If you’ve ever applied for a savings or checking account at a new bank and been turned down, ChexSystems was likely to blame. Your ChexSystems report is basically the banking version of your credit score.
A ChexSystems report contains a record of your activity and account closures at various banks. But in the spite of the agency’s importance, many people have never heard of ChexSystems.
This article will explain what ChexSystems is, what the agency monitors, and how long it takes to get out of ChexSystems.
ChexSystems is a consumer reporting agency that collects information about problems you’ve had with banking institutions. The agency provides services under the regulations provided by the Fair Credit Reporting Act (FCRA).
ChexSystems tracks your account activities and closures at various banks and credit unions. If you have a history of closing accounts, bouncing checks, and overdrawing your account, this information is included in your ChexSystems report.
And depending on the type of derogatory mark, this information can stay on your report for quite a while. When you apply for an account at a new bank, most banks will use your ChexSystems report to either approve or deny the request.
See also: 15 Banks That Don’t Use ChexSystems in 2020
Under the FCRA, ChexSystems can report negative transactions on your checking and savings account. If you’ve ever overdrawn your account or been sent to collections, this information will show up on your ChexSystems report.
However, the report will also show when your balances are back in good standing. Here are some of the other types of information that will be included in your ChexSystems report:
According to ChexSystems, reported information typically remains on your report for up to five years. But just like you have the right to dispute inaccurate information on your credit report, you can dispute inaccurate information on your ChexSystems report as well.
If you’ve never looked at your ChexSystems report before, you can contact the agency and request a copy of your consumer file. From there, you can dispute any inaccurate information.
ChexSystems will then conduct an investigation which should be completed within 30 days of your request. The agency will notify you of the results by mail.
Your ChexSystems Report is a record of your banking information, and banks use this report to either approve or deny new account requests. If you’ve ever applied for an account with a bank or credit union and were turned down, it’s likely because of negative items on your ChexSystems report.
The best way to maintain a good report and avoid any problems is by keeping all of your accounts in good standing. But mistakes do happen, and you have the right to request one free copy of your ChexSystems report once a year. From there, you can contact the agency to dispute any inaccurate items you find.