Halifax Overdraft Expired Without Notice

Sharon87

Thanks to this thread I know what I'm going to do. i'm going to write my review dates for my overdraft down in my diary (well, when I get next year's one lol), so I can make sure at this date I can get it clear. I will also check on the online banking, what the current 'guaranteed overdraft' is, as this will be a good indication whether or not it will be reduced or removed. Just a little tip for people approaching their review date.

Even if you're not approaching your review date still have a look at your guaranteed overdraft and if it's slightly more/less and you're happy with that, change your overdraft (whether it's by £50 or even more) then your review date gets pushed back to another year.

tiff

Moore71, keep us updated. Have you tried CAB or opened an account with a different bank?

Moore71

Hi there, we went to lloyds TSB and opened another account, they were fantastic, they werent able to offer us an overdraft and said that was probably due to the fact that the Halifax were standing over us like watchguards. We also checked out our Terms and Conditions and by the look of it if they have to give 30 days notice the same as we do if we want to change or amend anything on the account. As they have not even as yet not written to us to confirm that they have withdrawn the overdraft we are going to pursue this against the halifax. We will make a complaint and keep the Financial Banking Ombudsman in the loop. I dont think its relevant that we are semi permanently in the overdraft, if we didnt use it they would take it away and as we have used it they have taken it away!! We are not a risk as was mentired earlier in the thread, we are normal every day working people who use the facilities that our bank provides and I hasten to add actually charge us for. It is criminal that this can happen without so much as a by your leave or even a letter to advise us or asking us to contact them. its a no wonder that they are in the trouble they are in. I would never bank with them again.

opinions4u

We are not a risk

You borrow money.

Lending money to anybody carries an element of risk.

Mikeyorks

Moore71 wrote: »

I dont think its relevant that we are semi permanently in the overdraft ......... if we didnt use it they would take it away

It's very relevant that you make significant use of the overdraft. When you're £2800 into a £3000 overdraft and can't repay on demand .... you're a risk. Read the (fairly recent) multiple threads from others in a similar position to yourselves .... where Halifax have suddenly pulled the overdraft rug from under their feet. As I said in my previous .. Halifax have suddenly discovered 'responsible lending', a bit late in the day. And it's people like yourself who regularly use / need the o/d facility who are going to suffer from the revised direction.

Getting a loan and where you can dictate the repayment terms is probably a sensible way for you to ease yourself out of the overdraft. And converting your account away from the Ultimate ... where you pay £150 pa for benefits you probably don't need ... also makes sense?

I've had a £1500 overdraft on my Halifax current account for years. It's never used ... but it's still there .... just as a backstop in case I drop the ball on an account I now run with a very low balance in it.

Moore71

well if there is anything to be gleened from this is that the banks seem to be holding the strings, we are just puppets in the game. I would never ever go near the Halifax again, I avoid even using their cashpoints now. I will let the Financial Ombudsman deal with them, they have a case to answer and they wont be able to wriggl out of this. I have no objection to repaying the overdraft, its the fact that they have gone about it in such a forceful manner, we are getting letters every week reminding us that we have topay £x on a certain date or they threaten us with charges!!if anyone wants to throw any advice please feel free because at the moment I am numb from the neck down.

jambosans

Unfortunately Halifax Bank of Scotland deem the review date printed on every statement adequate notice. An overdraft review date is the point when the bank decides to either: continue, increase, reduce or remove your overdraft facility, so it is something you should technically be prepared for. If the overdraft were to be removed, reduced or increased earlier than the review date, then written notification would be required. If you were living in your overdraft then I would imagine the bank (under a tightened lending policy) deemed your account conduct/ internal credit score not good enough to maintain that level of borrowing.

I agree that the review date on your statement may not seem like sufficient notice but ultimately an overdraft is a form of lending from the bank and they are within their rights to demand repayment at any point. I would have thought that a bank in financial difficulties itself would appreciate how removing an overdraft (with only a review date as notice) can have the same effect on it's customers.

The best advice I can give HBOS customers is to check your review date for your overdraft, and closer to that time contact the bank to see if the borrowing can be extended for another 12 month term. If the answer is no then that does not necessarily mean the overdraft will drop off on the review date as underwriting may decide to override the system's decision. HBOS has strict overdraft appeal criteria which most customers will not meet, so it may not be worth pursuing this, but you can certainly ask about it. Put in place previsions to repay the overdraft before the review date - consider paying in more money, or possibly (as others have said) applying for a loan. In terms of a small personal loan, you may find yourself better financially off in terms of interest as overdraft interest rates are amongst the highest when compared to things like loans and credit cards.

If you feel the worst is about to happen, and the overdraft is going to fall off without you having the ability to repay then speak with HBOS Money Management. This internal department of HBOS is there to help customers who are *not* in arrears but may be heading toward financial difficulties. Now, they do not work miracles, basically they take you through a list of set questions to assertion what's going in and out of your bank account and provide suggestions on possible ways to streamline your finances. They will not sell products or advise you to take out a loan but will point you in the right direction. It can be quite daunting because in some cases they will suggest speaking with a debt management company like ThinkMoney. ThinkMoney provide free debt advice but ultimately will try to sell you products unless you are referred through HBOS Money Management - they may still try to sell but at a preferential rate.

If the overdraft does fall off your account then, like the examples given your account will go into arrears. Normally after a few days in arrears the account is placed under HBOS Head Office control, scary though this may sound it is ultimately Collections/ Arrears/ Get Our Money Back. You have to keep an eye on your account, because again, like the examples on this thread lots of charges can occur if the arrears are left unchecked. Oddly H/O does not always write to customers to advise that have went into arrears, that's normally left for the customer to discover on charge letters or statements. As soon as you see the account is in arrears, contact H/O - just call telephone banking and they will transfer you through. H/O will then normally agree a repayment plan and stop further charges, but, as with the examples, the terms are often high monthly repayments that not everyone can afford. If you cannot negotiate down the amount repayable each month then contacting a debt management company may be your best option. By this point your credit rating should be sufficiently destroyed which will probably stop you from getting a loan with HBOS or any other lender.

Overdrafts are not a right and with credit drying up people need to realise that it is no longer "free money" and will have to be repaid at some point. I wish the best to those pursuing this through the Financial Ombudsman but on a closing point, specifically to Moore71, most Ombudsman will only handle a complaint if you have followed the complaints procedure with the bank. Your complaint is specifically about the inadequate notice given by the Halifax and you have to correctly raise this with them. Every bank has an escalation process for complaints that must be followed to completion before the Ombudsman will take over the complaint. Basically you need to escalate a complaint with the Halifax and if the resolution they give you does not satisfy yourself then you can take it to the FO. I personally think it is fruitless because Halifax will claim the notice given on the statement is sufficient and that by definition a review can include withdrawal of the overdraft facility. Also, be under no illusion that a complaint will somehow result in the debt being lifted or the payments being reduced, at the most any charges may be reimbursed or some advice will be given to HBOS by the FO. Regardless, good luck to yourself, it is a long drawn out process but if you have the patience I would see it through as it should bring the matter to a close.

Finally, other banks have similar lending and debt collection processes in place, so changing bank wont stop you from having to pay back an overdraft on demand. Although Lloyds TSB do write to customers to advise if their overdraft facility is being removed which is something HBOS may have to adopt under the new Lloyds Banking Group umbrella.

Moore71

Many thanks for your comments, they have been the most helpful to date. My husbans has today been into the branch to discuss the repayments and has been told that he needs to pay 10% of the overdraft, which started out at £3k but will reduce monthly. He has also been informed that to reduce the payments we would have to default on the account which clearly we are not prepared to do. Another suggestion from them was to freeze the account and then attempt to enter into a more rational payment scheme. We will write everything down and make a formal complaint. A review date is not notice of withdrawl, it is a review date, and that cannot be ignored. I still cannot help thinking that they have to give the same notice to change something in our account as we do to them if we want to close / amend the account. There must be a clause somewhere which prevents them from just pulling the rug out from under their customers feet the way that they have. It would have been better if they had contacted us and discussed it reasonably and come to a conclusion that suited both the bank and their customers. We now have an account with LLoyds TSB with no overdraft and to be honest we would never have one again. They have blown our credit rating which means that we are risk lenders - why would they do this? Its totally beyond my comprehension as its unnecessary.

simax

You know Halifax and Bank of Scotland are now owned by Lloyds TSB don't you? Their systems at the moment are not linked together, but as soon as they are, be prepared for "The Right of Offset" :eek:

Mikeyorks

Moore71 wrote: »

A review date is not notice of withdrawl, it is a review date, and that cannot be ignored.

And a 'review' can conclude ...... "remove the overdraft" ..... can't it?

However ..... could I suggest you read the attached, it may be helpful (despite you're very selective as to what is considered help)? With particular reference to the last couple of sentences :-

http://search.moneysavingexpert.com/search?q=cache:0yC6qPIA7xcJ:www.moneysavingexpert.com/banking/news/2009/04/banks-caught-cancelling-overdrafts+overdraft+review&access=p&output=xml_no_dtd&ie=UTF-8&client=msecom_livesept08&site=default_collection&proxystylesheet=msecom_livesept08&oe=ISO-8859-1

Halifax says it reserves the right to reduce your overdraft limit at the annual review but insists, if you’re overdrawn at the review stage, it never knowingly reduces the limit below that of your balance.
A spokesman adds: “In Mr Corner’s case, we made a genuine error and we have sent him a letter of apology. If this has happened to any of our other customers we ask them to get in contact with us.”

......however, as your overdraft appears to have been re-instated, despite after a worrying period and solely to allow you to pay it down ..... I do suspect a complaint to the FOS isn't going to do much more than make up the numbers.