Second Chance Banking
With the recession raging, many people have found themselves in either short-term or long-term financial trouble. Unfortunately, these troubles can haunt you across many aspects of your life.
Too many people do not realize that there are ways to navigate around these financial obstacles. Be it bad checks, credit debt, or lack of health care, there are resources that will circumvent, or at least alleviate whatever is hindering you from achieving a healthier financial outlook. This article, the first in a series of posts that will assist you in progressing through these adversities, will address second chance banking.
1.) ChexSystems, TeleChex, Etc.
Writing bad checks will land you on the ChexSystems and/or TeleChex database. Being in either one of these systems will make it extremely difficult to obtain a checking or savings account from most financial institutions.
These systems are used by banks to determine whether a potential customer is too much of a risk. If a person has a former checking account that was closed with a negative balance, or has unpaid debt, their name will be reported to ChexSystems or TeleChex.
Most banks will not extend checking or savings account to people whose names are on one of these lists. Any one that has ever tried to navigate modern society without a credit card or checking account can attest to the difficulty in performing even mundane financial tasks, i.e. cashing a payroll check.
2.) Second Chance Banks
Obtaining a checking and saving account is vital if you want to budget and save your money. Keeping it in the proverbial mattress is guaranteed recipe for check-to-check living.
However, there are now viable banking alternatives for those individuals that have found themselves unable to get a bank account from one of the major banking institutions. Generally, there are two options:
A.) Branch Banks
There are banks that either do not use ChexSystems and the like, or make allowances for those that have been reported. Some only initially provide savings accounts, while others provide all of the traditional services you would expect being approved.
These banks do vary by state and the services they offer. Most provide checking accounts, savings accounts, direct deposit, paper checks, and a debit card.
B.) Online or Internet Banks
These banks are similar to branch banks except that most have no accessible physical location. While they do have account and routing numbers and provide the same services as traditional banks, you will do all of your banking online.
Although some may balk at this notion, as long as the bank has a physical address and is FDIC insured, then your money is safe. Many online banks forgo the traditional banking fees because the way they operate accounts for a small overhead.
However, many do require you to maintain small monthly balances.
C.) Pre-Paid Debit/Credit Cards
These debit cards, once funded, provide you with a debit card that either has a specified limit, or only allows you to spend as much money as you have added to the card.
You are able to use these cards as debit and credit cards, which will allow you to make purchases over the Internet or wherever debit cards are accepted. Many pre-paid care services, such as the Rush Card, also offer direct deposit and bill pay services.
For a comprehensive list of second chance banks, please click here.
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With banks working hard to circumvent new Congressional laws, finding second chance opportunities is more important than ever. Thanks for visiting our blog.
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