In this post, we will learn about second chance bank accounts and ChexSystems technology.
Learning to properly manage a bank account needs a lot of trial and error and making a mistake is more common than ever. Opening a new bank account can be difficult if you have had trouble in the past with bounced checks, overdrafts, or bad credit. The second chance bank accounts are made for those people who have taken a wrong step or two in their way and need to take a fresh start. The following are some of the ideas on getting approved.
What is ChexSystems? How does it work?
1. A comparison of your options
The second chance bank accounts are offered by banks both small and big, but not all that is on offer is the same. It is necessary to know all the details when you are looking around for the right checking account. Look into the fees charged by the bank and the services that you are able to avail of. You need to check if you have the opportunity to change the second chance accounts into traditional accounts at a later point in time. The terms of account differ from one bank to another, and that is one of the prime reasons for you to research all of the options.
The general rule states that more features lead to high fees, but that does not mean you cannot find a way to get around it. You can try maintaining a minimum balance or making suitable deposits, and then the extra pay for the features will be worth it.
2. Checking your credit options
In most of the cases, when one applies for a new second chance account, the bank pulls all the credit reports. Most banks use a national level consumer credit service to report any negative account history. If a regular bank account has been denied to you at any point in time, it is likely because of what the bank has found on your credit report.
Try taking a look at your credit report from all the three major reporting agencies to get an idea of what the bank will see when you go on to apply for a second chance account. Bad credit is only going to diminish your chances, and in case there are any inaccuracies or errors in your account, you need to contact the authorities and get it corrected or removed as soon as possible. Your credit report is one of the significant determinants of you being able to open a second chance account.
3. Considering a credit union
According to the second chance banking guide, the credit unions provide second chance accounts, and they also give you a number of advantages over a traditional bank. The credit unions are mostly not aimed at profit, and they mostly emphasize on serving the clients rather than amassing big revenues. The credit unions are smaller than the banks, and that is why the overhead costs of these unions are lower than the banks, and they also tend to charge lesser fees.
However, credit unions come with certain criteria that you have to meet to be applicable to them, like working for specific companies or residency in specific areas. It is great for you if you are eligible according to the criteria of credit unions as in that case apart from the second chance account, you will also get lower rates on savings and loans.
The ChexSystems and second chance bank accounts are good options when going without the help of any bank account gets inconvenient and using a prepaid debit card to manage the money feels like a hassle. However, since it is a significant financial decision, make sure to read the fine print before giving the nod to any bank.