Second Chance Banking: Is It Your Best Option?

What are second chance banking accounts? They are just what they sound like!  They are designed to allow bank users to have another opportunity to use their bank accounts in a responsible manner regardless of how many times accounts have been closed.

Second-Chance accounts are worth getting if you are in a position where that is your only option. They will help you look after your money in a responsible way with a second opportunity.

How Are These Accounts Different Than Regular Checking Accounts?

Free Checking Accounts are not used very much anymore, but there are many banks who still have these available. Keep in mind that when using a second-chance account, you will be required to pay a small monthly fee, this could be anywhere between ten to fifteen dollars. You may also have to keep a certain amount of money in there to use it. Apart from this, both types of accounts are much the same.

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If the bank can see that you are starting to manage your money well, then they will allow you to have a regular checking account. This is similar to moving from a secured credit card to an unsecured credit card.

Why Would a Bank Even Close An Account?

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There are a wide range of reasons why an account has been closed down. One of the main reasons is because of too many overdrafts. There also could have been too many checks that bounced, or the user has not paid their accounts service fees.

No matter what the reason is, you can be sure that the bank will see these issues and report them. All reports go to ChexSystems who look through reported accounts and will then close the account down. Once ChexSystem has access to a bank users account, the user will then be marked as a customer who is of high-risk. If a high-risk user tries to open a new checking account, there is a good chance they will get denied.

If a second-chance account is provided by the bank, the user may still be able to have some sort of account.

Can A Checking Account Be Used For Bad Credit?

Make sure you don’t confuse second chance accounts with bad credit accounts. Many bank users get mixed up between the two accounts, particularly when it comes to bad credit. Why? Because checking-account issues and bad credit from the past will usually work together.

That said, many major banks who have ChexSystems do not perform a credit history check. A person with a bad credit history can probably still obtain a checking account.

Where To Find Second-Chance Checking Accounts

Be aware that most big retail banks will not provide Second-Chance Accounts because they are already making so much money, the profit margin from second chance accounts isn’t worth it to them.

Credit Unions and Small Local Banks

It is better to go to local credit unions and small local banks. Credit Unions are the best place to go to first because they do not charge much for their services and typically aren’t as costly as regular banks. Credit Unions also provide the user with flexibility, especially those who have genuine unforeseen circumstances. Those who have a closed account may also be allowed to bank through a credit union.

Wells Fargo Opportunity Checking

Need a second-chance account as well as a bank that can be used anywhere in the country? Then take some time to consider Wells Fargo Opportunity Checking. This retail bank can be found in 39 states. There are also well over 6,200 branches nation wide. Below are some important details for those who are thinking of opening a second chance account with Wells Fargo.

  • A fee of fifty dollars will be required to open the account.
  • The monthly fee a user will need to pay is ten dollars. (This however is able to be waived if you use your debit card ten times every month).
  • The account can be accessed on the internet at any time.
  • Bills can be paid online for free.
  • An online spending tracker can be used.
  • A platinum debit card may be obtained.

Other Big Bank Options

Here are are some other options to be aware of in regards to second-chance accounts. These may change depending on the branch of the bank.

  • PNC Bank has well over 2,700 branches around the country in 20 different states
  • Woodforest National Bank has over 750 branches around the country in 17 different stats
  • BBVA Compass has over 680 branches around the country in 7 different stats.


GoBank offers Second Chance Checking Accounts to all users who have had a regular account shut down for any reason other than fraud. In fact, opening an account with them is as simple as passing a fraud check, once passed you will immediately get access to your new account. A starter kit from Walmart can be purchased to open a GoBank account or a user can sign up for one on the internet.

Banking can be done on GoBank’s app or on the internet. GoBank does not have any physical branches and users will not be required to pay any overdraft or minimum fees. They will however, have to pay a small monthly fee of $8.95 unless there is more than $500 in the account. If there is $500 or more in the account the fee will be waived.

What To Do If You Are Denied a Second Chance Account

If you are denied a second chance account, the first thing to do is not freak out, Just because you were denied once doesn’t mean you will never be accepted.

In the meantime there are still a few things you can do to get immediate access to your cash.

Money Orders: Money orders used to be one of the most common ways to pay bills, but very few people use them these days. If you have bills to pay and don’t have a checking account, getting a money order is your best option.

Prepaid Debit Cards: These are great for every day shopping and online purchases. I wouldn’t recommend paying bills with them because of the small fee that comes with most prepaid debit cards, but if you need to pay with a card, this is a great alternative.

Secured Credit Cards: These are great if you need to rebuild your credit. The only downside is you will need to put down a much larger deposit than you would for a prepaid debit card, but if you have enough money for the deposit I would highly recommend going this route.

Mistakes To Avoid

Regardless of whether or not you get approved for second chance banking, there are a few mistakes that are very important to avoid.

Check cashing stores are becoming popular but are a very bad idea because of the very large fee’s that come along with them. These shops take as much as 4% which is WAY too much. These places will then try to sell you on taking out a loan with them which will make your bad situation even worse due to the insanely high interest rates.

Payday loans should be avoided regardless of what your financial situation is because their interest rates are sky high. They trap people into borrowing from them to pay off a current loan. It is very hard to get out of this trap. If you choose an auto-title loan, you will likely have to sell your vehicle to get the money you need.

Second-Chance Accounts Can Give You A Fresh Start

When you owe the bank money, you can be sure they will be on your back until they have been paid back. If you have been successful in obtaining one of these accounts, show the bank that you have changed. Prevent overdraft fees, watch your balance, pay fees in full and straight away, stay away from suspicious activity and fraud.

After a few months of properly managing your second chance account, your bank will allow you to switch over to a regular account with a fresh start.

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