The Top 10 Second Chance Banks

The Top 10 Second Chance Banks
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Author : Chris Morgan
Updated on : January 14th, 2022

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Are you having trouble getting approved for a new bank account? If traditional banks are repeatedly turning you away, this is likely due to your past banking history, which is contained in your ChexSystems report.

Most banks in the country look up your ChexSystems history when you apply for a checking account, which is why having a poor record can make it very difficult to get approved. In fact, this can help explain why 5.4% of U.S. households (7.1 million) were without a bank account in 2019, according to the Federal Deposit Insurance Corporation (FDIC).

What can you do if you find yourself in this situation? In order to get yourself a bank account as soon as possible, consider second chance banking. Second chance banks are more willing to forgive past banking mistakes, which is why they often have higher acceptance rates.

There are more banks out there that offer second chance banking than you might think. In order to focus your search on only the best options, this article will introduce the top 10 second chance banks in the nation. Hopefully, you’ll be able to open a bank account with one of these and start rebuilding your banking history.


Top 10 Banks For Second Chance Banking

Here are our top 10 second chance banks and credit unions. All of these banks have a website where you can conveniently fill out an application for their bank accounts in minutes.

CIT Bank


CIT Bank Logo

CIT Bank was founded in 2000 in California. It’s currently operated under financial services company CIT Group, which is a subsidiary of First Citizens Bank. They have 600 physical branches in over 22 states, but anyone living in the US can apply for the CIT Bank Savings Connect, which is our top recommendation.

While CIT Bank may check your ChexSystems record when you apply, they are often willing to offer you a second chance at banking with them. Here are some of the main reasons we like CIT Bank:

  • Free to open and use. It’s hard to find a second chance bank account that doesn’t have any fees, but the Savings Connect is a rare exception. There are absolutely no setup fees and no monthly service fees associated with the account. Simply open a Savings Connect account with a linked eChecking account and you’re good to go.
  • No ATM fees. You can access funds from your Savings Connect with your eChecking debit card. As long as you use an ATM within CIT Bank’s network, they’ll charge no fees. If you happen to use an out-of-network ATM, CIT Bank will reimburse you $30 per month in these fees.
  • High interest yield. The biggest selling point of Savings Connect is the high interest yield you can earn on your savings. By default, you’ll earn 0.42% APY on your funds, which is already a rate that’s multiple times the national average. However, if you make a monthly deposit of $200, you’ll earn the upper tier rate of 0.50% APY!

All of these features make applying for Savings Connect a no-brainer, especially if you’re in need of a savings account.

Chime®


Chime Logo

Chime’s mission is to make banking helpful, easy, and free for everyone. As a result, they do not run your credit or check your ChexSystems report when you apply to any of their checking and savings accounts.

Chime is technically not a bank. Instead, they are a relatively new financial technology company that offers banking services provided through The Bancorp Bank, N.A. and Stride Bank, N.A., meaning that their products are still FDIC insured. Here’s why you should consider their Chime Checking accounts and Chime Savings accounts.

  • No fees1. Both the Chime Checking and the Chime Savings have no monthly service fees and no minimum balance requirements. You are also eligible for fee-free overdraft up to $200 with their SpotMe® feature2.
  • Round up your savings. Chime Spending and Chime Savings are designed to be used in conjunction with each other. You can round up all your transactions to the nearest dollar and deposit the difference into your Chime Savings account. If you want a surefire way to build up your savings over time, this is a great way to do so.
  • High interest yield3. Chime Savings currently comes with a high interest yield of 2.00% APY*. This is multiple times the national average of all savings accounts4.

BBVA (PNC Bank)


PNC logo

BBVA, which recently became a part of PNC Bank, offers a variety of second chance products that you should definitely take advantage of. We like their wealth of experience: PNC Bank was first established in 1983, and is currently the 7th largest bank in the country.

We highly recommend applying for PNC Bank’s VirtualWallet, which is essentially a checking account and savings account bundled into one. The Spend checking account is great for handling daily expenses and for setting up direct deposit. The Growth savings account is a safe and secure place to store your long-term savings.

VirtualWallet comes with a variety of features that make managing your money easy. For example, you can set up recurring payments for things like rent, utilities, and subscriptions. Then, you can use the Money Bar feature to give you an overview of how much money is allocated to these recurring bills, and how much you have free to spend.

SoFi


SoFi Logo

SoFi Money is a cash management account that has a relatively high acceptance rate, and is a great option for those needing a second chance bank account. SoFi self-advertises SoFi Money as an account that’s “helpful to anyone with dollars to manage.”

Among its numerous benefits, SoFi Money is entirely free of monthly fees. With your free SoFi debit card, you’ll gain access to over 55,000 ATMs nationwide. If you’re able to receive over $1,000 a month in direct deposits, you’ll also get free overdraft protection for up to $50. 

SoFi Money can also help you earn a little bit of interest on top of your funds. All accounts earn a 0.01% interest rate, but if you can deposit $500 into your account per month, you’ll earn 0.25% APY on your money.

GO2bank


GO2bank Logo

GO2bank is trusted by over 33 million customers nationwide. Their main banking product is a second chance account: a modern, essential checking account that offers everything you’d need for everyday banking.

With GO2bank, you won’t have to worry about hidden fees. The account also has no monthly fees, as long as you receive payroll or government benefits through direct deposit in the previous month ($5 monthly fee otherwise). You could also potentially get your pay up to 2 days early.

Signing up for GO2bank also opens up many of their other products. One example is the GO2bank Secured Visa Credit Card, which can help you repair your credit score as it reports to all 3 credit bureaus. GO2bank will not run your credit when you apply, and there’s no annual fee on the card.

GTE Financial


GTE Financial Logo

GTE Financial is one of the largest and most well-known credit unions in the country. Their Go Further Checking is a second chance bank account with simple approval qualifications.

Go Further has a $9.95 monthly fee. However, you can waive the monthly fee by enrolling in eStatements, making $500 in monthly deposits, and making 15 monthly transactions. Definitely strive to achieve all three of these every month, as this can also help you build good checking account habits.

The great thing about Go Further is that you can upgrade to a regular checking account after 12 months. As long as your account is in good standing, GTE Financial will upgrade you to Go Full Access or Go Premium.

Wells Fargo


Wells Fargo Logo

Wells Fargo is the third largest bank in the US. They are well-known for checking your ChexSystems history when you apply for a checking account. However, you’ll have an easier time applying for Wells Fargo’s Clear Access Banking, which is a second chance checking account.

Clear Access Banking requires a $25 minimum opening deposit to get started. There is also a $5 monthly fee that can’t be waived, unless you’re between 13 to 24 years old. This checking account comes with standard banking features, such as online banking, direct deposit, and online bill pay.

Varo


Varo Logo

Varo focuses on online banking, as it is an all-digital bank that’s available to anyone in the US. Varo offers second chance banking that doesn’t check your past ChexSystems history or your credit score.

A Varo Bank Account has no monthly fees and no minimum balance requirements. You’ll also get a free debit card, direct deposit, and access to over 55,000 ATMs nationwide. We also recommend looking into Varo Savings, which has a high interest yield and tools to help you build better savings habits.

Woodforest National Bank


Woodforest National Bank Logo

Chime is a financial technology company headquartered in San Francisco. Their mission is to help make banking helpful, easy, and free for all. As a result, many consider their main banking products as second chance accounts for those who’ve had past banking hiccups.

While Chime is a relatively new player in the online banking world, their bank accounts are redefining the space. Here’s why you can’t go wrong with either Chime Spending (their checking account) or Chime Savings (their savings account):

Peoples Cash Solutions


Peoples Cash Solutions Logo

Peoples Cash Solutions is known for their Second Chance Checking account, designed to give you a fresh start to banking. This checking account is FDIC insured and comes with all the standard banking features you’d need.

This bank account includes a free Mastercard debit card, a personal checkbook, online bill pay, as well as direct deposit. The account requires $30 to get started, and a relatively low monthly fee of $4.95.


What is a Second Chance Bank?

Most banks in the United States have a set of criteria that they look at before approving you for a bank account. One of these criteria is that you have a relatively clean banking history.

Second chance banks also look at your banking history when you apply, but tend to be more lenient with their requirements. To fully understand this, we need to have a baseline understanding of ChexSystems.

What is ChexSystems?

ChexSystems is a consumer reporting agency that collects and distributes information about your past bank accounts. It’s important to note that ChexSystems only records negative items on your report, which includes the following:

  • Overdrafting
  • Bounced checks
  • Involuntary account closures (and outstanding balances)
  • Account fraud or abuse

Depending on the severity of each item, ChexSystems generates a score for each consumer. Similar to how credit scores work, your ChexSystems score can range from 100 to 899, where a higher score is better.

How Does ChexSystems Work?

Approximately 80% of all banks use ChexSystems. This means that they both report and receive information about your banking history. When you apply for a new bank account, chances are, that bank is pulling your ChexSystems score.

Most banks have a minimum ChexSystems score threshold that they use to quickly approve or reject applicants. Unfortunately, this means that if your past record isn’t good enough at one bank that uses ChexSystems, you’ll likely get rejected at another bank as well.

How Do I Get Around ChexSystems?

If you’re constantly getting rejected by banks due to ChexSystems, you have two main options:

  • Dispute ChexSystems errors. The Fair Credit Reporting Act states that you can request a copy of your ChexSystems report once per year. If you find any errors in your report, you can dispute them directly with ChexSystems. Another option is to look at your outstanding debts and see whether you can pay them off, and then have ChexSystems remove the negative mark.
  • Apply for a second chance banking account. Instead of going through the trouble of disputing items on your report, you can simply apply for one of the 10 second chance banks and credit unions we provided in this article. As we’ve mentioned previously, these banks offer higher approval rates for their checking accounts, since they’re willing to offer you a second chance at banking.

Why Should I Apply For Second Chance Banking?

To some, it may seem like a hassle to apply for a checking account. There may be a minimum deposit amount that you need, or a bunch of other requirements you need to hit to avoid paying a monthly fee on your account. You might be wondering whether it’s worth the trouble and cost.

The answer is yes. Historically, it’s been proven that it’s always better to have a bank account than be without one. According to Bank on Atlanta, not having a bank account can cost you up to $40,000 over a lifetime due to the use of costly alternatives, such as a prepaid debit card.

A checking account or savings account provides a number of great benefits, including:

  • A safe place to store your money. You’ll want to have your funds FDIC insured at a bank so that even if something happens, your money is safe. This is definitely preferable to keeping your money stored in cash, stored in a safe or underneath your mattress.
  • Easier payments. All the second chance banking accounts we recommended come with a debit card, which is all you need to make payments.
  • Overall convenience. Having a bank account makes it easier to do many things, such as receive your paycheck via direct deposit. You can also set up automatic payments for things like rent and utilities so they’re never past due.

What Should I Look For in a Second Chance Banking Account?

Each second chance account has slightly different features. When considering different bank accounts, here are the main things we suggest looking out for:

  • FDIC insurance. In the unlikely event that your bank goes bankrupt, you’ll want to make sure your funds are still FDIC insured.
  • A debit card. Always make sure your bank account comes with a free debit card! This allows for more convenient payments, as well as ATM access.
  • Low or no monthly fees. Second chance accounts usually come with some fees, but try to avoid paying more than $10 per month for them, unless the features are worth it. Also, pay attention to any criteria that you can satisfy to waive monthly fees.
  • Overdraft protection. Sometimes, accidents happen and you can overdraft on your account. In these cases, it’s always nice to have some sort of overdraft protection.

Some accounts on our list, such as the CIT Bank Savings Connect, also come with a high interest yield. This can be considered an important bonus factor.


What Is The Difference Between Non-ChexSystems Banks and Second Chance Banking?

There is a small but important distinction to be made between non-ChexSystems banks and second chance banks. As the name suggests, non-ChexSystems banks are banks that don’t use ChexSystems at all in their approval process. 


In contrast, second chance banks may still use ChexSystems, but are simply more willing to forgive your past mistakes. It’s also possible for a second chance bank to not use ChexSystems: Varo Bank is one such example.


Frequently Asked Questions About Second Chance Banking

Let’s dive into some of the most frequently asked questions about second chance banking.

What Do I Need to Apply For a Second Chance Bank Account?

To apply for a second chance bank account, you’ll usually just need to provide your personal information (including your social security number to verify your identity).

Do Second Chance Accounts Require an Initial Deposit?

Most checking accounts will require some amount of an initial deposit. A reasonable range is somewhere between $25 to $100. Chime is the only company on our list that doesn’t require an initial deposit.

What Fees Can I Expect For a Second Chance Bank Account?

There are a couple main areas where banks like to charge fees:

  • Monthly service fee. A base monthly fee for having the account open.
  • Overdraft fees. Extra penalty fees for overdrawing your funds.
  • Low balance fee. Some banks have a minimum balance requirement. They’ll charge you a fee if your balance drops below that number.
  • ATM fees. You might be charged at ATMs, particularly if you use an ATM that’s outside of your bank’s network.

The best accounts, such as the CIT Bank Savings Connect, will not charge any of these fees. Many banks will also waive checking account fees if you set up direct deposit.

Are Second Chance Accounts Available in All 50 States?

Yes, all of the bank accounts on our list are available in all 50 states, with the exception of Woodforest Bank (only offered in 17). If you live in one of the states below, we have articles dedicated to sharing additional local recommendations for second chance checking accounts.

Can You Be Denied For a Second Chance Bank Account?

The banks and credit unions on our list have very high acceptance rates for their checking accounts, so it’s unlikely that you’ll get rejected. Still, there is a small chance that you could be denied.

If this happens, we recommend simply trying another bank on the list. With 10 options, you’re almost guaranteed to be approved for at least one of these bank accounts.


Conclusion and Next Steps

Second chance banking is the perfect option for those who have struggled with banking in the past. In this article, we’ve shared our top 10 banks and credit unions that we know can help you repair your banking history.

To begin reaping the benefits of second chance banking, we recommend looking into the CIT Bank Savings Connect. This is a bank account that comes equipped with everything you need in a modern savings account, along with a high interest rate that will help compound your savings for years to come. There’s no reason not to apply today!

Our Top Pick for Banks that Don't Use ChexSystems is CIT Bank.

CIT Bank Logo

When doing research, Credit Help Info relies on credible and authoritative sites. These research sources are provided so that you can see exactly where we get our information.

Disclosures:

Chime is a financial technology company, not a bank. Banking services provided by The Bancorp Bank, N.A. or Stride Bank, N.A., Members FDIC.

1. There’s no fee for the Chime Savings Account. Cash withdrawal and Third-party fees may apply to Chime Checking Accounts. You must have a Chime Checking Account to open a Account.

2. Chime SpotMe is an optional service that requires a single deposit of $200 or more in qualifying direct deposits to the Chime Checking Account each month. All qualifying members w overdraw their account up to $20 on debit card purchases and cash withdrawals initially, but may be later eligible for a higher limit of up to $200 or more based on member's Chime Ac deposit frequency and amount, spending activity and other risk-based factors. Your limit will be displayed to you within the Chime mobile app. You will receive notice of any changes to may change at any time, at Chime's discretion. Although there are no overdraft fees, there may be out-of-network or third party fees associated with ATM transactions. SpotMe won't c transactions, including ACH transfers, Pay Anyone transfers, or Chime Checkbook transactions. See Terms and Conditions.

3. Chime Checking Account is required to be eligible for a Savings Account.

* The Annual Percentage Yield (“APY”) for the Chime Savings Account is variable and may change at any time. The disclosed APY is effective as of October 25, 2022. No minimum have $0.01 in savings to earn interest.

4. The average national savings account interest rate of 0.17% is determined by FDIC as of September 19, 2022 based on a simple average of rates paid (uses annual percentage yiel depository institutions and branches for which data are available. Visit National Rates and Rate Caps to learn more.


About the Author

Chris Morgan

Chris Morgan is a credit expert and founder of Credit Help Info. He has been featured in Addition Financial, GOBankingRates, MSN Money, Yahoo Finance, and many other publications. He has read hundreds of books and resources on finance and the credit industry. Because he did this, you don’t have to. As a school teacher for over 20 years, Chris enjoys taking complicated material and breaking it down into manageable information that’s easy to understand.


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