You probably know what a checking account is but you might be wondering what is a second chance checking account? The name of the account should give you a clue. A second chance checking account is an account that allow those with financial hardships or bad credit to start over. These account can be found in banks in every state. Don’t feel bad if the economy has negatively effected your credit for you are not only. If you are someone that normally had good credit in the past, you can start here and work your way back up the ladder.
The first thing that you should do before trying to obtain a second chance checking account is to find out if you are in the Chexsystem database? The Chexsystem database is a database where bad bank credit against you has been reported. Not all banks check this information when opening a new account, but finding out which ones don’t can be next to impossible. You can order a Chexsystem report here. This report works a little different than a credit check. Credit check will list positive and negative information, but a Chexsystem report will only list the negatives. Items listed can include overdrafts, non-sufficient funds, or account closed with overdrafts. Even if you clear up this overdraft, it will be listed on your Chexsystem report for a period of five years, so take that into consideration when checking this report. You are allowed one free report a year.
How can you find a bank that offers a second chance checking account? Visit bank websites and see if they offer this service. You can also search at advertised sites online for a second chance checking account. These banks will often charge a monthly fee that averages around $10.00 per month, and if you have direct deposit added you can usually get many fees lifted. You can also find institutions that will offer checks as well as prepaid debit cards. That may sound bad, but actually with any brick and mortar bank that is what most people have available. Search for reputable institutions that offer FDIC secured second chance checking accounts. You should also find a bank that handles unauthorized charges to your account. Some sites deal with only MasterCard, but many offer Visa’s also. Getting back on your feet doesn’t have to be impossible. Arming yourself with the right information will allow you not to get taken advantage of by scam artist.
After you have returned to the work force maintain your second chance checking account carefully. Find a banking institution that offers financial counseling, and as your credit improves you will be in a better position to negotiate checking account fees. If you are receiving regular checks and making regular direct deposits, then look for a second chance banking account that offers more options such as lending services. Usually their monthly fees are only a few dollars more a month than those with just checking options. While you are getting back on your feet make concerted efforts to repair your credit and with time you will find yourself out of this system.
Once you have repaired your Chexsystem report which will take time, you can get back into traditional banking. When you do get there work diligently to build up on emergency fund. If you don’t want to wait for your banking report to be clear of information, or for the five years to pass in order for information to be completely removed, then when you do seek traditional checking account bring something viable to the negotiation table. Have funds available to open up an IRA, or get a certificate of deposit. Show the bank that you are ready to do business in a serious and responsible manner. This will increase your ability to secure an account. Good luck on your quest.