How to Clean Up a ChexSystems Report

Quick Answer

To clean up your ChexSystems report, request a copy and address any issues to improve your chances of getting approved for a checking account.
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If you're having trouble opening a bank account, it may be because there are some negative items on your ChexSystems report. By cleaning up your report, you can improve your chances of getting approved for a new account. Here's what you need to know.

What Is ChexSystems?

ChexSystems is a banking reporting agency, similar to credit reporting agencies like Experian. The difference is that ChexSystems only keeps track of your deposit accounts with banks and credit unions.

ChexSystems maintains a report of certain account activities and reasons accounts were closed. Most banks and credit unions use this information to determine whether to allow you to open an account with them. Examples of items that can show up on your ChexSystems report include:

  • Involuntary account closure
  • Bounced checks and overdrafts
  • Unpaid negative balances
  • Account, card or ATM abuse
  • Suspected fraud or identity theft
  • Number of accounts applied for recently

Each bank and credit union has different criteria for which activities it will report and which activities may prevent you from opening a new account with them.

Cleaning Up a ChexSystems Report

1. Request a copy of your ChexSystems report. If you've been denied a bank account because of your ChexSystems report, it's a good idea to get a copy and address potential concerns.

Federal law allows you to obtain one free copy of your ChexSystems report every 12 months. You can also request a free copy when a bank refuses to open an account due to information on your report. To request a copy of your report, visit the ChexSystems website. Once the agency receives your request, you can expect to get a copy of your report within five business days.

2. Review your report. When you get it, look through it to determine what may have caused your denial.

3. Dispute any inaccurate information. If you find erroneous or fraudulent information, you have the right to dispute it. Include any supporting documentation you have in your dispute with the agency. Investigations typically take up to 30 days.

4. Pay any overdue amounts. If the report is accurate and you owe money, pay it as quickly as possible. If you don't have enough cash to do so, consider asking the bank or collection agency if they would be willing to settle for less than what you owe.

Once you've paid off your balance, you can request that the bank or collection agency remove the record from your ChexSystems report. You can also get a receipt showing that you paid the amount in full and send it to ChexSystems to have them update their records.

This process can take time, but it shows that you're working to improve your financial situation and can help your chances of getting a new bank account.

How Long Does a Report Stay on File?

If there's an item on your ChexSystems report that you can't have removed manually, it usually takes five years for it to fall off your report on its own. Unfortunately, this may limit your options to second-chance bank accounts and prepaid debit cards.

So if you can get something removed by disputing it or paying off a debt, it's best to do so to avoid having to wait.

Opening a Checking Account Without ChexSystems

While most banks and credit unions use ChexSystems or another consumer reporting agency, there are several that offer what's called second-chance banking. These financial institutions either don't check your ChexSystems report at all, or they're willing to look past some negative items. National examples include:

  • Capital One 360 Checking Account
  • Chime Second Chance Banking
  • GTE Financial Go Further Checking
  • Varo Second Chance Banking
  • Wells Fargo Clear Access Banking

You may also have luck finding second-chance banking opportunities with regional and local banks and credit unions. Call the institution directly to determine what your options are.

Issues with your ChexSystems report can cause problems if you need a new bank account. But fortunately, you're not without options. By getting a copy of your ChexSystems report and addressing the problems that are preventing you from getting approved, you can improve your odds for the next time you apply.

Also, consider getting a free copy of your credit report and check your credit score. While these may not help with getting a bank account, knowing where you stand and working to improve your credit history can help get you on the path to a better overall financial standing.