What Is ChexSystems?

Last Updated: October 24, 2017 in Banking • 

ChexSystems is a consumer credit reporting agency used by banks and credit unions to find out the financial history of people applying for checking and savings accounts. It is governed by the federal Fair Credit Reporting Act (FCRA) and other laws. Roughly 80% of the banks and credit unions in America use ChexSystems to acquire information on customers who have defaulted on overdrafts and other payments.

When someone goes to a bank or credit union and fills in an application for a checking account, the bank may request a ChexSystems report on the individual. If there is a report available, it usually means you have had an account closed for one reason or another in the past. The bank will then base a decision on whether to allow you to open an account or not. ChexSystems do not make this recommendation for the bank; they are rather more like the messenger who bears good or bad news. Banks have different policies on how they deal with ChexSystems.

A ChexSystems report may include details on the following:

  • Failure to settle debts
  • Unpaid overdraft fees
  • Depositing counterfeit bills or forged checks
  • Writing bouncing checks

Once your bank reports you to ChexSystems your name stays on their files for a period of up to 5 years. In this time it may prove very difficult indeed to open a new checking or savings account. Making sure you service your account and keep up to date with any overdraft payments is very important as it is not an easy exercise to have your name removed from the ChexSystems.

ChexSystems Removal Guide - Free Download

Our comprehensive (and free) ChexSystems Removal Guide includes the exact documents and easy-to-follow instructions that will help you to get off ChexSystems so you can start banking again.

ChexSystems Quick Facts

  • ChexSystems is a credit reporting agency that is used by banks and other financial institutions to help measure the amount of risk that a new customer poses to their business.
  • If, for whatever reason, your name has been reported to ChexSystems as a risk you will have a difficult, if not impossible, time opening any type of banking account.
  • If you are reported to ChexSystems you will stay on their database a minimum of 5 years.
  • Practically every single one of the financial institutions in the United States use ChexSystems to check out potential customers before allowing them to have any type of account.
  • ChexSystems does not profit in any way by reporting your negative information. Negative or positive it doesn’t affect them either way.
  • ChexSystems cannot be used to open, close or otherwise perform any banking actions. They are simple a credit reporting agency like Equifax, Experian and TransUnion.
  • If you have filed BANKRUPTCY you will need copies of the discharge documents from the bankruptcy court.
  • If identity theft is the reason you are on ChexSystems you will need to give ChexSystems a certified copy of either your police report or an affidavit of fraud.

Some Banks & Credit Unions Don’t Use ChexSystems

Finding yourself in the ChexSystems database can be deeply troubling. You may worry that you will never again be able to open a normal bank account, making even the simplest of financial transactions difficult or impossible to complete.

Thankfully, there are several banks and credit unions that don't use ChexSystems, enabling you to get back on your financial feet with a real bank account. Better yet, many of these accounts offer premier-level services and few restrictions and fees.

How To Get Out Of ChexSystems

If you’re wondering how to get out of ChexSystems then you’ve come to the right place. Our free ChexSystems Removal Guide includes the exact documents and easy-to-follow instructions that will help you to get off ChexSystems so you can start banking again.