Previous | The Secret To Avoiding Secret Shopper Scams Next | How to save money at the grocery store
June 25, 2020 / Sarah Stansfield
Turned down for a bank account? This could be why

Turned down for a bank account? This could be why

By Sarah Stansfield, community office manager at F&M Trust’s Mont Alto office

If you have a history of overdrafts or, worse, if another financial institution closed your account, you’re probably going to run into some difficulties when you try to open another one. That’s because the financial institution that closed your account most likely reported you to ChexSystems, a national consumer reporting agency that provides information about the use of deposit accounts by consumers. Basically, the company keeps a record of individuals who have mismanaged their bank accounts.

file folder with the word deniedWhen you apply for a new bank account, most financial institutions check your banking history before approving your application. They want to see if you have a history of misusing your accounts — for example, bouncing checks or not paying fees. Mismanaging your checking account by bouncing checks can affect any financial applications. If they reject your application, that most likely means that they found negative information in your banking history, as reported by ChexSystems.

Here’s some of the information included in a ChexSystems report:

  • Personal information, such as social security number, names, date of birth, addresses, phone numbers and email addresses
  • Suspected fraudulent activity or identity theft
  • Returned checks reported by retailers
  • Involuntary account closure
  • Overdrafts or bounced checks
  • Unpaid negative balances or fees

ChexSystems retains a record of reported information for five years from the report date, unless the financial institution that reported the information requests its removal. A ChexSystems record does not affect your credit score.

If you’ve been denied a standard account, take heart: This is not the end of the road. You have other options, one of which includes a second-chance checking account, which can help you rebuild your banking account history. The fees associated with a second-chance account are generally higher than standard account fees, but using this account responsibly can get you back on track. If you can demonstrate your ability to properly manage your checking account for six months to a year, you may be able to graduate to a standard checking account.

You can request a free copy of your consumer disclosure report from ChexSystems here.

Recent Articles
How to save money at the grocery store
How to save money at the grocery store

How to save money at the grocery store

June 19, 2024 / Lisa Hogue

Turning your hobby into a source of income
Turning your hobby into a source of income

Turning your hobby into a source of income

June 12, 2024 / Kia Treml

Is it time to sell your home?
Is it time to sell your home?

Is it time to sell your home?

June 05, 2024 / Katie Rittel

Seven tips to help you save for vacation
Seven tips to help you save for vacation

Seven tips to help you save for vacation

May 17, 2024 / Megan Witmer

Gig economy offers workers independence
Gig economy offers workers independence

Gig economy offers workers independence

May 14, 2024 / Shelby Yinger

Budgeting for home improvements
Budgeting for home improvements

Budgeting for home improvements

May 09, 2024 / Jenny Madden

What to know when starting a small business
What to know when starting a small business

What to know when starting a small business

May 06, 2024 / Natasha Koons

Tips for first-time credit card holders
Tips for first-time credit card holders

Tips for first-time credit card holders

April 23, 2024 / Chastity Wantz

What information do I need for my mortgage application?
What information do I need for my mortgage application?

What information do I need for my mortgage application?

April 17, 2024 / Mary Wright

Join our e-newsletter

Sign up for our e-newsletter to get new content each month.

NOTICE: YOU ARE LEAVING F&M TRUST!

You are now leaving the F&M Trust website. Links to third-party sites are provided for your convenience. Such sites are not within our control and may not follow the same privacy, security or accessibility standards as ours. F&M Trust neither endorses nor guarantees offerings of the third-party providers, nor is F&M Trust responsible for the security, content or availability of third-party sites, their partners or advertisers.