A second chance account is a special type of bank account (usually a checking account) made for people who are unable to open a regular bank account.

This can happen due to financial misdeeds & mistakes involving a previous bank account. For example, you cashed fraudulent checks or you did not pay overdraft fees on your account or you did not pay bank dues and your account was closed.

Banks submit your banking history (specifically your banking misdeeds if any have been committed) to a national database handled by a company called ChexSystems. If you find your name in this list, you may be denied opening a new bank account by most banks and credit unions.

It’s also possible that your existing bank will close any open accounts right away if your name is found in the database (banks may periodically check current clients against the ChexSystems database — so this does not just apply to NEW bank accounts).

What is ChexSystems

All banks keep a record of their customer’s banking history. If a bank feels that a customer is a risky customer because of past financial misdeeds they will forward that person’s information to the dreaded ChexSystems credit agency.

Chexsystems is a credit agency that keeps tabs on all bad banking clients. If you find your name in ChexSystems, you are going to find it almost impossible to open a bank account.

The Benefit of a Second Chance Account

If you are in the unenviable position of having your name in the ChexSystems database, then your best bet for opening a bank account is to seek out a second chance account.

A second chance bank account is a special bank account for people with ChexSystems problems. Keep in mind this credit is not like bad credit card credit but rather your “banking” history, so it’s not really a ‘bad credit bank account’, but a bad banking history bank account.

A Chexsystems bank account offers everything a normal bank account offers. You have your own bank account number, a routing number, and even a debit card linked to your bank account.

You can deposit, withdraw, and transfer money from your account – all done online. Some second chance checking accounts will even allow you to cash checks – though this varies from

Some second chance checking accounts will even allow you to cash checks – though this varies from bank to bank.

The Disadvantages of a Second Chance Account

So what are the disadvantages of a second chance checking account?

With a 2nd chance bank account, you are going to have to pay more for the privilege of having such an account, usually.

These fees could be anything from higher banking fees per transaction to an annual or monthly fee. Checking privileges are also restricted – you may not be allowed to cash checks until you prove you are a good banking client.

How to Find a Second Chance Account

Some of the major banks in the US — both national and state — do offer special bank accounts for people. These are usually called Second Chance accounts, but the exact name can vary.

For a single best Second Chance Account recommendation, try applying for the BBVA Compass ClearChoice Free Checking account. BBVA has been known to give this account to people with ChexSystems problems. And even better, if your account application is rejected, they offer you their BBVA Compass Easy Checking, which is their version of a second chance account. The only downside here is that you need to be living on one of the states that have BBVA. 

Look at our list of the best second chance accounts for a somewhat current list as of 2017.

If you have problems opening an account with a major bank (they tend to outright reject people with ChexSystems problems), you may find looking at a local Credit Union a good alternative. Internet Banks, may also accept you, even if you have ChexSystems problems.