opned student bank account how to use overdraft?

surfsister

Hi daughter off to uni and has opened her student bank account and finace will go in at end of Sep. Her student account has an overdraft but none of us ever go overdrawn so she's not sure how to use it.

Can she now overdraw and not incur any charges or must she wait till the student loan goes in?

Also can she be overdrawn for long periods ie write a cheque and put iit n a savings account? We're not sure how best she should operate? Thanks for amy tips.

surfsister

have seen the other posts on this thanks guys.

http://forums.moneysavingexpert.com/...html?t=1151911

bowdeni

Providing that you have the student loan going into it, then you can can use the overdraft for savings. However, the bank will be pretty fair to close the account if there is a lack of activity. I know Natwest are pretty keen to close accounts that break t&c.

windra

This is my experience so far...

I am with lloyds TSB and have a #1500 overdraft, my 'available' balance is 1500+ whatever money is in my bank.

You can use the overdraft as if you had that amount of money in the account, and as it should be 0% interest for students, incur absolutly no charges up to 1500 overdrawn.

Most students take the overdraft and put the whole lot in an ISA,earning some nice interest on it.

I didnt use my overdraft for 9months,just my bank account and then as my bf couldnt get to his savings bond, used the 1500, and have been overdrawn by about 1400 for three months with no problems,no letters or anything.

HOWEVER be careful not to go over the overdraft...they wont stop you! I ended up 1600 over drawn, they sent me a letter saying i would be charged #15 a month + 6 per day in charges,however i called them and got the overdraft extended temporarily for 28days and they cancelled the charges.

As long as she uses the account with the overdraft regularly i see no problems, and if she does get into debt you have a year after graduation to pay it off, so yes you can be overdrawn for long periods of time.