If you're on ChexSystems, Savings Accounts Will Also Be Denied
If your name winds up in the database for ChexSystems, savings accounts can also be extremely difficult to open. Financial institutions report to ChexSystems the names of individuals who they feel have mishandled a checking and/or savings account.
Banks use ChexSystems as an excuse to indiscriminately weed people out of the banking system. Sure, there are people out there who have previously committed acts of bank fraud with intent, but what about law-abiding people who only wrote a couple of bad checks by accident? Or someone who may have been irresponsible with their account in the past, but has learned their lesson? These people don’t deserve to be punished for five years. It's an extreme punishment that should be taken far more seriously than it is by the banking representatives that control the ChexSystems list.
Some Bones to Pick
A serious point of contention is the fact that the use of ChexSystems list by banking institutions is not well known. Most people haven't even heard of it until they are in trouble because of it. Knowing the consequences that result from actions makes it far less likely that a person will commit an act. Many people are simply unaware of what could happen because of it. If they knew that bouncing a check or going overdraft on an account could land them in the hot seat for five years, then they would probably be much more careful about balancing their books.
ChexSystems help is available. The reality is that if you're added to the ChexSystems list, then banks who use that list assume that they're not going to make much money off of you – that's the stigma. So it becomes an excuse to deny you a checking or savings account, and an effective one at that. Millions of people are affected by this. The following is a breakdown of the three options available to you if you have been denied a checking or savings account because of ChexSystems:
1. Get Off CheckSystems List. This is the best possible scenario. For some people this will be easier than others. If an individual is on the list because they passed numerous checks on a closed account (for example), then it will be much more difficult for that person to argue their way off the list, as opposed to a person who is responsible for a couple of oversights that resulted in overdrafts. You can do this by contacting the banking institution that put you on the list or ChexSystems, directly. ChexSystems official website is www.consumerdebit.com. You can find contact info and answers to questions there.
2. Use Banks Without ChexSystems. Approximately 85% of banks and credit unions in the U.S. use the ChexSystems list. So finding a bank that doesn't use them is very challenging. Apparently, they're out there, but good luck. Also, some banks that use ChexSystems are beginning to realize that denying everyone that has a ChexSystems report (which are more than eight million people, by the way) is simply not a smart way to conduct any business. There are banks that will look at the circumstances of an individual's case before passing a judgment. Look for banks and credit unions that offer special accounts that have names like "fresh start checking," "second chance checking," "new leaf savings" etc.
3. Switch to a Banking Alternative. There are options available. You don't have to write paper checks anymore. Seriously, forget about banks, ChexSystems, savings accounts, checking accounts, and all the rest of the hassle associated with this flawed system and open a secured personal money account. This type of account comes with options for direct deposit of paychecks, ATM cards with a VISA or MasterCard logo, and online bill payment. Go to the banking institutions competition and see how they like that. If enough people are forced to do that because of this unjust system, then it will have an impact on the way institutions use ChexSystems, Inc. in the future.
