How to Get Around ChexSystems
Access to banking services offers consumers several financial benefits -- but an estimated 20 percent of households are unbanked, according to Bank On. Many unbanked households have negative ChexSystems records, which limits access to traditional banking services. Unbanked consumers spend additional fees on "fringe" financial services, such as pawn shops, check cashing stores or payday loan services, to meet their basic financial needs. The financial industry recognized the need for increased account access for the unbanked and provides a few alternatives for individuals with a ChexSystems record.
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Things You'll Need
- Social security number
- Drivers' license
- All account holders' names
- Opening deposits
Instructions
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Contact ChexSystems to request your current report. Review your report for inaccuracies and dispute any mistakes. Take note of the date and type of the last negative entry on your report. Many banks work with people as long as a specified amount of time has passed since the last negative entry. Negative entries must also fall within a specific category, such as nonsufficient funds fees, for most banks to consider you. Major entries, like fraud, will not get pass a bank's screening process.
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Contact your preferred bank and ask about ChexSystems reporting. Ask the representative the likelihood of the bank honoring your request based on the last negative entry and ask what type of negative entries they consider, if any. If the bank can work with you, submit your application.
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Contact a Bank On initiative in your area if your preferred bank will not approve you (see Resources). Banks that participate in the initiative open accounts for individuals with negative ChexSystems records. For example, Wachovia, Sun Trust and BB&T banks participate in the initiative.
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Open a prepaid account. Several companies, such as Western Union, Netspend or the AchieveCard, offer prepaid debit card accounts. Many prepaid accounts function like checking accounts or offer both checking and savings options.
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Tips & Warnings
If you are granted a second chance, make sure you keep your account positive and make regular deposits to the account. Times have changed in the banking industry and banks and credit unions are competing for your business. They do not want to turn you down, but they do not want to entrust a low-margin product to a high-risk consumer.
A small number of banks, such as Wachovia, have granted accounts only to go back and close them after Loss Prevention takes a look at the ChexSystems record.
