Chexsystems is a consumer reporting agency (CRA) which produces reports about your checking account habits.
It is not a financial institution but is a publicly traded company owned by eFunds, Inc. Chexsystems maintains a vast nationwide database on all consumers who have bank accounts.
Consumers do not provide the information maintained in Chexsytems, banks, credit unions and other financial institutions provide the information. As with your credit files, it is just as important to know what information is contained in Chexsystems about your banking habits.
Information contained in Chexsystems reports
While Chexsystems maintains your chexsystems report they are not responsible for the decision made by banks to deny you a checking account. A bank manager can override Chexsystems at any time. What is responsible for the denial of a checking account is the information maintained in Chexsystems databases.
This information can be incorrect, inaccurate, erroneous or outdated and the slightest bit of negative information can result in a denial and have a damaging effect on the consumer. The following information may be contained in your Chexsystems report:
- Paid and unpaid insufficient fund items (“NSF”)
- Excessive “NSF” charges, even though you may have covered all of those charges with the bank
- Checking account habits that your bank may consider negative
- Bank Fraud
- Uncollected overdrafts, ATM transactions or automatic payments the bank paid
- Debit card, savings account or ATM abuse
- Opening an account with false information
You are entitled to your ChexSystems report
Chexsystems is a consumer reporting agency (CRA) and is subject to the Fair Credit Reporting Act (FCRA). Your report can be made available for a fee or under the Fair and Accurate Credit Transaction Act (FACTA) you can get a free copy of your ChexSystems report once every 12-months. For a free copy of your Chexsystems report visit: Chexsystems Consumer Assistance.
You may also get a free report if you have experienced one of the below:
- Denied a bank account due to information in your ChexSystems file.
- You must request this report within 60 day of your denial.
- If you are unemployed and intend to apply for unemployment in the next 60 days.
- If you are on public welfare assistance.
- If you have reason to believe your file contains inaccurate information due to fraud.
Contact Chexsystems at: ChexSystems, 7805 Hudson Road, Woodbury MN 55125-1403, (800)428-9623-tel and (602)659-2197-fax and www.consumerdebit.com
Paid Items in ChexSystems
If you have resolved the issue with the bank make sure your report reads “all amounts owed have been paid” or “paid status.” The bank which reported you should update your file with ChexSystems but unfortunately this does not always happen. If the resolved matter does not reflect a paid status, contact the bank immediately and request they file an update with ChexSystems.
Negative items
Negative information can remain in your file for up to five years. Negative information can be disputed and must be investigated by Chexsystems. Learn how to dispute negative items in your Chexsystem report. Since the dispute process may take some time to resolve, there are other options, such as a savings or prepaid account.
Get a Prepaid Card that functions as a checking account
UPside Prepaid Visa works like a checking account with a free direct deposit service and you can write personal checks online. In order to write a check all you have to do is log into your account and select the “Write a Check” button and fill out the payee name, address and amount.
The check will be debited from your prepaid account and sent automatically on your behalf. You even have the ability to stop payment on the check if the check has not been cashed by the payee. Sign-up to get the UPside Prepaid Visa now, there is no ChexSystems or credit checks.
Not having access to a checking account means you will have to pay extra to cash checks, you will have get money orders to pay bills, you will not have the ease of use of an ATM or debit card and, you will have the inconvenience of carrying cash all the time. A savings account can at least give you some functions as a checking account, like having a debit card.
ING DIRECT
The High Yield Savings with the Orange Savings Account℠ from ING DIRECT has no hidden fees or service charges and no minimum deposit. There is no ChexSystems with the Orange Savings Account; however, they verify your identity by making a small deposit in an existing checking account at another banking institution.
The Electric Orange℠ checking account from ING DIRECT is not only an above average checking account because it is an Interest Earning Account but for other reasons such as: (1) No ChexSystems; (2) No Overdraft fees; (3) No ATM Surcharge; (4) No Monthly Fee; and (5) Earn a $50 bonus when you open an account.
The only issues you may encounter in opening the checking account is that you must have an existing checking account in order to fund and link to the Electric Orange℠ checking account and they will pull your credit because they offer an optional overdraft line of credit which allows customers to write checks or make debit card transactions for more than you have in your account.
