Many banking regulations put in place by the federal government are designed to protect the rights of U.S. citizens when it comes to financial transactions and money handling. Other regulations are put in place to protect the banks themselves. However, ChexSystems and other reporting agencies are not sufficiently regulated, and many obtain and disseminate wrong information on consumers. This can cause lowered credit scores and even cause you to be denied bank account access.

Without a standard bank account, it is almost impossible to use the money one earns to its fullest benefit. Turning to prepaid debit cards or second chance checking accounts can alleviate the mechanics of the problem, but both of these options come with increased fees and obstacles in the way of accessing your own money.

How to Stay Off ChexSystems

The obvious answer to this question is to do everything you can to avoid being reported to ChexSystems at all. These are the things which most commonly cause a bank to report to ChexSystems:

• Failing to pay back any bank fees in a timely manner
• Getting overdrawn repeatedly
• Not cancelling automatic payments before closing an account
• Not officially closing an account, leading to bank charges for inactivity
• Co-signing accounts with untrustworthy people
• Failing to have your name taken off a joint account in case of divorce
• Failing to report lost or stolen checks

Even if you don’t do any of these things, accidents can happen. It’s best to request a report from ChexSystems once a year to ensure your information hasn’t been confused with someone else’s.

If you have actually done something worthy of being blacklisted, paying your debts can start you down the road to ChexSystems removal. However, banks and other institutions are not required to request your removal – they only have to notify ChexSystems that a debt has been paid. Follow-up may be required to ensure ChexSystems removal.

What to do if you are on ChexSystems

If you do end up on ChexSystems, getting some help may be wise. CFS can file legal documents for you and ensure everything is properly done to help you get your information off ChexSystems. There’s never any guarantee, but in most cases, there is at least some incorrect information that can be disputed.

You can help protect yourself and your check writing privileges by managing your budget, being aware of your income and bills due, and balancing your checkbook every time you make a transaction. Don’t forget to track automatic debits, mobile transactions, and other transactions that don’t necessarily have a paper trail. It’s the little things that slip past and cause the most problems.