Some banks offer 2nd chance for problem customers

To cut down on chronic overdrafts and mishandled bank accounts, banks and credit unions turn to a reporting agency that tracks problem customers and shares the information.

It's called Chexsystems. Negative checking and savings account information stays on your record for 5 years.

A pattern of problems on your Chexsystems report can get you cut off from banking at virtually every institution that uses the Chexsystem database. But some banks will give you a second chance.

Many banks and nonprofit organizations offer financial literacy classes to help consumers of all ages learn how to manage money and get back on track.

Complete the course and get a certificate, and some banks will give you a fresh start through what's called a Second Chance program.

The money management course is mandatory.

You get a new, restricted checking account.

- You have to pay a fee - typically $9 to $10 a month.

- You'll be on probation for up to 6 months

- Avoid bounced checks and overdrafts during probation and the fees are lifted.

- You're once again eligible for a mainstream checking account.

Not all financial institutions use Chexsystems and they don't all offer a second chance program.

So if bad habits have you shut out of mainstream banking, and you're ready to be responsible with your account, ask around, and try to stay local - with both the financial literacy classes and the second chance .

And if you get that second chance, don't blow it. Because there's no third chance.

Also, keep in mind that you're legally entitled to a free Chexsystem report every year, just like with the credit reports.

For more information:

www.consumerdebit.com/consumerinfo/us/en/index.htm

www.bankrate.com/finance/checking/chexsystems.aspx

www.consumerbadcreditguide.com/checkingaccountchexsystem.html