Second Chance Checking
Second chance checking accounts are bank accounts for someone that has been reported to a bad checking account history database like ChexSystems. Financial institutions use ChexSystems to basically keep out the bad apples and minimize their risk with their deposit account holders.
Second chance checking accounts have extra restrictions on the account due to the added risk the bank is taking on opening an account for a customer with a bad history. For example some banks don’t let customers in these accounts have a check book. Most second chance checking account holders do get ATM cards, online bill pay, and direct deposit capabilities.
People who are placed in the ChexSystems database for up to 5 years and it’s basically impossible to be removed from this list. Sometimes individuals end up in the ChexSystems database that don’t belong there. This may be due to the fact that there’s no set standard for banks to place individuals in the database. Each bank has their own criteria for placing an individual in ChexSystems.
Second chance checking accounts vary from bank to bank. Some banks require a large opening deposit while others don’t allow large account balances. Some banks are more forgiving of past mistakes made on checking accounts and some are more strict with their guidelines. Some banks will offer accounts to just about anyone on the ChexSystems database as long as there was no outright fraud involved in their account history.
If you’re opening a second chance checking account be sure you understand the rules and parameters of the account. Some financial institutions will try to leverage their power over ChexSystems customers and take advantage of them. Be very careful when opening a second chance checking account.