What is ChexSystems?
ChexSystems helps us identify account applicants who may have a history of account mishandling. In other words, people whose accounts were overdrawn and then closed by themselves or the bank. Every time a bank sends a report to ChexSystems it remains in their files for five years, unless the bank or credit union that filed the report requests that it be removed or ChexSystems is asked to remove it under the law. Only the bank or credit union can decide to delete a report. If you think that ChexSystems has the wrong information about you, you can visit their web site at www.chexhelp.com or call their Voice Response Unit at 1-800-428-9623.
ChexSystems, formerly known as Chex Systems, Inc, is an agency located in Delaware that reports to credit agencies on how customers handle their bank accounts. Essentially, when an overdraft to a bank remains unpaid, and if the bank account is closed, ChexSystems reports this information to credit agencies like Equifax, TransUnion and Experian. This can affect a person’s ability to open future bank accounts, since about 8 out of 10 banks and credit unions use ChexSystems to find information on customers. Normally, when a customer hasn’t used a bank account fraudulently, like depositing fake checks or not clearing up overdraft payments and any fines, ChexSystems doesn’t have a record or your account history. If you have a history though of writing bad checks, not paying them or having bank accounts closed due to suspected illegal activities, you may not be able to open a new savings or checking account. This is not always the case. Some banks disregard the information if the amount was
ChexSystems provides deposit account verification services to its financial institution members to aid them in identifying account applicants who may have a history of account mishandling (for example, people whose accounts were overdrawn and then closed by them or by their bank). ChexSystems is also licensed to do business as ChexSystems Collection Agency providing debt collection services to members participating in this service.
ChexSystems keeps a database of people who have a bad track record with one or more banks. Banks use ChexSystems to review your banking history. If you have a negative listing in the ChexSystems database, it can be very difficult to open a new account checking, savings, or other account often taking as long as 5 years.
