[Closed] Interesting Letter from my bank today.

Guess you've been Halif****d

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Fire at will.

Have had a similar thing with an A&L bank account for over a year now- 50p per day if you use any of an agreed overdraft, be it 1p or £1000 in the red.

Er...that's rather bad on their part, how can they expect people to put up with this. I'd be switching banks if I were you.

they are all out to make money to pay their dwindling staff huge bonuses to stay

Looked into changing banks over the past week or so. Don

h

nt much, they are all much of a muchness.

Like all business atm they are all trying to scratch a living somehow.

I did get the impression from most of the bank staff we spoke to they are all pretty much down in the dumps atm 😕

Ditch and switch.

[url= http://www.moneysavingexpert.com/news/banking/2009/10/halifax-high-interest-customers-will-soon-earn-zero-interest?utm_source=forum&utm_medium=sidebar&utm_campaign=box ]Moneysavingexpert.com[/url]

If I went £1000 overdrawn I would pay £1 for each day overdrawn = 0.001% interest.

um, it would be £365 per annum which is 36.5%...

Alternatively, you could just make sure you only spend your own money and not borrow it from the Bank without permission? I know it's a bit of a wild concept, but it might just work.

can you ditch and switch if say you are in your arranged overdraft on a regular basis??

Of course. Just ask your new bank to let you have an authorised overdraft while you're opening the account. As long as they stand to make enough money out of it, why would they refuse?

Or druidh, he could ditch this bank and set up an account which gives you an overdraft at a reasonable rate? I don't know what world you live in, but an overdraft with the bank IS with their permission. This is another way for banks to stiff people who are poor at managing money.

So it looks like the banks simply don't want personal customers who go overdrawn? Or alternatively see them as a cash cow? Neither explanation and there are probably others really bothers me - probably not been overdrawn for the last 20 years or so since starting work - am I in such a minority?

Pretty sure I would not be choosing who I bank with based on the overdraft fees

hmm was just at said bank this afternoon enquiring about a mortgage - looks like they have lost out on that as well.

isnt this a tactic to get you to switch to a charging account:

http://www.halifax.co.uk/bankaccounts/bankaccountsweoffer.asp

Cash cow GJP, look at the drama over bank charges. The banks are clearly looking for ways to replace that revenue stream and this is one of them. My bank came up with a fairly thinly veiled 'service' to replace bank charges, which seemed to mirror the previous situation almost exactly.

Who knows if you are in a minority? The levels of personal debt in the UK would suggest that you are though.

hmm poor at managing money perhaps a little harsh without knowing all of the details.

If I went £1000 overdrawn I would pay £1 for each day overdrawn = 0.001% interest.

um, it would be £365 per annum which is 36.5%...

Agreed,

Ok, the 'fine for going £1000 over drawn per day = 1/1000 of the total per day,
so in theory you could 'borrow' £2499 for a calendar month and it would only cost you a maximum of £31, which seems a pretty good deal for a short term loan ?

and in theory if I go 10p, the fine is 10 times the total.
My 10p however would also cost me £31 wich is a bit expensive.

It seems people here think cos you go overdrawn at the bank you are 'poor' ?
If you have a need for an overdraft to be set up the bank would have to have confidence that you can pay said overdraft when and if they were to demand the overdraft be repaid.
You usually need to have your earnings paid into your account on a regular basis.
An overdraft used to be a bonus when we used to write lots of cheques - as people used to do when they were short of cash, and knew the cheque would have 'bounced' without the safety net of the overdraft, but its different these days as cheques are a last resort to most folk.

I don't know Haribo, I would class anyone using an overdraft as being poor at managing money. I include myself in that BTW. Perhaps I could just have said anyone poor, because I guess you could have a low paid job and budget fairly well, only to be made redundant and need an overdraft.

RichPenny,

I would class anyone using an overdraft as being poor at managing money

Personally, an overdraft is nothing to do with being poor at managing money.
I think the worst thing you can do with your money is use 1 bank for everything. ie, mortgage, current a/c, savings a/c

Did you know for instance,

If you fell behind with mortgage payments the bank can take money out of any savings a/c you have with them ?

They cant if you seperate these across 3 different banks.

And lo the ubiquitous pedant crept in from the darkness of the topic's outer edges.

Hello PT. Have you had alphabet spaghetti for tea again ?

On closer inspection I can see benefits to the customer from the above approach. It provides clear transparency to the customer over what charges they will incur. A simple flat (albeit tiered) fee for each day overdrawn for authorized overdrafts and clear penalty for those who go overdrawn without prior authorization.

It is perhaps a pity that it is not a simple flat rate per day but the example above shows why the bank has implemented a tiered approach. Given the customer backlash over the lack of transparency of bank charges and their unfairness then I can certainly see why a bank would go for this approach. IMO it seems like some customers both "want their cake and eat it".

That is interesting never, I didn't know that about the mortgage account. Mine is with a different bank, but I don't really have a savings account. I don't see the benefit of paying for an overdraft if you have savings though. I am currently doing this at times, but only because I'm shit with money. This thread has been useful, because I've realised that I'm paying far too much for my overdraft and I can earn £125 just by switching accounts 🙂

GJP, can you also see the negatives for the customer: He's almost certainly going to be paying MORE for his overdraft, if for example it averaged at £1k you'd be paying 2-3 times more interest......

If you fell behind with mortgage payments the bank can take money out of any savings a/c you have with them

Sounds good to me as should reduce interest payments.

I can't be ar5ed with managing money too closely so I have an offset mortgage - never have to worry about what my balance is or if something is going to get paid OK.