BBC Three: How to Rob a Bank!! (Student Debt WARNING)

ScottyBoy_2

Has anyone seen the BBC Three program "How to Rob a Bank" about Student Debt.

Go to BBC iPlayer and watch it, really interesting and eye opening.

Lokolo

Watching it now

LauraF_3

I was absolutely horrified. No wonder so many people struggle with debt if it's thrown at them in this way!
Immediately after watching I considered taking out as many student overdrafts at 0% as I could and putting it into a high interest savings a/c, but it hardly seems worth it the way the rates are going now. :xmassmile

TDQO

Natwest kept offering me 24k loans all through my first year!! I'm so glad I didn't take them or I'd be in deeeeeep poo now.

lcharm

Just watched this now. Messed up

I was at Uni around the same time. If i'd known I would have loved to have had lots of 0% overdrafts to put into a cash ISA or high interest account

Funny how both the students shown were both drama students, i supose it needs a certain element of good acting involved!

http://www.bbc.co.uk/iplayer/episode/b00fvc73/How_to_Rob_a_Bank/

whitfreak

Isnt lying to your bank to get money technically fraud? Thus the "outlandish" statement about him going to prison isnt so outlandish. What confuses me the most is the fact that they could open both rbs and natwest accounts, I thought they used the same computer systems....

Might be cus I went to a ""proper"" university, but all of my mates understood that overdrafts had to be repayed in the end. Yes some of them had money problems (a couple even had multiple overdrafts) through drinking and buying too crap much but they did so knowing that the banks would chase them if they didnt repay it at some point. Maybe we do need a keyfacts document for student accounts that points out that overdrafts are debt (repayable on demand), rather than losing that fact among the railcards and true free money.

Mike1989

whitfreak wrote: »

Isnt lying to your bank to get money technically fraud? Thus the "outlandish" statement about him going to prison isnt so outlandish. What confuses me the most is the fact that they could open both rbs and natwest accounts, I thought they used the same computer systems....

Might be cus I went to a ""proper"" university, but all of my mates understood that overdrafts had to be repayed in the end. Yes some of them had money problems (a couple even had multiple overdrafts) through drinking and buying too crap much but they did so knowing that the banks would chase them if they didnt repay it at some point. Maybe we do need a keyfacts document for student accounts that points out that overdrafts are debt (repayable on demand), rather than losing that fact among the railcards and true free money.

I think the reason some students take out multiple accounts is for one of two reasons, we could argue more but I look at it in two ways;

1. They are living away from home, need to pay rent, need to pay for things, and as such need money. They get a grant and loan which might just pay for rent and food if they are running on a shoe string budget. So they need an account that has a good overdraft to tide them over, some need two so they can get by. And having known students like this, they all know regardless of the university they attend (proper or newer) that it needs paying back.

2. The other one is those who take out one or two accounts, maybe more, to place the interest free overdraft into a savings account. That way if they can find a nice fixed rate savings account, with a high rate, they can make a few hundred quid. Example 3 accounts with 2,000 overdrafts, 6,000 put into a 6% savings account pulls £360 a year. Rather tempting way of making money and paying back the interest free overdraft at the end of your studies. If each year you make £360 plus interest on the interest, your in line to make a free thousand pound.

I don't think class of university makes you any more aware of what an overdraft is, when it needs to be repaid, or how well it is used. To be fair, I would assume that most university students realise they need to pay back their overdraft. Admittedly some on here have come along and not realised what their limit is for the first, second or third year, some have not realised that the overdraft can be reduced by the bank's decision to, and that it can be asked to be repaid upon demand. But generally that affects those who are using it for "1" rather than "2".

I think that an information leaflet would not be much use. As the information regarding repayment, what can happen to your overdraft etc, is all featured in your terms and conditions. You don't need to read it, as most realise what they are getting in for, otherwise it beggers belief how they got to university in the first place if they didn't realise an overdraft needs to be repaid... But the reason banks focus more upon the freebies is to get that student through their door rather than their competitors door. They assume that the customer realises that they are taking out an account with certain terms and conditions, that if they use the overdraft is needs repaying, it is not their job to hold the customers hand.

whitfreak

Mike1989, I agree about the type of university doesnt matter, hence the double quotes around proper...

I would hope those who need a second overdraft to pay for there studies, have gone to their uni's finace/welfare office first to see what hardship loans/grants they can get first. Its cheaper in the long run. But it is understandable why would try and get a second overdraft its cheaper than a credit card after all.

Those doing deficit banking properly (with multiple overdrafts), more power to them. Although I still consider knowing lying to a bank to get credit to be fraud.

Considering the numbers of posts I've seen on here and other places about the shock at finding out how much "interest" there is on student loans and alike, I think is is actually more reasonable to assume that new students know less about money than we think. I was fortunate to go to a school where most student went on to university, so they did spend a couple of lessons explaining student finace, the basics of budgeting etc. I dont know how many schools do this. I'd hope that all schools covered the more general stuff at some point.

Banks do not help themselves or students though, for example, in my first year (back when hsbc had the railcard and natwest were giving people £50 to sign up), the natwest guys did encourage some people to get a second account with them just for the money, say that you could just close it only you'd got the money. How many did? Such problems arise when bank staff have sales targets to hit, rather than being allowed to concentrate on providing a service.

Mike1989

Back in my old college during the personal tutor sessions, although boring and tedious, I had to wait from 10 until 2 for the session which I had to attend otherwise no ema. They went over the things that happened at uni, the applying stage, the cost, the grants and loans available, and it did help further our understanding. As at first I didn't realise there was a free grant. But those lessons at least gave me an understanding of that. So I suppose it they use the personal tutor lessons, if most colleges have them that is, to help students understand what uni is about and the costs. That might help them.

Also I went to a thing called flying start that my uni runs. That in itself is helpful as you get lots of useful information from tutors and mentors at different levels of study some finished level 1, 2 and some had graduated that year. So the seminars we had and lectures on those four days were very useful in helping us understanding budgetting, what help was available, and generally setting you up for university life. Even those who don't go were provided with the relevent information about help available and there are regular emails sent out with student messages and guidance, if you read them you find out the different messages regarding help, emergency loans etc. Really useful.

To be fair the interest on the loans is generally stressed in college, I know we had at least two or three different university salesmen (not the right word) came in and gave advice on that uni whilst trying to remain as impartial as possible. Also there was someone from the SLC or local council that came in to give a talk about fees, grants, loans etc. So it should be covered at college, admitted some don't attend it and skip the thing, some don't listen, but those who do generally know what the fees are.

jj345

hey i'm confused but very interested. I'm a student myself, is it illegal to take out 2 student overdrafts, I'm currently with natwest, but money is very tight at the moment and i have bills to pay. Would it be ok for me to take out a hallifax overdraft student account aswell. I do realise this is a loan and i would have to pay it back and i would after i graduate. please can someone get back to me. xx

Willowx

jj345 wrote: »

hey i'm confused but very interested. I'm a student myself, is it illegal to take out 2 student overdrafts, I'm currently with natwest, but money is very tight at the moment and i have bills to pay. Would it be ok for me to take out a hallifax overdraft student account aswell. I do realise this is a loan and i would have to pay it back and i would after i graduate. please can someone get back to me. xx

No it is not illegal to have two (or more) overdrafts, but you should read the T&C's of the accounts some may specify that this should be your only or main account. If you go against these terms then your accounts could well be closed, it is also worth bearing in mind that overdrafts have to be paid back at the banks demand so don't borrow large amounts if you cannot pay them back.