Second Chance Checking - Pitfalls

Since a lot of people nowadays have a bad credit history – as a result of missed payments, credit card debt, and bounced checks – they are finding themselves unable to open regular bank account as no bank wants their business, especially where it is accompanied with a bad credit rating.

As a result, a lot of people are choosing second chance checking accounts since they allow people to open accounts even if they have bad credit history. These accounts, however, do have some restrictions, or pitfalls, that you need to be aware of before you open one.

Most of these bank accounts will limit your ability to write checks or have withdrawal limits. You also cannot have an overdraft with these accounts. Another problem people face is that you are charged monthly fees while not being allowed to have a debit card. You are given a Visa or Master card that serves as a check card that you can use to monitor your account and its real time activity. Another problem with these accounts is that you can only deposit funds through your employer via a direct deposit, which is a huge inconvenience.

If you are facing trouble opening a normal checking account, you might want to look for other options before considering a second chance checking account.