Your ChexSystems Report: What Is On It, Why It Matters, and How to Dispute It

Nicolas Cesare  | 

Retailers use systems like TeleCheck and Certegy to help them decide whether or not to accept a check from any given consumer. But, retailers and other merchants aren’t the only ones interested in the history of your checking account — banks and credit unions are as well. These institutions use ChexSystems to evaluate your checking history when they’re trying to decide whether or not to open a checking account in your name.

What Is ChexSystems?

When lenders and credit card companies want to evaluate you as a borrower, they use your credit score. However, credit scores don’t capture all of the relevant financial information about a person. Your credit report includes information about your history of repaying debt, paying your credit card bills on time, and so on.

However, this information isn’t always useful when you’re thinking about opening a checking account. Financial institutions want different information than what’s covered in your credit history. For example: your history of keeping plenty of money in your checking accounts, your overdraft history, or unpaid fees at previous banks or credit unions. ChexSystems exists to provide this information to banks and credit unions, in much the same way that the credit reporting agencies exist to provide credit information to lenders.

ChexSystems Consumer Score

Credit reporting agencies will assign you a credit score depending on the quality of your credit history. ChexSystems does the same thing with your banking history. It assigns consumers a score between 100 and 899. The higher your score is, the more likely banks and credit unions are to let you open an account with them or even court you as a potential customer.

How Does ChexSystems Work?

ChexSystems calculates your consumer score by getting information on your banking history from financial institutions that you have worked with in the past. In particular, ChexSystems is interested in information such as:

  • Your history of overdrafting or keeping insufficient funds in your checking account.
  • Any past banking fees that were left unpaid for a period of time.
  • Any violations of banking rules and regulations.

Bad records will make your consumer score go down, whereas a responsible and clean checking history will make it go up. Bad marks, such as an unpaid overdraft fee, will stay on your ChexSystems report for five years before being wiped off.

It’s important to keep in mind that, while your ChexSystems consumer score and your credit score are both important financial metrics, they don’t affect one another. It’s possible to have a great credit score while having a poor ChexSystems consumer score, and repairing your credit won’t necessarily repair your ChexSystems report at the same time.

How to Get Your ChexSystems Report

Since ChexSystems gathers consumer information, they must follow the rules set forth by the Fair Credit Reporting Act (FCRA). This includes giving consumers free access to their report at least once every 12 months. There are several ways to get your ChexSystems report:

Online

You can send a request online through the ChexSystems website. Make sure to have your social security number handy as well as information about any previous addresses that you have lived at over the past five years. Once you submit your request, ChexSystems will send you a copy of your report within five business days.

Phone

You can call ChexSystems at 1-800-428-9623 to be put on the phone with an automated system that will gather your information for a consumer report request.

Mail

Fill out a Consumer Request for Disclosure Form available from the ChexSystems website and mail it to the following address:

Chex Systems, Inc.

Attn: Consumer Relations

7805 Hudson Road, Suite 100

Woodbury, MN 55125

You can fax that same report to (602) 659-2197.

How to Dispute Your ChexSystems Report

It’s important to see a copy of your ChexSystems report from time to time and check it for any errors. Errors on your report could be the result of an honest mistake or they could be the product of identity theft. If you are the victim of identity theft, then it’s very important that you dispute your ChexSystems report to have the false information removed.

Getting a Removal

In order to submit a dispute and have information removed from your ChexSystems report, you can either submit a dispute online using the ChexSystems website or fill out a Request for Investigation form and mail or fax it to the address or number above.

Be sure to attach any documents that support your version of events to your dispute.


Image Source: https://depositphotos.com/

Nick Cesare is a writer from Boise, ID. In his free time he enjoys rock climbing and making avocado toast.

This post was updated July 18, 2018. It was originally published June 25, 2018.