Most people are aware of credit reporting bureaus, which are agencies that determine a person’s credit worthiness through a numerical score between 300 and 800, (with 300 being the worst and 800 being the best). However, few are knowledgeable of ChexSystems, an organization that has the same concept as credit reporting bureaus. They do not send a score, but they do let banks know whether or not a person has handled their bank accounts well. If a person gets a bad report from ChexSystems, they will have great difficulty in trying to acquire a new checking account.

ChexSystems is a consumer reporting agency that acts as a check verification service for participating institutions. ChexSystems provides information on a how a consumer has managed deposit accounts at banks. Some of the information that is aggregated into the database includes data regarding suspicious activity is included, bounced checks, abandoned accounts that have delinquent balances, and fraudulent activities.

What can a person do to prevent getting a negative report from ChexSystems? First, they should avoid ‘floating’ checks. This is the process of writing a check when a person does not have enough funds to cover the check in their bank account. Floating used to be a way of getting by for people who live financially close, but nowadays banks clear funds instantly, so it is no longer effective.

Secondly, a person should make sure that they are fully aware of all of the fees associated with their bank account, so they know how much they need to cover should something arise. Even a minor bounce from not being able to pay bank fees could result in a negative report from ChexSystems.

Thirdly, one needs to quickly clear any discrepancies on their statement with their bank. This is because unfortunately, ChexSystems cannot make any determinations based on transactions that are legitimate and those that aren’t until they are given further information from the bank. This is why any type of unwelcome transaction, even if it’s just one or two, needs to be addressed as soon as possible.

Finally, if there are any issues with bouncing, a person needs to pay the necessary fees as soon as possible. Even if ChexSystems reports the initial bouncing, banks may be more lenient if they feel that the bouncing occurred in error.

If a person does receive a negative report from ChexSystems, they can try to clear their banking reputation by going to checking school. The name of this special program is called Get Checking. Members attend just one six-hour class that teaches them how to properly manage their debt. If they do well on the test given at the end of the class, they will be able to open a checking account at the bank associated with the program. The price of this wonderful opportunity is less than $50.

What if a person has a bad ChexSystems reputation because of actual fraud? Well, real check fraud can be hard to define. Banks may not consider bounced checks for survival fraud, especially if the amount is small. If this is the situation, a person should try to explain themselves to the bank and make the necessary payment arrangements to clear their name.

On the other hand, if thousands of dollars have been bounced through check fraud, it will be significantly harder for a person to get themselves back together. In these situations, the person needs to talk to a lawyer about what the best course of action is. They may also want to consider counseling to address why they felt the need to commit fraud in the first place. Finally, they should also still try to make payment arrangements, if they weren’t already forced to through a legal proceeding.

Of course, none of these actions can ‘guarantee’ a person will be able to get placement within Get Checking, but it at least gives them a chance.

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