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Chexsystems – What It Is?

Most consumers know about the three credit reporting agencies. They know that having a good credit report with these agencies is pivotal to making big purchases, qualifying for a credit card, and in some cases, getting a job.

While Experian, Trans Union, and Equifax are well known, if you ask most people about Chexsystems, they won’t know anything about the lesser known brother to the big 3.

Have you ever wondered why you can bounce checks or have unpaid bank fees yet they don’t appear on your credit report? While it is true that you will not see these items on your credit report, they will appear on your Chexsystems report.

Your Chexsystems report is very similar to your credit reports. Banks will report mishandled checking and savings account information that is shared with all Chexsystems banks. Information will stay in your file for 5 years and you have a right to view a free copy of your report once every 12 months. Finally, you also have a right to dispute your report by contacting Chexsystems directly

If you have negative entries in your Chexsystems report, what implications does this have for you? If you go to a bank to open a checking or savings account, a bank may deny your application. The bank could also use this information in conjunction with your credit report to make judgments on making loans to you. Like credit cards, it’s important that you keep your bank accounts in good standing to avoid negative reports to Chexsystems.

If you have negative entries on your report, what should you do? The first thing to do is take care of your debts. If you have unpaid bank fees, contact your bank today. Often they will negotiate with you if you are willing to pay a lump sum. If you can’t do that, get your debt paid as quickly as possible.

Once it is paid, the bank is required to notify Chexsystems that the debt has been satisfied. That doesn’t remove the entry from your report but it does indicate that you have paid your debt. It is also important to note that the reporting bank can request an entry be removed from Chexsystems. This could be used as a bargaining tool with the bank.

Chexsystems also offers consumer education. If you go to their website, you will find articles about how to pick the right bank accounts and managing your checking or savings account to avoid mismanagement on your part. Don’t miss these informative articles.

If you have always kept your bank accounts in good standing, you most likely have nothing to worry about with your Chexsystems report. You should, however, order an annual copy to check for errors. Don’t wait until you are turned down for a bank account to discover that there are errors. Any disputes won’t be corrected overnight so order your report today.

If you have had mismanaged accounts in the past, first, pay your bank fees. Until the fees are settled, the negative entry will not be removed.

For more about chexsystems or to learn about non chexsystem banks visit us.