Understanding the Basics of a Second Chance Bank Account

Do you need and deserve a second chance financially? We have all made financial mistakes at one point or another in our lifetimes. And while some mistakes are short lived, other financial mistakes seem to follow us for years. In the event that you have financial issues with financial institutions, you may be unable to obtain crucial financial instruments such as checking and savings accounts through traditional channels. If this is the case, it may be time to explore how a second chance bank account can benefit you and your financial life.

What is a Second Chance Bank Account?
A second chance bank account is a checking/savings account offered to individuals who have been denied these same financial accounts through traditional banking channels. Higher fees are often associated with these bank accounts to provide protection to the financial institution offering to open an account for your personal or business use.

Why Do you Need a Second Chance Bank Account?
Sure; you could work on a 100% cash basis if absolutely required. But, consider the headaches associated with paying for utility bills, rent, automobile loans, insurance and cell phone bills with money orders each and every month. Every time a bill is due, you are required to take cash to a financial institution in order to exchange it for a cashier’s check or money order. Then, you must send this money order or cashier’s check to the company in which you owe funds. Every time you must trade your cash for one of these other financial instruments, you are assessed a fee.

In addition to day to day household bill hassles, you must also manage to convert your paycheck every week, every 2 weeks or every month into cash. Again, you will have to find a location that will agree to cash your check, and you will be assessed a fee each and every time you complete this type of transaction. While a few dollars here or there may not seem like much, the figures are astounding when you add them up over the course of an entire year.

Even if you were able to successfully manage paying cash for all of your household bills, you will not have access to one of the most important financial instruments associated with a traditional bank account; a debit card. The MasterCard or Visa logo associated with your bank debit card allows you to complete purchases online, in retail establishments, to withdrawal cash and to apply for credit. Without it, you are limited in a variety of ways financially.

A second chance bank account is exactly that- a second chance. While there may be fees associated with the account initially that are higher than traditional checking or savings accounts, they are typically lower than the fees you are already paying to live an all cash lifestyle. And, once you rebuild your credit through responsible banking practices, you will be able to earn the right to move up the ranks within the banking world over time!