with things having soured in the economy the way they have, a lot more people have encountered financial difficulties and have messed up on their accounts at one point or the other. That means that there are now a lot more people with a negative record than a few years ago. So banks have had to loosen things up a little bit.
The result is that you can still get a checking account while being on Chexsystems. There are banks out there that don't use the service. There are yet others that do use it, but don't base their decision solely on that information. It will depend on the bank's policy when it comes to that kind of situation, but smaller banks will tend to at least hear you out before they make the decision.
What you need to do to open a checking account even if you're on the Chexsystems list is to start calling banks and ask them about their policy regarding the matter. Ask to talk to a branch manager to at least see if they will hear you if you show up. This way, instead of being embarrassed when you try to open an account, you can show up and ask to talk to such and such. Also, make sure that you don't end up paying exorbitant fees to open and keep your account. Sure, a second chance checking account is more expensive to have than a regular one, but it doesn't have to cost you an arm and a leg.
Finally, keep in mind that most of the companies that give out those second chance checking accounts will review your situation within a six to twelve month time frame. If you keep your account in good standing within that period, you have a good chance of seeing your account upgraded to regular checking account status.
