A bank account is a critical tool for managing your finances. However, you might have trouble opening an account if you’ve made some financial mistakes. Luckily, second chance bank accounts offer a lifeline.
If you were turned down for a checking account, getting a second chance account might be the right solution. Here’s what you need to know about this option and which accounts are worth considering
What Are Second Chance Bank Accounts?
When it comes to managing a checking account, it’s easy to make mistakes. Some common missteps include too many overdrafts, bounced checks, and negative account balances.
If you have previous problems with accounts, some institutions won’t let you open a new checking account since you will show up in ChexSystems. This reporting agency gathers information about deposit accounts you hold with banks.
Fortunately, many financial institutions offer second chance checking accounts to people with past issues. Most banks require a monthly fee to maintain this type of account, which might be waived if you hit minimum balance requirements.
Even if you have to pay a fee, you’ll be able to streamline your money management. After all, most of us use checking accounts to manage monthly bills and receive cash regularly.
When you open your account, you can rebuild your banking history. If you can avoid overdrawing your account, your bank may allow you to transition to a regular checking account.
What are the Best Second Chance Bank Accounts of 2023?
Getting back on your feet is essential to managing your finances. Part of that includes being able to have a checking account. Thankfully, there are financial institutions that don’t use ChexSystems, which allows you to open an account.
Here are the top second chance bank accounts to manage your money.
1. Go2Bank
Go2Bank is a neobank spearheaded by Green Dot. This platform focuses on providing a mobile banking experience. With that, you’ll find a highly-rated mobile app to manage your Go2Bank account.
The online-only bank doesn’t require a solid banking history or good credit score to open an account.
Where Go2Bank Shines
Go2Bank offers significant overdraft protection and access to an extensive network of fee-free ATMs.
- Number of in-network ATMs: 40,000+
- Overdraft protection: Up to $200
- Direct deposit: Available
- Cash deposits: Available at over 90,000 partner retail locations
Go2Bank Costs
Here’s a breakdown of the costs associated with Go2Bank:
- Monthly fees: $5, waived if you set up eligible direct deposit
- Debit card: Free
- Out-of-network ATM fee: $3
- Foreign transaction fees: Three percent of the transaction amount
If you are willing to link your direct deposit to this online checking account, you can avoid the $5 monthly fee.
Since there are free options out there, Go2Bank might not be the right fit for people who don’t have an eligible direct deposit they can link to their account.
Read our guide on apps like Chime to find a suitable alternative without the fees.
2. Varo
Varo is a robust platform that offers online banking options, including a checking account. The company won’t need to look at your credit report or ChexSystems report to approve your account.
Where Varo Shines
When you use your Varo debit card, you can earn up to six percent cash back. Each time you reach $5 in cash back, the funds are automatically transferred to your bank account.
As everyone on a budget knows, a little bit of cash back can go a long way.
- Number of in-network ATMs: 55,000+
- Overdraft protection: Varo will only let you spend what you have on hand.
- Cash advances: Borrow up to $100 without interest
- Direct deposit: Available
- Cash deposits: Available at over 90,000 partner retail locations
Varo Costs
Here’s a breakdown of Varo’s costs:
- Monthly fees: $0
- Debit card: Free
- Out-of-network ATM fee: $2.50
- Foreign transaction fees: $0
Varo is an affordable option for anyone who needs to get their finances back on track. The platform makes it easy to avoid overspending on bank fees.
3. Wells Fargo Clear Access Banking
Wells Fargo Clear Access Banking can be a good choice if you prefer to work with a reputable bank. Although Wells Fargo looks at ChexSystems, it offers a checking account for people with bad ChexSystems reports.
Additionally, people with poor credit can sign up for this account.
Unlike most of the other options on this list, you’ll need at least $25 to open a Clear Access bank account.
Where Wells Fargo Shines
With this account, you’ll have access to many physical branches nationwide. Consequently, if you are looking for an in-person banking option, Wells Fargo might be the right fit.
- Number of in-network ATMs: 12,000+
- Overdraft protection: This account will only let you spend what you have on hand.
- Direct deposit: Available
- Cash deposits: Available at thousands of physical locations
Wells Fargo Costs
Here’s a breakdown of this account’s costs:
- Monthly fees: $5, waivable
- Debit card: Free
- Out-of-network ATM fee: $2.50
- Foreign transaction fees: Three percent of the transaction amount
You can avoid the $5 monthly fee if you are between the age of 13 and 24. However, you won’t be able to avoid some common bank fees, including foreign transaction fees.
4. GTE Financial Go Further Checking
GTE Financial is a Tampa-based credit union. As of 2023, the organization has over 250,000 members. Its Go Further Checking provides a solution for those with bad marks on their banking history.
The credit union offers over a dozen physical locations in Florida. Fortunately, you don’t need to live in the area to work with GTE Financial since you can manage your account online.
Where GTE Financial Shines
GTE Financial has a process in place to help you upgrade to a regular checking account. If you maintain good banking habits for 12 months, the credit union will automatically upgrade your account.
You cannot have more than two non-sufficient funds fees, overdraw your account, have a negative balance for three days, or have any returned checks during this time to receive your account upgrade.
The upgraded account means lower monthly fees.
- Number of in-network ATMs: 30,000+
- Overdraft protection: $8
- Direct deposit: Available
- Cash deposits: Available in 23 locations in Florida
GTE Financial Costs
Here’s a breakdown of the costs associated with this account:
- Monthly fees: $9.95, waivable
- Debit card: Free
- Out-of-network ATM fee: $3
- Foreign transaction fees: One percent of the transaction amount
You can avoid the monthly fee by enrolling in eStatements, making at least $500 in deposits each month, and making at least 15 monthly debit card transactions.
5. Chime
Chime isn’t a bank. Instead, it’s a fintech company that works with FDIC-insured banks to offer banking services, including an online-only checking account.
As a neobank, you can expect no monthly, overdraft, or maintenance fees, and minimum account requirements when you bank through Chime.
Plus, the company doesn’t require a ChexSystems report or a credit check to get started. This makes Chime an excellent option if you want to open a checking account without going through ChexSystems.
Where Chime Shines
Chime offers an online-only experience. If you are comfortable managing your finances online, this neobank might be a good choice.
- Number of in-network ATMs: 60,000+
- Fee-Free Overdraft: With Chime’s SpotMe, you can get fee-free overdraft protection for up to $200
- Direct deposit: Available
- Cash deposits: Available at over 90,000 partner retail locations
In addition to Chime’s SpotMe protection and ample access to ATMs, few and minimal fees are a big benefit of using Chime.
This is similar to Spruce from H&R Block. Read our Spruce Money review to learn more.
Nevertheless, you’ll want to keep in mind that you have a daily spending limit of $2,500 with Chime, though limits are subject to change and members will be notified if they do.
Chime Costs
Before signing up, it’s important to understand the fees of any account. Here’s a breakdown of the costs associated with Chime:
- Monthly fees: $0
- Foreign transaction fees: $0
- Debit card: Free
- Out-of-network ATM fee: $2.50
- Cash deposit fees: $0 at Walgreens, varies at other partner retail locations
Basically, Chime only has one fee for when you use an out-of-network ATM, or if you deposit cash into your account at a partner retail location other than Walgreens. This means that even if you haven’t been denied by a bank, you might find Chime full of valuable features.
Read our Chime review to learn more.
FAQs About Second Chance Bank Accounts
Rebuilding your banking history is a vital part of becoming financially stable. Here are some common questions about second chance accounts.
Can you be denied a second chance bank account?
Second chance bank accounts are designed for people with a problematic banking history. Even if you have previous issues recorded on your banking record, you are unlikely to be denied an account.
However, it’s possible to be denied for other reasons, such as not having the minimum deposit requirement on hand.
Ultimately, the financial institution can deny your bank account application. But, a denial is unlikely in most situations.
Can I open a bank account if I’m in ChexSystems?
ChexSystems keeps track of your banking history. If you have negative information, including bounced checks or unpaid fees, these might show up in your ChexSystems report.
Financial institutions may deny your bank account application if you have negative information on your ChexSystems report. However, some banks offer accounts designed for customers with red flags in the ChexSystems report.
If you are in ChexSystems, second chance bank accounts offer a way to start afresh.
How long does it take ChexSystems to clear?
In general, the ChexSystems report holds onto information for five years. After the five-year mark, the negative information will fall off your ChexSystems report.
However, under the Fair Credit Reporting Act, some information can stay on your report for seven years.
You cannot push the information off of your ChexSystems faster. But, through responsible management of your new account, you can prove your reliability to banks or credit unions.
For example, avoiding overdrafts and bounced checks for a certain amount of time could result in an upgrade to a traditional bank account.
Bottom Line
Second chance bank accounts offer a way for those with past banking problems to access the financial services they need. As you manage your money with this new account, you can rebuild your banking history.
Beyond helping you build a good banking profile, these accounts can help you create financial stability with useful money management tools like direct deposit and online bill pay.
A checking account is necessary in our digital world. Fortunately, opportunities are available to manage your finances wisely.
What’s one area of your finances you would like to improve this year?
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