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Overdraft Reduction
monkey1984_2
Posts: 8 Forumite
Today I received a letter from my bank (Nationwide) reducing my 1600 pound overdraft to 500 pound. They expect full payment in 3 weeks! I am currently a student and will have to use my student loan to pay for it leaving me penniless until January, however it would pay off my overdraft completely and because of this I am thinking of then closing the account and going to a "student friendly" bank such as Halifax and statring again on theire 500 pound initial overdraft. Is this reduction even allowed? If anyone can advise me about this situation I would be grateful.:rolleyes:
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monkey1984 wrote: »Today I received a letter from my bank (Nationwide) reducing my 1600 pound overdraft to 500 pound. They expect full payment in 3 weeks! I am currently a student and will have to use my student loan to pay for it leaving me penniless until January, however it would pay off my overdraft completely and because of this I am thinking of then closing the account and going to a "student friendly" bank such as Halifax and statring again on theire 500 pound initial overdraft. Is this reduction even allowed? If anyone can advise me about this situation I would be grateful.:rolleyes:
Of course it's allowed. I'm sure Halifax T&C's allow them to do whatever they like with an overdraft at any point.
Just a thought, but did it cross your mind to speak to Halifax before badmouthing them on this forum?
They might be able to help you out if you actually speak to them.
Just a thought...0 -
You are probably better off going to a student account with the HSBC or Natwest - rather than Halifax.
They are more likely to give you a 'decent' interest free overdraft rather than messing around with Halifax's initial overdraft which they may/may not increase
Regards
Sunil0 -
The Bank is Nationwide. Yes they can do it, personally I find it exceptionally unethical to demand £1,100 in 21 days regardless of T&C's. Then again, what is a bit of personal misery, loss of creditworthyness and costs as bills go unpaid when you've got T&C's on your side! Yes, I know that's cynical!0
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Thanks for advice. Have since set up a "repayment plan" where my overdraft goes down by £50/month.
Has left me disliking Nationwide intensely though, can't wait to finish uni and get it paid off for once and all!0 -
hi Monkey1984
just to let you know you are not alone, exactly the same thing happened to me at the end of August. My overdraft limit of £1900 was being reduced to £1400 three weeks later. I was more fortunate than you as my overdraft wasn't maxed out, I had worked to bring it down to about £1100 as I was going on holiday and had planned to use the remaining overdraft as spending money. It did leave me feeling rather differently about the Nationwide than I had done previously.
I have been a customer with the Nationwide for almost 20 years, had about 4 loans and a gold credit card and never defaulted, never went over my overdraft limit, so I am not impressed. If I thought there was any better out there I'd open a new account and pay my overdraft off monthly.
I did put it down to general concern about high levels of debt and the worry about people's ability to pay. It still doesn't make me feel any better about Nationwide.0 -
I've just received notification off my bank this morning that they are cancelling my overdraft all together and that I need to clear my £700 overdraft by 23rd December.....Not really what I wanted in the run up to Christmas:eek:
I've contacted them and asked if they can give me an extra couple of months to clear the overdraft but I'm not holding out for a positive reply.
How would I go about setting up a payment plan with them if needed?0 -
Same thing here.
LloydsTSB removed my £1600 graduate overdraft which I was paying off each month. They've put it back on now but with £300 of fees to go on in the next 2 months for the 10 days they didn't bother to tell me they'd removed it. Oh and I no longer have the £1000 interest free part so i'm going to be paying interest on the lot. So instead of taking a year to clear it it's going to take 4. Thanks LloydsTSB.0 -
Are all of you doing anything against the T&C's to provoke the banks into removing the ODs?
e.g. Not making regular deposits, not voluntarily reducing the graduate OD by the set amount each year etc...They say you can't put a value on life... but I live it at half price!0 -
If you are going to close the account make sure your new halifax account is up and running just in case they don't give you the OD you want. Also note they could do the same thing.
In the early days of my nationwide account it came with an automatic OD. I just used it all and wasn't seen to be depositing money every month as I had another current account where all my money went in and out and they quite quickly took it off me. Thankfully I had the money to pay it off. When I switched my current account over to them and when they saw all this money coming in they gave it back quite quickly. It might not help you but maybe if it looks like your account is sitting at -1800 all the time with very little money coming in they may be more inclined to take it off. There is nothing to say it won't come back in a few months.
Maybe get yourself another account but keep the nationwide open just in case. I know some people make sure their bills go out a few days after money comes in so it doesn't look like they have no money all the time (bills come in and out same day, you balance never seems to move). I'm not sure how effective this is.
Good luck0 -
If you are going to close the account make sure your new halifax account is up and running just in case they don't give you the OD you want. Also note they could do the same thing.
Just remember that in doing this you are effectively breaking the T&C's of one or both banks, as most banks stipulate that customers of students account may not have another student account elsewhere.They say you can't put a value on life... but I live it at half price!0
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