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What is a Second Chance Checking Account?

  • July 6, 2021
  • By Erin Palmer

    Erin Palmer

    Content Marketing Specialist

    Erin Palmer is a content marketing specialist for Suncoast Credit Union. She has written articles for numerous publications and websites, including the Chicago Tribune and Huffington Post. Erin is happiest when curled up with a book, trying a new restaurant or playing with her dogs.

    We’d love to hear your thoughts about the blog! Email us and share what you think.

Much like lenders review credit history before approving a loan, financial institutions review banking history when someone applies for a checking account. If there have been certain instances in your banking history, like accounts closed due to unpaid overdraft fees, it may impact your ability to get approved for a traditional checking account.

A second chance checking account is a way to rebuild your banking history and get some of the checking account services you need. However, the account might come with fees and restrictions.

How Do Second Chance Checking Accounts Work?

To start, keep in mind that some financial institutions have specific products designed for second chance banking. Other financial institutions might offer their traditional checking account with some additional terms. Either option can help you develop a positive banking history over time.

When you apply for a checking account, the financial institution will review your banking history to determine approval. If you made payments with insufficient funds, had unpaid fees, past accounts closed, or other negative items in your report, you might be approved for a checking account with certain limitations.

The particular limitations will vary depending on the financial institution. One common item for second chance checking is the accounts often include fees. It’s similar to how a lower credit score will often lead to higher interest rates for loans.

Another thing to expect with second chance banking is that the checking account will likely come with certain limitations. Again, this will vary based on the financial institution. Sometimes the account might not allow for ATM or remote deposits. They also might not include things like overdraft protection.

Sometimes a second chance checking account may not come with a debit card. Other requirements could include a minimum opening deposit. Pay attention to the terms of the account to make sure you understand all of the fees, account limitations, and other requirements. If you have any questions, ask the financial institution for more details.

Second Chance Checking Can Improve Your Banking History

A second chance checking account is an opportunity to rebuild your banking history. Though you might have certain restrictions with this sort of account, you’re working toward a better financial future  and that’s always a good thing!

Just like you can increase your credit score over time, you can improve your banking history too. With responsible banking, you can eventually qualify for a traditional checking account without the additional restrictions.

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Smart Checking™ from Suncoast is Here for You! Our checking account is a great fit for rebuilding your bank history. Restrictions may apply.


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