Checking Account

List of Banks Offering Second Chance Checking with No Opening Deposit

A second chance checking account is an account that you can open if you have a poor banking history. The account allows you to rectify your poor banking history as you benefit from a few banking services. Even though some second chance bank accounts require you to have an opening deposit, there are banks where you can get a second chance checking with no opening deposit.

Second checking accounts have limited services. For instance, you cannot get a debit card for most second chance checking accounts? Furthermore, most checking accounts limit the amount of money you can withdraw from your account, as well as the number of times you can withdraw cash. All these measures are meant to eradicate your bad behavior when it comes to handling money.

You may be wondering how banks can know your banking history. First, you need to know that, just as banks and other financial institutions report borrowers to the credit unions, banks also report those with poor banking practices to the ChexSystems. In addition, the body keeps records of bank account holders who violate bank regulations. As a result, every bank can access information concerning those with poor banking history.

What is ChexSystems?

ChexSystems is an agency entrusted to keep records of people with poor banking history. Every bank reports individuals who violate one or two regulations to the agency so that other banks can get the warning that a particular individual is not fit to hold a bank account.

When opening an account with a bank or credit union, the concerned institution has to run your details in the ChexSystems to see whether you have any history of misusing bank or credit in accounts.

Once you find yourself in the ChexSystems, your records will stay with the agency for up to five years. Unfortunately, that means that you may not get a standard account with any financial institution during that period.

 How do you find yourself in the ChexSystems?

Various banking issues can get you listed in the ChexSystems. They include the following.

i) Bouncing checks

Suppose you write checks that your balance cannot cover, the check bounces. Writing bouncing checks now and then definitely forces your bank to report you in the ChexSystems. Also, you can find yourself in the ChexSystems if you try to deposit bad checks.

ii) Closing your bank account with a negative balance

If your bank owes you money and you fail to pay before closing your account, then you can find yourself in the ChexSystems.

iii) Unpaid fees

Bank accounts require you to pay some fees such as account maintenance monthly fees, annual fees, overdraft fees, and any other applicable fee. If you fail to pay fees as agreed, then your bank may report you to ChexSystems.

How do you get out of ChexSystems?

Second Chance Checking with No Opening Deposit

The truth is that you won’t stay in the ChexSystems forever. There are ways you can remove your name from the agency. If you have not paid some fees to some banking institution, you have to clear it first. Moreover, you have to settle any negative balances and then get a receipt showing your payment and send it to ChexSystems.

You can also request your bank or the collection agency to clear your name from the system. Once you have done all that, you also need to show that you can handle another bank account responsibly for the future. You, therefore, need to get a second chance checking account that will help you to transit to a standard checking account.

Also, not all records about negative listings in ChexSystems are accurate. For example, you could be listed, but the records are erroneously listed under you. Also, there are cases of identity theft that can hit you hard. For example, if you think someone may have illegally used your details to open a bank account that led you to ChexSystems, you can dispute it.

Standard checking accounts have lots of advantages. For example, you can send money with a checking account number instantly, withdraw cash at an ATM point, among many other things.

In general, if you want to get out of the ChexSystems database, you can;

  • Pay all the existing debts and request your bank to remove your name from the ChexSystems.
  • Wait until ChexSystems clears your name from their database.
  • Dispute about identity theft
  • Dispute errors online or via a telephone call to ChexSystems.

List of Banks Offering Second Chance Checking with No Opening Deposit

The following banks will allow you to open a second chance checking account with no minimum deposit.

  • Chime
  • Varo Bank

Chime and Varo free checking accounts with no credit check no deposit are some of the banks that can help you improve your banking history.

Therefore, you can open a second chance checking account with any of the banks and deposit any later. Many other banks offer second chance checking accounts with a few dollars to open. They include the following.

1. BBVA Online Checking – $25 minimum deposit
2. Renasant Bank – $50 minimum deposit
3. United Bank – $50 minimum deposit
4. 1st Convenience Bank – $20 minimum deposit
5. TCF Bank – $25 minimum deposit
6. BancorpSouth – $50 minimum deposit
7. Regions Bank – $50 minimum deposit

How do I open a second chance checking account?

Opening a second chance account first requires you to identify the bank with the best account features. Then, you can inquire from your nearest banks about the second chance checking accounts and the features they have to choose the best.

Once you identify the best bank with the most attractive checking account, you can apply. However, you need to gather all the required information for opening an account. You need;

  • Social Security Number (SSN)
  • The government Identification Document – might be an ID card, passport, or driver’s license.
  • Physical address
  • Email address
  • Phone number

The Social Security Number (SSN) is essential for the matters of tax tracking and preventing the opening of illegal accounts. The SSN combined with an ID helps to identify you correctly. The physical address is essential to receive periodic paper statements and other tangible items such as debit and credit cards.

Your email and phone numbers are essential for regular communication that requires urgency. You can open an account online or visit the suitable bank’s nearest branch with all the requirements.

What is the alternative to a second chance checking account?

It is not a must to create a checking account to carry out various transactions for your business or personal expenses. You can just opt for other financial solutions such as;

1) Prepaid debit cards

A prepaid debit card does not require you to have a bank account. Furthermore, prepaid card issuers do not check credit, nor do they run your details in the ChexSystems. Finally, since you have to reload the cards to use them, no one will follow up on you.

Prepaid debit cards are a secure way to carry large amounts of money electronically. You can easily avoid the dangers of carrying large amounts of cash around, such as theft or misplacement. Prepaid cards allow you to manage them online, and in most cases, you may not need the card to make transactions.  

 2) Use mobile wallets

There are various mobile wallets that you can open accounts with online. Mobile wallets allow you to recharge, receive, and send money, as well as pay for goods and services online. Mobile wallets are easy to open on your smartphone so long as you have Identification documents, email address, phone number, and physical address.

Some of the mobile wallets include the following.

  • PayPal
  • Payoneer
  • Apple Pay
  • Google Pay
  • Facebook Pay
  • Venmo
  • Cash App, and
  • Skrill

PayPal is the most used digital wallet that millions of people worldwide rely on to send and receive money. You may as well pay for goods and services online and withdraw money to a bank account. Interestingly, you can use most of these wallets either over the web or use apps.

Do all banks use ChexSystems?

Not all banks run ChexSystems. For example, Chime will never bother about your credit score nor your banking history. If you want to avoid the soft inquiries that temporarily affect your credit score, you can opt for banks such as Chime.

You may wonder why these banks do not run your details in the ChexSystems. Well, it is one way of getting as many customers as possible. Secondly, the banks do not have any risks on your account since you must have money in your account for you to use it.

What are the factors to consider when opening a second chance checking account?

Second chance checking accounts differ in various ways. To get the best second chance checking account to help you in your daily transaction activities, you have to check on the following.

1. Opening deposit

Most second chance checking accounts need you to have a certain amount of money to deposit in your account once you successfully open your account.  The minimum deposit amounts range from $1 to several tens of dollars. The best second chance checking account should allow you to open an account for free. If there is a deposit requirement, let it be between $1-$5. Chime and Varo are some of the banks that do not require a minimum opening deposit.

2. Monthly fees

You also have to be observant to check whether a particular checking account has monthly fees or not. Most banks charge monthly maintenance fees, and if not careful, you can lose a lot of money in such programs. You may consider the bank with the lowest checking account possible. For example, BBVA’s online checking account has no monthly service charge.

3. Debit cards

Even though many banks do not issue debit cards for a second chance checking accounts, there are a few exceptions. For example, the BBVA gives free Visa® debit cards with personalized photos. In addition, debit cards allow you to access your money easily at ATM points or even pay at physical stores as well as online.

4. Daily minimums

Many banks require you to maintain a certain minimum balance, while others will never require you to do so. However, remember that you will violate the terms and conditions if you fail to maintain the required daily minimum balance. Therefore, getting a bank account with no minimum daily requirement is the best thing you can do for yourself. For example, Acorns Spend Checking Account requires no minimum daily requirement.

5. Overdrafts

It is good to get a checking account that allows you to get overdrafts when running out of money. The account is a second chance checking account, but you still require financial support in times of need. Chime can give you an overdraft without charging overdraft fees. Even Acorns Spend Checking Account has no overdraft fees.

Is a second chance bank account that important?

Since modern-day life requires us to have bank accounts for various transactions, we need to get that second chance checking account. For example, some employers require bank accounts for direct deposits and not any other kind of account. Therefore, it is crucial to have a second chance checking account.

Furthermore, no one will notice that your account is a second chance account except you and your bank. It is because second chance checking accounts have standard features such as routing and account numbers just like regular bank accounts.

Do second chance checking accounts qualify for loans?

You may not get a loan with a second chance checking account. However, some banks can give you overdrafts so that you can meet specific financial requirements. Remember that the accounts help you to improve your banking history. Therefore, since you already have a bad banking history, then banks may not trust you with their money as loans.

However, once you upgrade to regular accounts, you might qualify for specific amounts of loans depending on your credit scores.

Bottom line

A second chance checking account helps you to recover from your poor banking history. Such accounts are downgrades of the regular bank accounts. Most banks do not issue debit cards for a second chance checking account.

You should also check the various financial institutions and see issues such as minimum balances, minimum daily requirements, and overdraft fees. Sometimes you may not need a second chance checking account as you can opt for a prepaid debit card or a mobile wallet.

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