Are you a Los Angeles resident who’s trying to open a bank account but is unable to because you’ve been reported to ChexSystems? Well depending on what your requirements would be, and your specific situation, there are several options that are available to you.

Did you get reported to ChexSystems because of fraud?

If that’s the case, then you will have a very hard time finding a bank that will agree to do business with you. Even some of the prepaid debit cards may decline your application.

Did you get reported by mistake?

Learn how to dispute a ChexSystems report.

Did you get reported to ChexSystems because of unpaid overdrafts?

If you have an overdraft that you haven’t paid for, the bank will close your account and send your information to ChexSystems.If you find yourself unable to open new accounts because of this, you need to go to the bank that reported you in the first place; they’re the only way for you to get out of ChexSystems. Explain what happened and offer to pay for what you owe, but in exchange they must agree IN WRITING to write ChexSystems and ask that your name be removed. It’s very important that you get their agreement in writing because they may not follow up.

If you paid the overdraft  and are waiting for your name to be cleared on ChexSystems’ database, you can ask the bank for proof that your debt is paid off. Some banks will agree to open an account for you even if your name is showing on ChexSystems, as long as you can prove that you don’t owe money to another bank.

How long has it been since you were reported?

Your information stays on file for five years. If it’s been four years and you only have one year to go, maybe it’s best that you wait it out.

What are my checking account alternatives in Los Angeles?

If all else fails, you can use a prepaid debit card as a checking account alternative. There are many of them that will give you most of the features you would get with a regular checking account: Western Union, Ace Elite, Rush Card, Walmart MoneyCard, Amex Prepaid, and so on.

Why can’t we give a list of L.A. banks that don’t use ChexSystems?

The first reason is that, from a logistical point of view, that would be a nightmare. Banks change their policies all the time and the sheer number of them would make such a list so hard to maintain that there’s no way it could be priced in a way that makes sense for both the customers and the people that make it. Lists that you see marketed online are just bogus lists copied from Yellow Pages and other sources and pasted.

The second reason is that many banks may actually open bank accounts for people on ChexSystems but would rather not advertise it, because it’s something they do on a person to person basis, and they don’t want it to get out of hand. With the number of people in financial trouble, non Chexsystems banks are in high demand these days.

Non ChexSystems Banks In Los Angeles | LA Second Chance Checking Accounts

Bad Credit Bank Accounts

There are a few situations where you can find yourself looking for a financial institution (whether it be a bank or credit union) that is offering bad credit bank accounts. For example, this financial product can be very useful for people who have a poor credit history, have filed for bankruptcy, or have a County Court judgment registered against them. In either of those cases, it becomes very difficult to get a checking account at any one of the major banks.

Everyone knows that nowadays you can hardly function if you don’t have a bank account. Getting a bad credit bank account can be the first step that you need in order to re-establish yourself as a desirable customer for banks. Honestly, opening a bad credit bank account is not going to be easy. Check systems is very aggressive in its marketing to banks so that they can use its services and it’s estimated that roughly 80% of them do so. Your best bet is to check the policies of the banks where you would like to open accounts because different banks have different policies regarding checking accounts for people with bad credit.

Actually a lot of the people looking this type of account may feel some type of shame because this is not something that they would have ever thought could happen to them. But the recent economic downturn has spared nobody, and it has become easier than ever to face a bad spell and then be reported to ChexSystems, where your information remains for five years unless you’re the determined type and decide that you want to get out of Chexsystems and take the necessary action.

Opening a bad credit bank account will at least get you back into the financial world. You will once again have check writing privileges, the ability to pay your bills online, access to ATM transactions, debit cards, and so on. And let’s not forget not having to stand at the check cashing store every week or every other week and carrying large amounts of money around. So with that in mind, financial institutions have created specific products for people who need a “fresh start”, as they call it.

The first thing you need to do when looking for second chance checking accounts is to make sure that the accounts are FDIC-insured. Just in case you’re wondering what we’re talking about, the FDIC insures every bank account for up to $250,000 (actually you can get even more coverage, so it could prove useful for you to check out the FDIC’s website if you want more details about that). What that means for you, in real terms, is that any amount of money that you have in that bank (up to $250,000) is fully insured: you can’t lose it.

The second thing you need to be looking out for is whether or not this second chance checking account that you’re thinking of opening comes with a Visa or MasterCard branded debit card. This is very important. Having one of those pretty much allows you to do business everywhere those cards are accepted. That includes online shopping, ATMs, and most businesses worldwide.

Thirdly, you want to compare what the different financial institutions are offering. Specifically:

• Is there a minimum opening balance?
• Is there a minimum balance requirement?
• Are there any monthly maintenance fees?
• How much is the card reload fee?
• How much is the ATM access fee?
• How long before you can apply for a regular bank account?
• Do you get any check writing privileges?

Well, you get the idea.

Repairing Your Credit

What we’ve discussed earlier was just the short term fix. Now let’s look at the long term fix. And that, of course, is repairing your credit so that you don’t have to settle for second chance credit accounts. With a bit of planning, you can make your credit history look a lot better in a matter of months (How long does credit repair take?). Obviously, credit repair is beyond the scope of this article (or even this site) but common sense suggests the following:

• Know how much you owe and who you owe. This can be done by getting copies of your credit report from the three major credit bureaus: Equifax, Experian, and TransUnion.
• Check the accuracy of those reports. If you spot any mistakes, take the necessary steps to have them corrected.
• Put in place some type of monitoring system so that you can a) keep track of how your credit is going and b) prevent identity theft.
• Pay your bills on time.

How To Get A Bank Account With Bad Credit

According to the latest available statistics, ChexSystems is doing business with roughly 80% of the banks and credit unions out there. Maybe we’re different, but while most people tend to focus on the 80% figure, we tend to see things the other way around. And the other way around is simply that there are about 20% of the banks and credit unions out there that don’t use ChexSystems. If you stop and think about it, that’s quite a lot of banks! Now we’re not going to lie to you and tell you that those non-ChexSystems banks are popping up in every corner, but if we tell you that there’s a good chance that there are a few in your area, we won’t be lying to you either.

You know the deal: sometimes there’s a company out there that ventures off the beaten path, in order to give its customers a chance at something they really need. In other words, the company takes a risk, in order to make some money by serving a neglected portion of the population. So it is with banks that offer checking accounts for people with bad credit. Because the vast majority of banks out there use ChexSystems to determine whether or not they will open a checking account for a new customer, people with a negative record are left out in the cold.

While it might have been easy to turn away people when times were good, things are different now. The economic crisis means that a lot of people have fallen on hard times and have ended up with negative marks on their ChexSystems record. That doesn’t necessarily mean that they wouldn’t be good customers for the banks and/or credit unions. So those financial institutions have started to try and look beyond this simple aspect. There are now some that simply don’t check your ChexSystems record. Some others do, but also look at other financial information before they make their decision. What that means is that banks do openchecking accounts for people with bad credit, so you can still get a second chance checking account and be able to benefit from banking services.

Related: How to open a bank account after bankruptcy

Now it’s important to point out that all banks are definitely not created equal. If you’re going to open afresh start checking account a non-ChexSystems bank, there’s a few things you need to make sure are kosher, because all it takes is for you to fall on one bad apple, and you’re pretty much screwed. Here’s how to find a “bank without ChexSystems”

Finding Good Banks That Do Not Use Chexsystems

1. The most important part of finding a non-ChexSystems bank is, of course, doing your homework to make sure that the bank(s) you’re considering giving your business to are INDEED not going to run your ChexSystems report. Sometimes, and especially when they’re in a situation where they’re opening a lot of accounts in a short period of time, they will open up the account, pending verification. After running the scan, and they find negative marks on your report, your account will be closed. Period. Or, (and that’s even more embarrassing), if the bank checks on the spot, you will be declined in public! So make sure you have your facts right.
2. The second most important thing is that, just because you’re looking for a bank that doesn’t run your ChexSystems report doesn’t mean that you should settle for just ANY bank that you find. You still need the protection that comes with that financial institution being FDIC insured. So you need to have proof that the bank is FDIC insured before you open that checking account. In the case of credit unions, they have to be NCUA insured (that’s the equivalent of FDIC insurance, but for credit unions).
3. Finally, make sure that you’re not going to get some crippled service. If you can’t get the same (or almost the same) level of convenience, then it kinda defeats the purpose to go to such great lengths. You will need to get at least the following: check writing privileges, Visa- or Mastercard-branded debit card, and online banking. Also take a good look at their fee structure, in order to make sure that you’re not getting nickel-and-dimed.

Being reported to ChexSystems doesn’t necessarily have to mean that your financial life becomes a living hell. As previously stated, there are many financial institutions (banks and credit unions alike) that will open asecond chance checking account in your area for you regardless of, or in spite of, your ChexSystems profile. All you need is to do your homework and find the reliable ones that will fit you best.

© “Banks Without Chex Systems” | How To Find A Good Second Chance Bank

Fresh Start Checking Accounts

If we’re talking about Fresh Start Checking Accounts, then there has to be a negative record at one of the companies that track people’s checking activities. Maybe you’re been reported to Chexsystems, or maybe you have a record with Telecheck, it doesn’t even matter. What matters is that you’re going to have to find banks that don’t use Chexsystems in order for you to get what is also known in the industry as a second chance checking account. Chexsystems is kind of the banking system’s watchdog, in that it keeps tabs on your bank related history and will keep on putting notes against your name you have amounts overdue against your name or if you have the fraud against your name.

What that means is that a negative ChexSystem record will prevent from qualifying for a checking account at roughly 80% of the banks in the country. Until people are victims of it, they have no idea how bad it is to not be able to have a checking account: to make a long story short, no access to checking services like ATM transactions, no telephone banking, no online banking, no direct deposit, and you have to carry cash to conduct all your transactions: without a bank account cash is your only option. Not only is it impractical to carry huge amounts of cash in your pocket, it’s also very risky.

The fresh start checking account helps solve this predicament. Of course, it comes at a cost (most banks charge a monthly fee of $5 to $10 to open a fresh start checking account under your name), but consider it as a small price to pay for your convenience

Upgrading from Fresh Start Checking Account to Regular Checking Account

Plus, it’s good to keep in mind that many of those banks also make it a policy to upgrade your fresh start checking account to regular checking account status within 6 to 12 months, provided that you’ve kept your account in good standing and incident free over the specified period. By incident free, they mostly mean that you’ve had no NSF fees.

Banks That Do Not Use ChexSystems & Offer Fresh Start Checking Accounts

There are a number of banks that are now offering those second chance checking accounts, because they either don’t really worry about it, or they realize that a lot of people end up with a negative Chexsystems record or a Telecheck report unintentionally or because of something they didn’t know. Those people deserve a second chance and they get to have a checking account and a debit card with either the Visa or Mastercard logo.

Of course, it’s best if you don’t end up getting in trouble with either Chexsystems or Telecheck, because it can really be a nightmare. But in case you do end up being reported to one of them, it’s always good to know that you can still open a checking account. It’s not going to be free, and you’ll have a lot more restrictions compared to regular checking accounts, but at least you’ll be able to access basic banking services.

Fresh Start Checking Account: Banking For People With A Negative Chexsystems or Telecheck Record

One of the reasons why I started this website is that I have been meeting with a lot of people who insist that being able to open a checking account once you’ve been reported to Chexsystems is the closest thing there is to mission impossible, whether it be finding a local non-Chexsystems bank or an online bank that doesn’t use the Chexsystems reporting information to open new checking accounts. It’s easy to understand why so many people people would believe that, since the “big” banks typically will not do business with you once you’ve been reported. You’re left with the only option of looking for other, smaller banks, and the information is not readily available. And let’s not forget scammers who will try and sell you outdated lists, that will do nothing to help you in your predicament.

It certainly is frustrating to look for weeks and weeks and just keep getting turned down, so at that point you start thinking that you’re probably fighting a losing battle. You think that you may just have to deal with it and settle for those awkward “solutions” that are touted as alternatives for people who can’t open checking accounts because of Chexsystems. To be totally honest, finding a non-Chexsystems bank is not the easiest thing, but with some useful information in hand, you can already start narrowing down your search and be more productive. In order to improve your chances of success when negotiating with banks, order your chexsystems report to see what information is in it and try and resolve any issues first. You might also want to learn about the ChexSystems report dispute process.

The first thing you need to know is that you should definitely not expect any bank to openly advertise which reporting system they use (if any). If they did, they would be just opening a can of worms. They would be swamped with new people who want to open checking accounts, but they would have to sit there and sort through hundreds, if not thousands, of applications to handpick the ones that look promising. It’s just not cost-effective. What you can do, though, is take your yellow pages and start calling and asking. The trick here is to ask for the branch manager or someone in the branch who ranks high enough to give you the information that you’re looking for. Also, if you can, try to sweeten the deal. If you have a little bit of savings that you an open a CD with, mention it. Stuff like that will make you look more appealing as a customer and they’ll probably be more inclined to cut you a deal.

Of course, whichever banks that do not use Chexsystems that you find in your search, and that you’re considering opening second chance checking accounts in, absolutely has to be an FDIC-insured bank. There’s simply no way around that. If you fail to take this precaution, and the bank happens to go under, you will lose all the money that you deposited there. On the other hand, with an FDIC-insured bank, your money is insured up to $250,000 per account holder. Not a bad safety net.

In your search to open a non-Chexsystems checking account, you have to be on the lookout. You will find a lot of information out there and what we recommend is that you gather as much of it as you can. The trick is to avoid getting scammed for large amounts of money. If you find something that looks promising and is reasonably priced, check to see if you can get a money-back guarantee. This will typically protect you. Also, look around, check online banks (like Ally) if brick and mortar ones keep turning you down. Explore every free option before eventually turning to paid ones.

As a final word of advice, when you’re looking for advertisements, favor specific institutions over list sellers. The reason is that if an institution is advertising to people with bad credit or who have been reported to Chexsystems, it’s probably because at that specific moment, they probably have some kind of product or service that caters to this specific niche. Once they decide not to deal with this segment anymore, they will just stop advertising. A list, on the other hand, would have to be continuously updated to account for companies that enter the segment, as well as those leaving it. We’re not saying that it’s not possible to find a good, legitimate list. What we’re saying is that you’ll probably have better luck with the companies that advertise to you than you will with the list sellers.

Finding A Second Chance Checking Account In Your Local Area