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November 9, 2004 09:19 AM

ChexSystems Puts Him In Penalty Box


Excerpt: Dear Dr. Don, I have problems with ChexSystems and cannot open a checking account at this moment. I found a Web site online that says it will make it possible for me to open a check-less checking account that will...


Dear Dr. Don,
I have problems with ChexSystems and cannot open a checking account at this moment. I found a Web site online that says it will make it possible for me to open a check-less checking account that will allow me to pay bills and make it better for me to use my paycheck by using direct deposit. Have you heard about DirectChecking.com? What can you tell me about it? Is this true?
Thanks in advance,
-- Jose Jump-start

Dear Jose,
Negative information on your consumer banking report with ChexSystems can make it next to impossible to open an account with a bank that uses that report in making its decision to accept you as a customer. Negative information stays on your consumer report for five years before it drops off.

What DirectChecking.com is offering looks like a product called a stored-value card. It gives you a "checking account" without giving you any checks. By forcing you to use its ATM/debit card or bill-paying service, it can check your balance in the authorizing process and doesn't have to worry about you writing bad checks. Checks are an optional feature if you sign up for direct deposit. You can also link a MasterCard to the "account" like a secured credit card for an extra fee.

I'm using the "quotes" because I'm not very comfortable with this whole arrangement. The account forms list EasyTel/Genie Bank, but you make your deposits at a Bank of America or a Wells Fargo branch? You have to pay $35 for an ATM card? Checks are an option?

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Read all 13 posts in the same category of Banking:

Paper Checks Going Bye-Bye? - Dec 08, 2004
Check It Out: Incentives to Pay Bills Online - Dec 07, 2004
'Gift Cards' May Come Loaded With Fees - Nov 29, 2004
Where To Keep Your Rainy Day Fund - Nov 29, 2004
What's Your Bill-Paying Personality? - Nov 28, 2004
Debit Cards Lack Protections Of Credit Cards - Nov 28, 2004
A New Era In Banking Begins - Nov 25, 2004
Automatic Debit Scams - Nov 22, 2004
Bank Accounts Fail To Follow Fed's Lead - Nov 12, 2004
"Check 21" Starting in Late October - Nov 03, 2004
Gift Cards 04 - Nov 03, 2004
Save Electronic Checks for Your Taxes - Nov 01, 2004