If a bank or credit union denied your application for a checking account, it’s time to consider a No-ChexSystems Bank or a bank that offers Second Chance Checking Accounts.
There’s a real impact to not having a traditional bank account. People without the option of a checking account not only spend more time transacting financial matters, but also spend more money in fees to conduct basic day-to-day expenses.
According to a NerdWallet study, the annual cost of cash-only households is $198 for check cashing and money orders. Prepaid card users with direct deposit pay an annual average of $196 in fees, while prepaid card users without direct deposit pay $497 in fees.
Time spent waiting in lines at check cashing stores, loading prepaid cards and purchasing money orders cannot be restored. Second chance checking accounts offer many conveniences like online and mobile banking, automatic bill payment and free money-transfer services free of charge.
Prepaid cards may come with these services, but they usually aren’t free.
There are full-service online banks that don’t use ChexSystems as improved technology tools make people more comfortable swapping face-to-face services for Online, Mobile and ATM banking, like the BBVA ClearConnect Checking Account available in 48 states. The ClearConnect checking account is a free checking account with no strings attached.
Why You Need a No-ChexSystems Bank Account
It’s important to have a checking account as banks and credit unions provide safe places to keep your money. Plus, once you become established in a no-ChexSystems checking account, it’s likely to grow into more advanced accounts like savings accounts, CDs, credit products, mortgage and car loans.
People with traditional bank accounts tend to save more, keep more of their earnings and are better prepared for financial emergencies. Without access to savings accounts and CDs, it can be difficult to build and maintain an emergency fund
But there’s another reason No-ChexSystems banks are so important — bank sweeps. If you have a ChexSystems record it’s best to have one or more Non-ChexSystems checking accounts. Some banks periodically run “sweeps” even if you are a customer in good standing. You can find more about bank sweeps and how to protect your money below.
Benefits of a Second Chance Checking Accounts
Banks that run a credit report can deny you if your credit is imperfect. Second Chance Banks allow people an opportunity re-establish a banking relationship regardless of bad credit. For instance, second chance banks may open an online checking account for bad credit giving you an opportunity to transition to a traditional checking account if, after 12 months, the account is in good standing.
No ChexSystems Banks and Second Chance Banks of 2018
Available to residents online in ALL STATES (except Alaska & Hawaii). The checking account features free checking, mobile deposits, online banking, free bill pay, check writing and a Visa debit card. BBVA Compass is a No-ChexSystems Bank with a Second Chance Checking Account option. For customers that enjoy mobile access, BBVA Compass mobile app was deemed a leader by Javelin Strategy & Research for its ease of use.
More great features of the ClearConnect Checking Account.
- Apply with only $25 opening deposit
- No monthly Service Charge
- Complimentary Online Banking and Mobile Banking, Bill Pay and Online Statements
- No ATM withdrawal fees at any BBVA Compass or Allpoint® ATM
- Compass Bank, Member FDIC
There are great features with the ClearChoice Money Market Account like mobile check deposits, direct deposit and free bill payment. The account requires a deposit of $25. A money market account is like your basic savings account except the annual percentage rate is typically higher. Currently BBVA is offering an APY of 1.25%. You earn tiered interest rates to grow your money faster. That means the higher your balances, the greater your interest-earning possibilities. Open Now.
Axiom Bank offers a fresh start with their Opportunity Checking Account in Tampa, Jacksonville, Orlando & Central Florida. You’ll get access to online and mobile banking tools to help manage your account. Account features: Unlimited Check Writing; No minimum balance requirement; Debit card opportunity, subject to approval; $10 monthly service fee; and $25 minimum opening deposit.
Fort Sill National Bank (FSNB) is open to anyone — you do not have to be in the military. FSNB does not use ChexSystems. If you are interested in direct deposit, this may be a good account for you because FSNB may not be located in your state. In order to open an account from any location call their new accounts department at (800) 749-4583 and an application will be mailed to you.
This bank is only located in New Mexico, Texas, and Arizona. They do not run Chexsystems, Telecheck, or EWS. Several checking account options are available but there is a $12 monthly maintenance fee if certain conditions are not met such as maintaining a minimum daily balance. All checking account options only require $1.00 to open.
Memory Builder Checking Account is a second chance checking account that gives you the opportunity to rebuild your banking privileges, available in all states. Minimum opening deposit is $50. Monthly fee is $8.95 that can be reduced to $6.95 per month if you get your statements online. Customers have access to funds with over 85,000 surcharge-free ATMS.
Navy Federal does not use ChexSystems or EWS to open a bank account but there are strict requirements to become a member. Membership is open if you are affiliated with the Armed Forces, DoD, Coast Guard or National Guard. This includes Army, Marine Corps, Navy, Air Force, and Coast Guard regular Active Duty and reservists, and Army and Air National Guard personnel. Active duty and Retired military are eligible but unfortunately Veterans are not. DoD civilian employees and contractors assigned to U.S. Government Installations may be eligible.
U2 EChecking available in all states. There are branches in CA, FL and MA. Minimum opening deposit is $100. Free Online and Mobile Banking. Monthly maintenance fee for internet accounts waived for waived for the first month of service only. Deposit checks through mobile app. Obtain cash at 25,000 ATMs free of charge.
Peoples Cash Solutions offers a Second Chance Checking Account for consumers who have been reported to ChexSystems or TeleCheck. There must be no fraud activity reported in ChexSystems. Bad credit and even bankruptcy are okay.
PNC offers second-chance checking to customers with a ChexSystems report. You’ll have to open an account in person after taking the Foundations of Money Management Course online. There is a minimum $25 opening deposit, Visa debit card, unlimited check writing and a $7 monthly service fee. Eligibility to graduate to a regular account after meeting requirements. This account is not advertised, but available in AL, DC, DE, FL, GA, IL, IN, KY, MD, MI, MO, NC, NJ, NY, OH, PA, SC, VA, WI, WV.
This bank is only located in Mississippi, Alabama, Tennessee, and Georgia. You can have a Chexsystems, Telecheck or EWS record but there must not be any money owed to Renasant Bank. Checking accounts offer free online bill pay along with mobile banking. You can apply online.
Suntrust Bank offers several types of checking accounts, all of which include online banking, mobile banking, overdraft services, direct deposit, online bill pay and a SunTrust MasterCard® Check Card. While Suntrust maintains they do not use ChexSystems, some consumers have reported otherwise. It may be best to apply over the telephone or through their online chat service; and, complete the process in full through the mail.
This bank is not available in all states. TCFBank has 436 branches in Minnesota, Illinois, Michigan, Colorado, Wisconsin, Indiana, Arizona and South Dakota. This bank offers several checking accounts to choose from and a business checking account. They will open an account for consumers in Chexsystems but you must not owe any money to TCFBank. Consumers with an EWS record may be denied.
This bank is not available in all states. Branch locations are located in Maryland, Ohio, Pennsylvania, Virginia, West Virginia, and Washington D.C. They do not run Chexsystems. Several checking account options are available but there is a $50 minimum deposit required for all checking account options.
Try the in-store branches and take proper identification along with a utility bill showing your address. Consumers using in-store branches have experienced success in opening checking accounts while in Chexsystems.
USAA primarily serves military families, including retired service members, spouses, and children. Members of the National Guard are also eligible. You’ll need a $25 deposit to start, but you’re not required to hold a minimum balance. Additionally, there is no monthly service fee and you can take advantage of free ATMs, mobile check deposits, and overdraft protection. Note that USAA does use EWS, though it doesn’t use ChexSystems.
The Rewards Card Checking requires direct deposit of payroll or government benefit. There is a monthly maintenance fee of $9.95. They do run ChexSystems but have less stringent requirements. Fraud should not be indicated. Customers enjoy no overdraft fees, a checkbook, Mastercard® debit card and free nationwide ATM access through the Allpoint® 55,000 ATMs Network.
This is a traditional checking account with a visa debit card and checks; however, it comes with some restrictions. This account will definitely help you stay within your budget. Deposits cannot be made through the ATM and you may not be able to get cash back immediately upon depositing a check. Once you remain in good standing for some time, Wells Fargo may offer you an upgrade to a regular checking account, with less restrictions.
This bank is not available in all states; however, they do have an account called “Second Chance Checking. It comes with unlimited check writing and a debit mastercard. You must go inside a branch in order to open this second chance checking account.
ChexSystems is a Consumer Reporting Agency like the 3 major Credit Bureaus
People denied from opening a checking account may not be aware a bank has reported them to ChexSystems until they attempt to open a new account. If you’ve had a check bounce, multiple overdrafts or closed an account before paying bank fees, you may be listed in ChexSystems.
As a consumer reporting agency, ChexSystems maintains negative checking account history on consumers for 5 years; unless you are successful in disputing ChexSystems records. There’s no refuting banks must have a screening process for new customers, but the problem with ChexSystems is that it only reports negative information; unlike a credit report.
Credit reports can contain negative as well as positive information while a ChexSystems report only contains negative information. A one-time mistake could land you in ChexSystems with no positive reporting information to offset it. That one-time mishap can stay on your ChexSystems record for five years and prevent you from opening a checking account.
Because 80 percent of banks and credit unions screen new customers using ChexSystems, it’s a good practice to order your ChexSystems report, free of charge, once a year. Get in the habit of monitoring your ChexSystems reports.
Fortunately, banking options exist for online checking accounts for bad credit, 2nd chance checking accounts and banks that don’t use ChexSystems to qualify new customers.
Banks will sometimes conduct ChexSystems Sweeps on existing customers and account holders that have a prior ChexSystems record and close accounts without warning, even if your account is in good standing. It’s dangerous to have all of your money in one place. With account freezes, you can lose access to your money for up to 30 days.
For that reason alone it’s important to maintain more than one banking relationship; 30 days is a long time to have your money tied up.
Never have all your money in one bank. With current negatives in ChexSystems, keep a non-ChexSystems account as a backup.
Banks that use ChexSystems may conduct a sweep and freeze any account holders that have a prior ChexSystems record. It’s dangerous to have all of your money in one place. If an account freeze happens to you, always request management or someone in the security department with decision making power to release your money earlier. There’s really no reason to hold a customer’s funds for 30 days.
If you have direct deposit you may want to split it. That way if your primary account is frozen or closed you still have access to a portion of your paycheck.
Best practices for people with a ChexSystems record
- Have more than one Non-ChexSystems checking account — Don’t put all your eggs in one basket.
- If you have direct deposit, split it between your Non-ChexSystems checking accounts. That way you’ll have access to some funds if one of the accounts is frozen.
- Stay away from supplemental services like Billpay until your ChexSystems record is clear.
- Immediately report any fraudulent activity you may discover on your accounts.
- If you close your account, continue to monitor it for several months to ensure there are no unpaid charges, fees or overdrafts.
How to fund your New Checking Account or Verify Small Deposits
If you are opening an account online but do not have a way to fund it instantly with another account or credit card, most online accounts can be funded with a prepaid card. Or, use PayPal® to add money to your bank account. It’s fairly simple and with PayPal® your account can be funded in 2-3 days.
Safe Check Ordering
Consumers who have been reported to ChexSystems, whether the item is paid or unpaid, should be careful when ordering checks. Ordering checks from well known companies such as Deluxe, Designer Checks, Checks Unlimited and Current Checks may not be safe. These companies share your personal information with ChexSystems. ChexSystems will then report your ChexSystems record to your current bank.
Order checks from companies that do not share your personal information with ChexSystems such as Costco Check Printing, Checkworks or Harland Clarke. Ordering checks from companies that share your information with Chexsystems may end up getting your current bank account closed, even if your checking account is in good standing.
Practice good checking account management
Once you open a checking account, you need to manage it in order to keep it. When you manage your account, you can avoid unnecessary fees, a ChexSystems or EWS record. Here are actions to take for good checking account management:
- Keep track of your balance and any outstanding payments.
- Open and review all bank statements and correspondence.
- Avoid spending more than you have in your account.
- Monitor your account online or on your phone before you withdraw cash at an ATM.
- Check your balance by phone or online before you write a big check or make a big payment.
- Sign up for transaction alerts and low-balance warnings via e-mail or text.
- Don’t assume that the money you deposited is available immediately.
- Find out when the money you deposit will be available for your use.
- If there is a “hold” on a deposit, make sure you know when it will be lifted
- Avoid making a payment using your checking unless you know for sure the money is in your account.
A Final Word
Non-ChexSystems banks offer the same features as banks using ChexSystems — you’ll have a variety of options to fit your banking needs regardless of your banking history. Since 2010 we have maintained an updated, comprehensive list of No-Chexsystems banks and 2nd chance checking accounts you can open online today.