Reasons, You Should Opt to Open an Account with Second Chance Banks
Chexsystems is a service that provides banks and other financial institutions with consumer credit and account management reports. Banks will rely on information kept by the ChexSystems when you apply to open an account with them. Therefore, a bank may refuse your account opening request if you have negative ratings. For instance, if you were unable to maintain the bank’s account minimum balance. You should opt for a no-ChexSystems bank if you have the above issues. Below is why you should consider choosing banks that don’t use ChexSystems.
Chexsystems usually report only on your negative rating and ignore the positive aspects. Your previous banking activities will not hinder you from opening an account with second chance banks. You should strive to avoid banks denying you services due to your past. The best approach is to find banks that don’t use ChexSystems. Hence, you will have a new account within a short period if you choose second chance banks.
Banks that don’t use ChexSystems offer you the chance to avoid have a negative consumer credit report for an extended period. Usually the ChexSystems will keep your history for five years, and it is not automatic they will remove you after the period. It is understandable that you may have problems paying your account fees for a short duration. After the first year you streamline your financial activities and ensure that the account allows the minimum balance. The problem is that the negative report of the first year will be maintained for five years or even more. Such a record will make it hard for you to open a new account. Therefore, you should opt for second chance banks.
Having an account with banks that don’t use ChexSystems will prevent your banking records being shared with other parties. It is legal for ChexSystems to grant access to your banking history to other banks and financial institutions. Therefore, you risk your data being used to deny you various services. Banks that don’t use ChexSystems offer the chance to prevent this from happening. You record will be kept confidential.
Second chance banks offer you the opportunity redeem yourself. Maybe you were prompted by the situation to open a bank account thus you did not seek adequate information. Therefore, you accepted the terms and submitted the necessary documents. Later you realize that the banks have high fees that you struggle to pay making you have a negative banking history. Second chance banks offer you the opportunity to forget the past and have a new start.
For parents, you should select a no-ChexSystems bank for your son or daughter first account.