ChexSystems, it’s like a credit report for your checking history

December 11, 2009  |   Posted in Credit Education, Credit Guy Blog, blog   |   0 Comments   Tags: banks, checking, ChexSystems

I write a lot in this blog about credit reports and credit cards, but I haven’t written about something that’s just as important as a clean credit report before—a clean ChexSystems report.  ChexSystems is a consumer reporting agency, just like the credit bureaus, that tracks your deposit accounts, like checking and savings, with banks.  A ChexSystems report is to your checking history as a credit report is to your credit history.  They track all negative deposit account activity such as overdrafts, negative balances, and fraud for the past 5 years, as well as mundane activities like account freezes, checks that haven’t been cashed, and check orders.  So just like a bank will pull a credit report to see how you have done in the past managing other loans, they’ll pull your ChexSystems report before allowing you to open a checking account to make sure you don’t have a history of writing bad checks or committing fraud.  Banks take negative ChexSystems reports extremely seriously and will typically reject an applicant if they have even one negative mark on their report.  This creates a snowball effect—no checking account means you won’t be able to open most credit accounts, secure an auto loan, qualify for a mortgage, etc.

The good news is ChexSystems is regulated by the FCRA, the Fair Credit Reporting Act, just like the credit bureaus are.  That means a bad ChexSystems report can be fixed.  ChexSystems allows a consumer to get a free report from them annually or after a consumer has been denied an account.  If you’d like to get a copy of yours, you can click here to order one directly from ChexSystems.  Just like a credit report, if you find items on your report that are inaccurate you can request that they be investigated.

Feel free to give us a call if you need help getting your ChexSystems file straightened out, we have extensive experience with them just like we do with the credit bureaus.  We can also put you in contact with several banks that we have relationships if you’re having trouble getting an account.