Banks and credit unions are able to check your history against the records maintained by ChexSystems, TeleCheck, and EWS. If you are listed in any of these databases, you may be turned down for an account.
Being as these records are maintained for a period of five years, waiting for your entries to be cleared is not an option. You need a banking solution, and you need it now.
Thankfully, there are banks and credit unions out there willing to give a second chance to customers listed in ChexSystems, TeleCheck, and EWS.
The accounts which they offer to customers listed in these databases are referred to as “second chance” bank accounts.
Table of Contents
- What are ChexSystems, TeleCheck, and EWS?
- You Cannot Bank Just Anywhere
- What Are Second Chance Bank Accounts?
- Best Second Chance Bank Accounts for 2018
- Are Second Chance Bank Accounts the Same as Non-ChexSystems Bank Accounts?
- Can You Dispute Your ChexSystems Record?
- Best Alternatives to Second Chance Bank Accounts for 2018
- Best Banking Practices Going Forward
- Second Chance Banking FAQ
1. What are ChexSystems, TeleCheck, and EWS?
ChexSystems, TeleCheck, and EWS are agencies which monitor and report the banking histories of hundreds of millions of consumers. Those who are flagged by these agencies have records in their databases. ChexSystems is the largest of the lot. Over 9,000 banks and credit unions across the country rely on it.
Banks and credit unions run your name through one or more of these databases when you apply to open an account. If they pull up a record, you probably will not be able to open an account.
A wide range of offenses can get you listed in ChexSystems, TeleCheck, or EWS. Here are some examples:
Unpaid overdraft fees (probably the most common reason to be listed)
Abuse of your debit card
Non-sufficient funds losses
Various forms of check-related fraud
Failure to pay other fees or service charges
Sometimes the offense is simply listed as “Undisclosed”
Thinking back, you may be able to figure out exactly what got you listed. But in many cases, the incident may have been so small that you have forgotten about it—or never even been aware of it in the first place.
2. You Cannot Bank Just Anywhere
If you are listed in ChexSystems, you will be hard-pressed to find a bank or credit union willing to consider you. It is not that there are not options out there—it is just that only a minority of institutions are willing to ignore your ChexSystems record.
Earlier I mentioned that 9,000 banks and credit unions in the US screen applicants through ChexSystems. In all, that adds up to over 100,000 branches. It also accounts for 80% of banking institutions in the country.
If you pick an institution at random and go and try to open a bank account there, you only have a 2 in 10 chance of success.
Actually, your chances are probably even slimmer than that. Why? Because if you happen to be listed in TeleCheck and/or EWS as well, that too can raise a red flag on your name. A bank which does not look up your ChexSystems record may still run a TeleCheck or EWS check and end up turning you down anyway.
Obviously you can waste quite a bit of time doing this, and get steadily more discouraged by rejection after rejection.
It is best not to put yourself through that—and you do not have to. Instead, you can open a second chance bank account.
3. What Are Second Chance Bank Accounts?
Second chance bank accounts are so-named for the simple reason that they are offered by institutions that are willing to give you a second chance to prove that you are a trustworthy, reliable banking customer.
Banks and credit unions which provide second chance accounts do so in full knowledge of your ChexSystems, TeleCheck or EWS record.
Based on the information they see on your file, there is a possibility that you will still be denied (if for example you committed repeated counts of check fraud, most banks will not want to risk dealing with you).
In the majority of cases, however, approval is likely. Second chance banks know that good customers can go through lapses in judgement or attention, or may find themselves in dire straits now and again.
So while a bank which uses ChexSystems may reject you for your unpaid overdraft fee or non-sufficient funds loss, a second chance bank will probably be willing to overlook these kinds of offenses and offer you an account.
In fact, approval rates for second chance bank accounts are very high, and most banks process customer applications very quickly. Features offered by second chance banks are comparable to those you would enjoy with a regular checking account. If you apply for a second chance bank account today, you could be banking again in no time. This is the simplest and fastest way you can start raising your credit score right now.
4. Best Second Chance Bank Accounts for 2018
Ready to get started with second chance banking? Below you can view our top recommended second chance bank accounts for 2018. These are the accounts with the lowest fees, best features and benefits, and highest approval rates.
You can also scroll down past these options to learn more about second chance bank accounts.
3. Wells Fargo Opportunity CheckingExcellent choice for those wanting to bank with Wells Fargo
While BBVA has become a big name in the world of second chance bank accounts, many people are not as familiar with it as they are with a huge institution like Wells Fargo. If Wells Fargo declines you for a standard checking account, you may still qualify for their second chance account, called “Opportunity Checking.”
Why Choose Wells Fargo Opportunity Checking?
- You can open an account just by depositing $25.
- You can pay your bills and manage your money online. A mobile banking suite is included.
- Use over 13,000 Wells Fargo ATMs free of charge.
- Your account includes a debit card as well as checks.
- The monthly maintenance fee can be waived. For this to happen, you need to be making monthly direct deposits totalling at least $500, or you need to have a $1,500 minimum daily balance. Can’t meet either of those requirements? The fee will still be waived if you use your debit card at least 10 times each month.
- Additional features include account alerts, 24/7 fraud monitoring, and zero liability protection for your debit card.
Is Wells Fargo Opportunity Checking Right For You?
Opportunity Checking may be a good fit for you if you are keen to open an account at Wells Fargo but your banking record disqualifies you from getting a regular account.Apply Online
4. PNC Foundation CheckingGreat choice for customers who want to bank with PNC
Availability: Alabama, Delaware, the District of Columbia, Florida, Georgia, Kentucky, Indiana, Illinois, Maryland, Michigan, Missouri, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Virginia, West Virginia, and Wisconsin.
PNC is not available in every state, but it has a significant presence throughout the US, particularly in the Midwest and on the East Coast. Many customers are unaware that PNC offers second chance banking through a program called “Foundation Checking.”
Why Choose PNC Foundation Checking?
- There is zero balance requirement for a PNC Foundation Checking account.
- Make use of PNC’s ATMs and other conveniences and services.
- Improve your financial skills through PNC’s courses (required).
- Upgrade to a standard account after 6-18 months.
Is PNC Foundation Checking Right For You?
PNC may be a great option if you are looking for additional educational and support as you start back up with banking. You also should consider PNC if you have an account which may regularly dip below the $25 balance threshold requirement that is typical at other banks.Apply Online
5. Radius Bank Essential CheckingAn excellent online second chance banking option
Looking for a way to get back to using a checking account while you enjoy the high interest you can receive through banking online instead of at a traditional brick-and-mortar institution? Consider opening an Essential Checking second chance account with Radius Bank.
Why Choose Radius Bank Essential Checking?
- Manage your money on your desktop or mobile device with online banking.
- The minimum deposit is $10.
- Your account carries a $9 monthly maintenance fee.
- Set personalized alerts to track account activity.
- Pay your bills for free online.
- Receive free eStatements.
- Set up direct deposit.
- Transfer money to friends and family.
- You receive a chip-enabled Radius Debit Card for free. An app is available to help you manage your card. You can even activate or deactivate it with a single swipe. The daily limit for your debit card is $500.
- Deposit checks with your mobile device.
- Upgrade after 12 months of good standing to a standard Radius Checking Account.
Is Radius Bank Essential Checking Right For You?
If you are not picky about service fees and prefer not to bank with a brick-and-mortar institution, you may find that Radius Bank Essential Checking is a convenient alternative.Apply Online
5. Are Second Chance Bank Accounts the Same as Non-ChexSystems Bank Accounts?
Now that you have had some time to peruse some of the banking options available to you, you may wish to learn a little bit more about second chance banking as well as some of the alternatives you can consider.
One thing you are probably wondering is whether second chance bank accounts and non-ChexSystems accounts are the same thing or not.
That really depends on how specific you want to get. Technically, no—second chance and accounts without ChexSystems are two different things.
- When you apply for a non-ChexSystems bank account, your ChexSystems record is not screened.
- When you apply for a second chance bank account, your ChexSystems record usually is still checked.
That being said, a lot of the time, the two terms are used interchangeably. The BBVA second chance accounts that we recommend actually can be considered non-ChexSystems accounts as well. If you are not eligible for the standard versions, you can open second chance versions instead.
Here is what second chance bank accounts and accounts offered by banks which do not use ChexSystems have in common:
- The institution may check your EWS or TeleCheck record, whether they look up your ChexSystems record or not.
- Accounts may be free of charge, or there may be a monthly maintenance fee.
- There may or may not be a balance requirement, but it will typically be low.
- Accounts with and without overdraft protection are available.
- Online banking and bill pay are usually available.
- Your account includes a debit card for purchases.
- After a certain period of time in good standing, the bank will usually let you upgrade to a standard checking account.
Here are some differences between accounts without ChexSystems and second chance bank accounts:
- Second chance banks may look up your ChexSystems record, while non-ChexSystems banks will not do this.
- The other big difference is that second chance banking may come with some additional limitations or strings attached. The institution may require that you enroll in a course which teaches personal finance in order to open an account.
All in all, both of these types of accounts have a lot more in common than otherwise. This is the reason why they tend to be grouped together, despite the differences between them.
Searching for a comprehensive list of the top banks without ChexSystems? Take a look at our in-depth non-ChexSystems banking guide.
6. Can You Dispute Your ChexSystems Record?
Before you go to open a second chance or non-ChexSystems account, you may wonder if it is possible simply to expunge your record.
You certainly can dispute your record.
But can you actually get it erased? Maybe, maybe not.
Disputing ChexSystems involves initiating a complex series of steps:
- Order your ChexSystems report.
- Learn how to interpret your report.
- Search through your report for inaccurate entries.
- Take up the issue with the financial institutions which reported you, and ask them to contact ChexSystems on your behalf.
- Contact ChexSystems yourself, explaining that the entries are wrong.
- Furnish documented proof to back up your case.
- Make sure you are submitting the proper forms through internet, mail or fax.
- Submit a Demand for Removal Letter if no one answers your request within the allotted timeframe.
- If ChexSystems does concur with you and fails to follow through, fill out and turn in a Procedural Request.
- If your dispute falls through, you will need to fill out a Request for Consumer Statement.
- If you still believe that you are in the right and your record should be cleared, you can file a complaint with the Office of the Comptroller of Currency (OOC), the Consumer Financial Protection Bureau (CFPB), or another regulatory agency.
- You also have the option of taking ChexSystems to court.
Read up on these steps to dispute ChexSystems in detail.
Needless to say, this process can be overwhelming. There are a lot of possible snags along the way, and it may be months before you reach any sort of resolution. There is a very good chance it will not be in your favor.
Also consider that if your entries are correct, disputing them is entirely a waste of time and energy.
Either way, the fastest and easiest way to return to banking is to apply for a second chance bank account. Get back to establishing a good record and enjoying the services and conveniences you need without the hassle of disputing ChexSystems.
7. Best Alternatives to Second Chance Bank Accounts for 2018
If for whatever reason you still do not qualify even for a second chance bank account, what can you do?
As mentioned previously, we do have a detailed page on non-ChexSystems bank accounts. Some of the banks we recommend in that guide which do not use ChexSystems at all may fit your needs.
Second chance bank accounts as well as bank accounts without ChexSystems really are the most convenient options. They are easy to get started with and provide you with the best features.
If you cannot get approved for whatever reason however, or you simply are looking for alternatives, here are some additional possibilities:
- E-wallets. PayPal and similar services sometimes offer debit cards to select customers.
- Secured credit cards. You will need to use cash, a vehicle, or another asset as collateral.
- Foreign bank accounts. If you live close to the border, check if a foreign bank will let you open an account.
- Prepaid cards. Fees on prepaid cards have come down, and some of them include a surprisingly large range of benefits.
- Money market accounts (brokerages). If you can swing a large balance requirement, this is another option which may work out.
Of all of these alternative options, the two best are prepaid cards and money market accounts. Below are some recommendations for each.
Availability: Nationwide (most states)
TD Ameritrade is one of the best known brokerages around. Since this institution screens customers on an individual basis, ChexSystems is not used to make approval decisions. The Convenience account is the brokerage’s fee-free account option.
Why Choose TD Ameritrade Convenience?
- Zero monthly service fees are charged so long as your balance doesn’t fall below the $100 minimum.
- Make purchases with a TD Ameritrade debit card.
- Cash checks for free.
- Use free ATMs.
- Bank online and with your smartphone or tablet.
- Customer service is available 24/7.
Is TD Ameritrade Convenience Right For You?
If you can afford to maintain the $100 minimum balance, TD Ameritrade Convenience is a workable alternative to a second chance bank account.Apply Online
Availability: Nationwide (most states)
TD Ameritrade also offers another brokerage account which may satisfy your needs. While there is a monthly service fee for the “Simple” account, you are freed of the balance requirement.
Why Choose TD Ameritrade Simple?
- There is no requirement to keep a minimum balance in your account.
- $5.99 monthly service fee.
- View online statements, including images of checks.
- Pay bills and monitor account activity online.
- Contact customer service 24/7.
Is TD Ameritrade Simple Right For You?
If TD Ameritrade appeals to you, but you cannot keep at least $100 in your account at all times, the Simple account may end up being more suitable than the Convenience account.Apply Online
Another brokerage which is reputed to skip ChexSystems verification is Merrill Lynch. If you do not want to apply at TD Ameritrade, Merrill Lynch is a viable alternative.
Why Choose Merrill Lynch?
- Get started immediately with a $2,500 minimum deposit.
- Manage your account conveniently online.
- Contact customer service 24/7 if you need support.
Is Merrill Lynch Right For You?
Merrill Lynch is only a good option if you have the few thousand dollars you need to open an account.Apply Online
Prepaid Debit Cards
Green Dot is a well-known prepaid debit card company which offers its services to customers throughout the US.
Why Choose Green Dot?
- There is zero minimum balance requirement for your card.
- The monthly service charge is just $5.95.
- Green Dot never charges overdraft fees.
- Get paid through direct deposit straight to your Green Dot account.
- Earn cash-back on your purchases.
- Green Dot reports to credit bureaus, so if you need to boost your score, this is an easy way to do it.
- Deposit to your Green Dot account online, or at any of the company’s 100,000+ brick-and-mortar locations.
Is Green Dot Right For You?
If you can afford the monthly service charge, Green Dot provides you with a fast and easy way to get paid and pay others, plus additional benefits.Apply Online
Around 68 million consumers throughout the country use Netspend in lieu of traditional banking services.
Why Choose Netspend?
- Netspend does have fees, but you can choose a feet structure which fits your needs.
- There is zero minimum balance requirement.
- You do not need to pay an activation fee.
- Your credit will not be checked when you apply.
- You can use direct deposit with your account.
- Receive a personalized debit card.
- Use the mobile app provided to manage your card conveniently from any location.
- Track your account activity with personalized alerts.
- Earn Payback Rewards.
Is Netspend Right For You?
Those looking for a prepaid card account which they can customize to their needs may appreciate the features and fee structures offered by Netspend.Apply Online
Chime is another popular prepaid debit card which you can get without a credit check and without worrying about your ChexSystems record.
Why Choose Chime?
- Sign up in a matter of minutes.
- Getting started is free.
- No credit check is required.
- Your account has zero monthly maintenance fees.
- There are no overdraft fees.
- There are more than 30,000 free ATMs to use.
- There are no fees for transactions.
- Set up direct deposit.
- You can even open a savings account.
- Other features include a zero liability protection policy, account alerts, and the option for automatic savings.
Is Chime Right For You?
If you are looking for a prepaid card solution which is quick and easy to set up, Chime may be just what you are after.Apply Online
8. Best Banking Practices Going Forward
After half a year to a year with a second chance bank account, there is a good chance that you will be able to open a regular checking account at the same institution.
Hopefully from that point onward, you will maintain a clean banking record. But how can you make sure you do not end up in ChexSystems, EWS or TeleCheck again?
Anyone (including your bank or credit union) can make a mistake, so there is no surefire way to guarantee that you will not run into this issue in the future. But the following tips can minimize your chances of another mishap.
- Check your account balance on a regular basis. Make it a habit.
- Set up alerts for when your balance falls under a certain threshold.
- Also set alerts for large payments and transfers.
- Review your budget at least once a month. Figure out where your all your money is going. Cut back on any unnecessary expenses. Consolidate debts and take other steps as needed to simplify your finances and reduce what you owe.
- Understand the terms governing account balance, fees, and so on to the letter.
- Make sure that you never allow your account to dip below the minimum threshold.
- If you do incur a fee, either pay it that day or ask customer service to retract it (which can be very easy or very hard, depending on the bank, the branch, how long you have been a customer, who is working that day, and how busy they are).
- Avoid ordering checks from companies which deal with ChexSystems.
- Use your debit card on a routine basis.
- If you can set up direct deposit, do so.
- It should go without say, but you need to follow the rules. Do not try to bend or break them in any way. Even if you are desperate, it is never worth it.
- If an issue does come up, contact customer service immediately and work with an agent for a swift resolution.
If you follow smart banking practices like those described above, you can protect your banking record. Ultimately, this will help you keep fees and balance requirements to a minimum and increase your access to banking services.
9. Second Chance Banking FAQ
Q: Which is better, a second chance bank or a bank without ChexSystems?
A: Neither option is really “better.” The features and benefits of the two types of accounts are almost identical. Some second chance banks do insist that you take an educational course to help you better manage your finances, but many do not. Plus, while you may look at this as a detractor, it really is not; you may find the lessons useful.
Q: Is it easier to qualify for a non-ChexSystems bank account or a second chance bank account?
A: You might think it is always easier to qualify when ChexSystems isn’t run at all, but this is not always the case. Sometimes a bank which does not look up your ChexSystems record may still find you in EWS or TeleCheck.
To a second chance bank account, you are a known quantity. It is true that they have seen your record, but they have assessed the risk of numerous customers who are listed in ChexSystems, and have decided that most applicants are still worth taking on.
So in some cases, you might have an easier time being approved by a bank which doesn’t look at ChexSystems, but in others, you might have an easier time being approved by a second chance bank.
Q: Why is a second chance bank account better than a money market account or prepaid debit card?
A: It is true that money market accounts and prepaid debit cards offer many of the same features as second chance bank accounts. They do not include all banking features however, and they have other drawbacks. Most money market accounts carry higher balance or initial deposit requirements. The majority of prepaid debit cards involve monthly service fees.
Q: Are second chance bank accounts as good as standard checking accounts?
A: On the whole, you will probably find your second chance bank account as satisfying as any regular checking account you have held in the past. You likely will not notice a difference in terms of the features that you use every day. Even fee and balance requirements may not be much more stringent than they are for standard accounts.
Q: How does one apply for a second chance bank account?
A: Getting started is easy! Just scroll up to our list of recommended second chance bank accounts above, or jump down below to select your location from our list. Select an account which offers the features you are looking for and click through to apply online in minutes. If you’re not sure what to choose, give BBVA ClearConnect or ClearChoice a try!
When you are declined a standard checking account because of ChexSystems, TeleCheck or EWS, you may feel like the banking system has abandoned you.
But your situation is far from unique. Most customers with ChexSystems records have committed minor infractions, often involving only a few dollars.
Banks and credit unions offering second chance bank accounts recognize how absurd it is to decline reliable customers bank accounts simply because of an insignificant incident in their past.
Why go another day without banking when you don’t have to? It is time to start building a solid record again with an institution that recognizes your value as a customer.
So open a BBVA ClearConnect or ClearChoice account, or choose another of our recommended accounts. Before you know it, you’ll be back to paying bills online, using your debit card for purchases, and managing your finances easily and conveniently!
Second Chance Banks & Credit Unions by State
Looking for more information and additional options available in your area? Select your state from the list below to find out all your options for banking.
- District of Columbia
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Rhode Island
- South Carolina
- South Dakota
- West Virginia