how Chexsystem works

Dear AJ,

Chexsystems acts as a credit rating agency of consumers and verifies consumer????????s checking activity. Credit unions as well as banks go through this report whenever you go to them to open a new deposit account. Thus, if your name is in Chexsystem then you may face problem while opening a new deposit account with a bank or credit union.

Quote:

Any negative entry on your checking account will get reflected in your chexsystem report. Chexsystem works like the credit bureaus. As credit reporting bureaus keep an account of your loan repayment behaviour, the chexsystem maintain a track of your checking account.

Any negative entry on your report will remain for five years and will get eliminated form the report automatically after the time lapses. However, if you have a negative entry in your report, it????????ll make it almost impossible to open a new account with another bank.

If the bank is linked with chexsystem, it????????ll check you banking behaviour before offering you a new checking account. Hence it????????d be wise to search for a bank or credit union, who is not listed with the chexsystem if you wan to avoid the chexsystem check.

Thanks for your info.

But - if I have an active, open account in good standing - I can still write checks through that account at locations, correct?
I am never one to bounce checks, etc...this all circles back to closing an account due to payday loans.

yes you should still be able to write checks anywhere. SCAN and Chexsystems reports are not the same, just the same company owns them.

If none of the checks were returned then you should be okay if the only thing you owe is to the bank. Remember though, some banks will close accounts in good standing if they find out that you are reported to chexsystems. Some make random checks to see if you are reported and ordering checks with a Deluxe company can alert them as well

So what is SCAN?

I have heard WAMU makes random checks and I do bank with them. But, I am in good standing. What is a deluxe company for ordering checks?

For information on SCAN go to

https://www.consumerdebit.com/consumerinfo/us/en/scan/index.htm


Here is the information about ordering checks


Did you know that when you order checks from Deluxe or one of their
subsidaries, that they send personal information to Chexsystems and to
Deluxe's collection agencies? They send your acount number, address,
phone number, and more. Do not order checks through Deluxe, Current
Checks, Designer Checks, or Checks Unlimited. They also send
information to other companies such as Debit Bureau, EFunds, and
SCAN.

The Style check company seems okay and it does state that they keep
all information confidential. Just always make sure that it isn't
owned by Chex. They also keep information on file such as your account
number, check numbers etc. Be Careful is all I am saying because there
have been people who ordered checks and then chexsystems contacts
thier bank realizing they have an account to let them know they are on
chexsystems. Some situations where accounts were closed just from
ordering checks.


Suggestions: Style Checks , Walmart, Identity, Checkworks, Checks in the Mail, the check gallery

SCAN stands for Shared Check Authorization Network and is provided by Deposit Payment Protection Services, Inc. It is an information database that helps its subscribers, members and retailers in making proper decisions regarding check acceptance or opening of an account. It helps its members in the following manner: -
??????? Reduce losses due to returned checks
??????? Customer service improvement
??????? Safeguarding against theft/fraud of identity
SCAN is only a database and thus the decisions regarding acceptance of check or account opening is not done by it. Members of SCAN take these decisions.

At the same time, SCAN is not a credit bureau but a Consumer Reporting Agency. It is governed by FCRA (Fair Credit Reporting Act). Any information reported in its database remains there for a period of 7 years.

Dear Aj,

Let me give you a sample report of SCAN and will help you to understand it in a better way:-



You will find all the answers of your queries regarding SCAN in https://www.consumerdebit.com/consumerinfo/us/en/scan/faqs.htm .


If you want to know more on SCAN then you can also start a new forum thread on the same where our members can help you more.

Thanks & Regards,
Phoenix

Nicely done, Phoenix.

Thanks Unclewulf for your appreciation. :-D:-D:-D

Just a persoanl note... I had wrong infomation on my chexsystem report and I sent them absolute proof and about 2 weeks later I got another report from them and the wrong infomation was removed.

It is VERY important to keep accurate and all records of almost everything if you are in debt are dealing with a CA. If I can help in anyway, I am here for you.

Luke

Wow - thanks for the info! I was just wondering if it would hurt me on my new account....which has no negatives.

Dear Aj,

As per I know, entry in Chexsystem will trouble you to open any new account with a bank or credit union. I don????????t think it has any negative effect on your existing account.

If you have already opened a new account with a bank/credit union despite having your name in Chexsystems then it is evident that it is not verifying with the Chexsystems before opening an account. Thus, Chexsystems entry, I believe, will not affect your new account negatively.

But I am not fully sure on this. Others members may shed some light on it.

Regards,

Phoenix

I've read on here [this thread, IIRC] that some banks do random sweeps against Chex. And that they [loss prevention] will close an account if the holder is listed on Chex. More reading may be in order here.

Wamu does a random and a normal chex sweep of new accounts I beleive after 30 or 60 days and then at that time they can close it and then tell you that they did. I am not sure about other banks doing this.


Luke

I have been reading up on all this information and had a question. If a internet PDL reports you to SCAN or Chex as they claim isnt that Illegal? I mean don't you have to physically provide a hard copy check for this to happen? I have seen where some PDLs include a clause in their contracts allowing them to draft your account by, ACH or paper checks. Someone please clarify. Thanks!