Most of us know pretty well about the 3 credit reporting agencies: TransUnion, Experian and Equifax. The 3 credit reporting agencies record and maintain your personal and business credit information. Whenever you want to apply for a credit card, a mortgage, or an auto loan, you have to provide you detailed personal information to the credit grantor who will then randomly check your credit report from one or all three above mentioned credit reporting agencies. The purpose to check your credit information is to verify your personal information to prevent any potential ID fraud and check your past credit history to determine whether or not to approve your credit request. You can always get a free credit report every year from www.annualcreditreport.com mandated by the Fair and Accurate Credit Transaction (FACT) Act (an amendment to Fair Credit Reporting Act).

Actually, there is another check system which might contain your personal information, that is, ChexSystems. ChexSystems is a consumer information database providing deposit account verification services to its financial institution members to help determine the risk of opening a new checking or savings account. Anyone who has a history of account mishandling will be reported to ChexSystems and can be used for future reference. Obviously credit reporting agencies provide information on how a consumer handles his/her credit relationships. However, ChexSystems provides data on how a consumer handles his/her deposit accounts at banking institutions. Currently, about 80% of U.S. banks and credit unions are using ChexSystems to determine whether or not to approve your checking, savings, money market or other banking accounts application. As most of my readers will open a checking or savings account for some sign-up opportunities, I think a brief introduction of ChexSystems is necessary.

How can ChexSystems collect personal information?

Banks, credit unions and other financial institutions report incidents to ChexSystems to protect themselves and other banks in the future. Your name will be reported to ChexSystems if your banking account is closed by the bank for the following reasons:

1. Banks were unable to collect for an overdraft, ATM transaction, automatic payment, bill payment or other transactions that they honored on insufficient funds.

2. Depositing fraudulent checks or other suspicious account activities.

3. Providing false information at the account opening.

4. Savings account, debit card, ATM card abuse.

How long does the report stay on file? How do you get it deleted?

Each incident will stay on your record at ChexSystems for five years from the date the incident is reported unless there is a legitimate reason to remove it.

You should also know that any bank or credit union is under no obligation to remove an accurate report of account mishandling due to payment of money owed. However, if a collection amount is paid in full, the report would be marked as paid.

Can you order a copy of your record?

Yes, you can order a free copy from ChexSystems from this link. If you are rejected by a bank or credit union and ChexSystems was used in the decision process, you can order a copy from ChexSystems from this link.

How do you dispute a false information?

You may contact ChexSystems Consumer Relations Department to help you correct any misinformation contained in ChexSystems. You can submit you dispute to ChexSystems:

By Mail: Chex Systems, Inc.
7805 Hudson Road, Suite 100
Woodbury, MN 55125

By phone: 800-428-9623

By fax: 602-659-2197

ChexSystems is also licensed to do business as ChexSystems Collection Agency which is providing debit collection services.

A sample ChexSystem Consumer Report can be downloaded here from MyCardBlog.Com.