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The Top 5 Second Chance Bank Accounts

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It may not have been reviewed, approved or otherwise endorsed by the credit card issuer. This site may be compensated through a credit card issuer partnership.

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Some banks don’t like giving second chances to customers who have less-than-stellar financial histories, especially since it could expose them to expensive risks. A record of bounced checks or debit card overdrafts could easily lock you out of the conveniences of modern banking.

Fortunately, banks also like making money, and some offer special “second chance” accounts that minimize their risk while allowing consumers to stay in the banking system. A second chance bank account gives customers with troubled records a fresh opportunity to demonstrate they can bank responsibly.

When it comes to a second chance account, fees are an unfortunate reality. But some accounts offer customers a better deal than others, and we’ve researched our database to find the second chance accounts with the most reasonable fee structures, while also factoring in whether they provide online and mobile banking, and how accessible accounts are throughout the country.

Second chance account basics

With a second chance bank account, customers shut out of traditional bank accounts get the opportunity to win their way back into a bank’s good graces. Similar to credit bureaus, financial services company ChexSystems maintains records of consumers’ banking histories. Bounced checks, overdrawn accounts or instances of fraud can all end up on your ChexSystems record; if you accumulate enough black marks on ChexSystems, banks could deny your application to open a new account.

Because second chance accounts are meant for customers who have demonstrated bad banking behavior, some lack features of traditional accounts, such as overdraft protection. In the eyes of the bank, you represent too much of a risk for them to extend you such courtesies.

Nobody likes paying fees, and we generally advise consumers to avoid needless banking fees due to the many fee-free banking options available. But fees are the price you pay for access to banking when you have a poor record. Plus, the second chance accounts listed below give you access to online and mobile banking, which is always a plus.

The 5 best second chance bank accounts

1. Chime

Checking Account Fintech app developer Chime is not a bank, however their online checking account product is open to everybody, no matter how bad your record is with ChexSystems. Chime does not check on applicants with ChexSystems, plus they offer lots of non-traditional features to help you get your financial life back on track. Best of all is the fact that they charge no fees at all, and require neither a minimum opening deposit or a minimum balance.

Chime account features:

  • No opening balance or minimum balance requirements.
  • Set up direct deposit for your paycheck, and the funds from each pay period will be deposited as soon as the transaction is initiated, giving you access to your pay up to two days earlier than conventional checking accounts.
  • Automatic savings features to help you save in your connected Chime Savings account.
  • The app sends you daily bank account balance notifications, and sends transaction alerts every time you use your debit card.
  • You can disable the debit card from the app.

Fees to watch out for:

  • Chime’s service is almost entirely fee-free: No monthly charges, no ACH transfer fees, no foreign transaction fees, and no ATM fees if you withdraw funds from MoneyPass ATMs.
  • If you make an ATM withdrawal outside of these networks, there is a $2.50 fee.
  • Overdrafts are not permitted, so there is never an overdraft fee.

2. Peoples Bank Cash Solutions Second Chance Checking

Second Chance Checking This Texas-based bank offers a second chance bank account that is available nationwide, and so long as you don’t have a record of bank or checking fraud on your record, you should be approved for this account. You’ll need to deposit at least $30 before the bank activates your account and provides you with checks and a debit card.

Fees to watch out for:

  • $4.95 monthly maintenance fee
  • $27.50 overdraft fee
  • $27.50 nonsufficient funds fee
  • $3.95 printed statement fee (which can be avoided with electronic statements)
  • $2.00 ATM withdrawal fee at machines not owned by Peoples Bank
  • $25 stop payment fee
  • $20 account closure fee (if within 90 days of opening account)

3. LendingClub Essential Checking

Essential Checking Products from online bank LendingClub are available to customers nationwide, and accessibility is a strong point in its favor. This second chance bank account only requires customers to deposit $10 to open an Essential Checking account, which is lower than some other accounts on this list.

Account Features:

  • A free debit card
  • 24/7 mobile and online banking
  • Access to LendingClub’s budgeting and personal finance tracking apps
  • Eligibility to upgrade to LendingClub’s Reward Checking account after 12 months of positive banking history

Fees to watch out for:

  • $9 monthly maintenance fee
  • $25 per item non-sufficient funds fee (waived on all overdraft items $5 or less)
  • $5 daily overdraft fee

4. Varo Bank Account

Varo Second Chance Varo only offers a few banking products, but their main bank account is designed for second-chance banking. There’s no credit check, no minimum balance requirements or monthly fees and no overdraft fees — if you try to overdraw your account, your transaction will be declined. Varo customers can withdraw money fee-free from the Allpoint ATM network, which has ATMs in stores like Target, CVS and Walgreens.

Varo Bank Account Features

  • Varo Bank allows you to deposit checks through a mobile app once you’ve received a direct deposit in the account, and you can deposit cash through Green Dot locations.
  • Once you’ve set up a direct deposit, you can earn your paycheck a few days early through Varo.

Fees to watch out for:

  • $2.50 for out-of-network ATM withdrawals
  • $5.95 for cash deposits via third party money transfer services
  • $2.50 for over the counter cash withdrawals

5. Woodforest National Bank Second Chance Checking

Second Chance Checking This regional bank has a checking account aptly named Second Chance Checking, to help people rejected by other banks access — provided they live in one of the 17 states where a physical branch exists and can meet the $25 minimum opening deposit requirement. Those states are: Alabama, Florida, Georgia, Illinois, Indiana, Kentucky, Louisiana, Maryland, Mississippi, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, Virginia, and West Virginia.

Fees to watch out for:

  • $9.95 monthly maintenance fee if you use a direct deposit
  • $9 one-time account set-up fee
  • $2.50 ATM withdrawal fee when used at a non-Woodforest network ATM
  • $15 debit card set-up fee
  • $32 overdraft fee (for each charge)

Alternatives to a second chance bank account

Get a prepaid debit card

Tired of the traditional banking experience? You could opt for a prepaid debit card instead. With a prepaid card, you can load money onto it and spend at merchants that accept major credit and debit cards. But if you try and spend more money than what’s on the card, the transaction is declined — although this prevents you from accruing any overdraft or insufficient funds fees. This is useful if you feel you may still have trouble managing your spending and need an extra layer of security to prevent you from getting into trouble.

Some prepaid cards offer extra perks like advance direct deposit and free ATMs so long as you stay in their network.

Open a secured credit card

You may also have better luck applying for a secured credit card if your credit score is in good enough shape. Usually, this requires depositing cash with the lender, who then gives you the credit card for the same amount. Each month that you make on-time payments, the bank will report that good behavior to the credit bureaus, helping you boost your credit score. At the end of the payment period (generally 12 months, though it varies by banks), you’ll get the full deposit back.

Secured cards can come with high interest rates and many don’t feature the enticing rewards other high-end cards do, but they get the basic job done for consumers who don’t need a card with a high credit limit.

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Charles Schwab Bank Review 2022

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Charles Schwab Bank

Charles Schwab & Co. started as an investment brokerage firm in the early 1970s, and that’s still its specialty. However, in 2000 it launched Charles Schwab Bank to offer basic banking services like checking accounts, savings accounts and loans.

Charles Schwab has branches around the country where customers can get in-person support for their banking and investment needs. The Charles Schwab Bank deposit accounts do a great job keeping fees low and offering free ATM access, but they don’t pay much in terms of interest.

Charles Schwab Bank savings accounts 4 out of 5

Schwab Bank High Yield Investor Savings
  • APY: 0.05% on all balances
  • Minimum opening deposit: None
  • Monthly fee: None

The Schwab Bank High Yield Investor Savings account doesn’t have a minimum balance requirement, so you can open one with any amount of money. It also doesn’t charge a fee, regardless of how low your balance is. This savings account comes with a debit card, which lets you make free withdrawals from any ATM in the world (notably, Charles Schwab Bank will refund any fees charged by the ATM owner). You can also access your account by mobile app, but only if you have a Charles Schwab brokerage account.

However, since this is a savings account, Regulation D limits do apply — as such, you can only make six of certain transactions, like bill payments or debit card purchases. If you exceed these monthly limits, Charles Schwab Bank could close your account or convert it into another type of account, like checking. However, these rules do not apply to ATM withdrawals, so you can make as many of these as you want per month.

The Schwab High Yield Investor Savings account earns interest on all balances and the rate is always the same. But despite being called “high yield,” this account doesn’t pay that high of an interest rate.

This account could be worth using if you invest with Charles Schwab and want to keep some of your uninvested cash in a savings account, which you can easily access thanks to the free, global ATM access. However, if you’re looking to grow your savings by earning interest, you’d likely be better with one of the top options on the market today.

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Charles Schwab Bank checking accounts 4.5 out of 5

Schwab Bank High Yield Investor Checking
  • APY: 0.03% on all balances
  • Minimum opening deposit: None
  • Monthly fee: None

Charles Schwab Bank also offers a checking account for its brokerage account customers. You must have a linked Schwab One brokerage account to open this checking account. However, you can open them at the same time and there are no fees, minimum balance or minimum trade requirements to launch a brokerage account.

There’s also no minimum deposit required to open a Schwab Bank High Yield Investor Checking account, and it won’t charge a monthly fee, regardless of your account balance. This account earns a moderate interest rate on all balances. It also comes with a debit card for making purchases, though you won’t earn cash back on your spending. This account also comes with a mobile app for account management, mobile deposits and mobile pay.

In terms of ATM access, this account is excellent. Though Charles Schwab Bank doesn’t have its own ATMs, you can make free withdrawals from any ATM in the world. Charles Schwab Bank will refund any ATM fees and doesn’t charge a fee for converting your dollars into other currencies for international withdrawals.

However, if you overdraft your account, Charles Schwab Bank won’t cover the overdraft. Instead, it denies the transaction and charges a nonsufficient funds fee (NSF fee) of $25 per transaction, up to $100 per day maximum. However, you can link to other Charles Schwab checking, savings and brokerage accounts to cover overdrafts using those balances — and Charles Schwab Bank won’t charge a fee for doing so.

This account could be useful for those who want a free checking account that also offers excellent free ATM access, especially for international withdrawals. On the other hand, if you’re trying to earn interest on your checking account too, you might be better off with some of these excellent options. They also keep fees low while paying respectable interest rates.

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Charles Schwab Bank CDs0 out of 5

Charles Schwab Bank doesn’t offer its own line of CDs. Through its brokerage service, customers can compare and purchase CDs from other banks for a transaction fee (online it’s $1 per $1,000 CDs, with a $10 minimum and $250 maximum fee). If you’d prefer to skip this transaction fee and buy a CD directly from a bank, we’ve ranked the very best CD rates on the market today to help you decide.

Customer experience at Charles Schwab Bank

Charles Schwab Bank uses the same branches as the Charles Schwab financial network, which are nationwide. You can visit these professionals to handle your banking needs, like depositing checks, as well as reviewing your investments and financial plan. You can also get help by live chat or by phone.

Charles Schwab Bank doesn’t have its own ATMs; instead, they allow their customers to access any ATM in the world for free by refunding any charges from the ATM owner. However, the one downside of this system is that there is no way to directly deposit cash.

If you have a Charles Schwab Bank account, you can access it through their website. Through one login, you can see all your accounts in one place, including your investment accounts. They also offer a mobile app (provided you have an existing brokerage account), which allows you to manage accounts, deposit checks and transfer funds to other people.

Customer reviews of Charles Schwab Bank have been mostly positive, with an average score of 4 out of 5 stars on DepositAccounts.com. Positive reviews expressed pleasure with the ease-of-use of the website and mobile app, the effectiveness of Charles Schwab Bank’s phone customer service to solve problems and happiness with the global ATM network. Negative reviews seemed to focus on specific problems, like a customer who unexpectedly had their account closed or a debit card withdrawal denied, which could have skewed their review. Overall, though, most reviewers seemed satisfied with Charles Schwab Bank.

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Capital One Review 2022

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Capital One

Headquartered in McLean, Va., Capital One spun off from Signet Bank in October 1994. Originally a credit card company, Capital One has expanded into full-fledged banking, offering everything from business and commercial products to personal checking and savings accounts and CDs.

Through its Capital One 360 division, the company’s personal banking accounts are characterized by their low required minimums and fees. The company offers a well-rated mobile app, extensive fee-free ATM access and Capital One cafés, where you can grab a cup of Peet’s coffee while doing your in-person banking. Here’s an overview of the bank’s deposit accounts.

Capital One savings accounts 3 out of 5

Capital One 360 Performance Savings
  • APY: 0.40% on all balances
  • Minimum opening deposit: $0
  • Monthly fee: $0

Capital One’s 360 Performance Savings account is a simple, straightforward savings account that comes with some added features. The account has no fees and no minimums, yet it still pays an APY many times the national average, currently 0.40%. Customers have access to the Capital One mobile app and digital savings tools (which include automated transfers), but there is, notably, no ATM access allowed with this account.

Overdrafts are not allowed with this account, which may be a plus or a minus depending on what type of customer you are. Meanwhile, outgoing wire transfers incur a fee of $30. In addition, according to Federal Reserve Regulation D, you are limited to six transfers from savings accounts per statement cycle, although there are no limits on transfers into your own account. Capital One has currently suspended this regulation, although it may be reimposed at any time.

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Capital One Kids Savings
  • APY: 0.30% on all balances
  • Minimum opening deposit: $0
  • Monthly fee: $0

The Capital One Kids Savings account functions almost identically to the 360 Performance Savings account, but with a few minor differences. For example, while the account offers access to the Capital One mobile app, there are parental controls available. The app can be used to automate savings deposits to the account, make mobile deposits or set up and track savings goals.

The account is limited to kids under the age of 18 who have a parent or legal guardian available to open an account on their behalf. The adult who opens the account must link the Kids Savings account to their own personal checking account at another institution. To fund the account, you must make an electronic transfer from your linked checking account or send a personal check.

Like the 360 Performance Savings account, this account has no fees or minimums and pays a decent interest rate, although the APY for this account is 0.30% as opposed to the 360 Performance Savings account’s 0.40%. Withdrawals are limited to six per month, including internal transfers. However, there is no ATM access with this account; parents must log in under their own username to make transfers out of the account.

All-in-all, the account offers kids the opportunity to learn about how savings accounts work, mostly within the same parameters as the 360 Performance Savings account. In fact, when account holders reach the age of 18, this account will automatically turn into a 360 Savings account.

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To compare the Capital One savings accounts with competitors, check out MagnifyMoney’s best savings account roundup.

Capital One checking accounts 4.5 out of 5

Capital One 360 Checking
  • APY: 0.10% on all balances
  • Minimum opening deposit: $0
  • Monthly fee: $0
  • ATM access: 70,000+ fee-free ATMs

The Capital One 360 Checking account is a good option for those looking for an account with no minimum deposit requirement and no fees. Unlike many of its no-fee competitors, this account also pays a 0.10% APY on all balances.

For a free checking account, the level of available services on this account are impressive. For starters, you can use your Capital One debit card to access over 70,000 fee-free ATMs across the country, including those in the MoneyPass and AllPoint ATMs. Customers can also access peer-to-peer payment capability via Zelle. The first 50 checks for any account are free.

Capital One doesn’t provide rebates for out-of-network ATM fees charged by third parties, but it also doesn’t assess any fees itself. Overdrafts are allowed with this account, subject to a $35 fee — however, there is a Next-Day Grace option which allows account holders one day to bring their account current and avoid the $35 overdraft fee. Outgoing domestic wire transfers incur a $30 fee.

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Capital One MONEY Teen Checking
  • APY: 0.10% for all balances
  • Minimum opening deposit: $0
  • Monthly fee: $0
  • ATM access: 70,000+ fee-free ATMs

The MONEY checking account is designed for kids at least 8 years of age. As with the Kids Savings account, an adult is required to sign on to the account and link a checking account, and parental controls are available. However, this account does offer ATM access, with the same network of fee-free ATMs as the adult accounts at Capital One.

The account is designed to teach teens — and even those as young as 8 — the basics of having their own banking account. Minors can use the account’s mobile app to perform a wide variety of basic banking tasks, from checking their balances and setting savings goals to depositing checks, setting up remote deposit and getting text alerts and notifications. However, there is no physical check writing available with this account.

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To compare this and other Capital One checking accounts with the competition, check out MagnifyMoney’s best checking account roundup.

Capital One CDs 2 out of 5

TermAPYMinimum opening deposit to earn APY
1 year0.20%$0
3 years0.75%$0
5 years1.00%$0

Capital One CDs offer terms between six months and 60 months, with a total of nine different terms available. Rates range from a low of a 0.10% APY for the 6-month CD to a high of 1.00% APY, available on the 60-month CD. All Capital One CDs have a $0 minimum investment. Interest is accrued daily and compounded monthly; you can choose to pay out your interest monthly, annually or at the end of the CD term. In addition, all CDs carry FDIC insurance, though there are no jumbo or no-penalty CDs available.

Early withdrawal penalties apply to Capital One CDs. The early withdrawal penalty for terms up to and including 12 months is three months of interest. For CD terms longer than 12 months, the penalty for withdrawing early is six months of interest. CDs automatically renew into new CDs with the same term, though there is a 10-day grace period in which the CD can be redeemed.

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Check out MagnifyMoney’s best CD roundup to see how Capital One’s CDs stack up against the competition.

Customer experience at Capital One

Capital One combines branches, cafés and an online experience to serve its customers. Although the bank’s annual report doesn’t disclose the number of physical locations it has, it does note that it utilizes “2.3 million square feet of bank branches and cafés,” mainly in New York, Louisiana, Texas, Maryland, Virginia, New Jersey and California.

You can open any type of account on the bank’s website, in addition to performing all account maintenance transactions. The mobile app has great functionality, allowing most account management tasks including bill pay, rewards redemption, remote deposit and P2P payment via Zelle. The app also receives high ratings from users — 4.7 stars on Google Play and 4.8 stars on the App Store (at time of writing).

The bank has a vast network of fee-free ATMs, including over 70,000 across the MoneyPass, Allpoint and Capital One networks, though not all accounts offer ATM access, as described above. Automated customer service is available 24/7 at 800-655-BANK (2265), with customer service bankers available 7 days a week, from 8 a.m. to 11 p.m. EST.

All-in-all, the bank offers a modest range of personal deposit accounts that have no fees or minimums and pay decent APYs. The mobile app allows customers to handle most of their transactions remotely, extending the bank’s reach beyond its primary seven-state coverage area.