Graduate overdraft expired. What next?

hgnsvd

Hi,

I had a student account while at Uni and in the years since graduating have not paid off my overdraft. My year with a graduate overdraft has now ended so I'm paying about £15-20 in interest every month for a £1500-2000 overdraft.

I'm unemployed at the moment and my credit score must be awful. What should I do? Can I just continue like this, or would have terrible consequences? There's no sign that I'll be able to quickly pay off the overdraft so I need to think longer-term. Maybe I should get a loan, but who on earth would loan me money?

Thank you!

BASFORDLAD

Prehaps you shoudl of thought of that before you went to uni thinking "ill get a degree then walk in to a good job"

CLAPTON

it would seem that your OD interest rate is quite reasonable.

no-one will give someone without income a loan (well not at a sensible APR)

unlesss your bank is causing problems just continue paying something each month and keep within your overdraft limit.

hgnsvd

Thanks Clapton.

So I'm not irreparable damage to my credit score by letting things keep ticking over for the time being?

My last statementy thing says "The current unarranged rate which applies is 2.19% per month, effective annual rate 29.6% or other rate agreed with you."

Is the 'unarranged' bit anything to worry about?

Thanks again.

CLAPTON

That doesn't seem right... surely you have an agreed OD or are you over your limit?
However, lots of banks have rearranged and reworded their OD conditions due to all the problems with 'illegal' bank charges.

The real danger with ODs is that they can be rercalled at any time but until you increase your income I don't really see you have much alternative.

(2.29% per month should mean you are paying 30-40 per month in interest if you are overaging 1,500-2,000 per month OD)

hgnsvd

I know that my student OD was £2000 and I assume that just carried over. I don't really understand all the terminology.

The bank have never written to or called me about it. Oh god. I hope something awful hasn't happened.

crispy_chris

I feel you may have been sort of sticking your head in the sand a touch.

Give your bank a call, if you feel you're in financial trouble talk to them about it, they may be able to help you sort things out. Its far better to go to them as opposed to them chasing you.

GrammarGirl

Which bank are you with? It sounds like the interest free period of your OD has ended but you still have a graduate interest rate, which is really low.

Are you keeping within your limits and paying the charge each month? If so, you're doing nothing to affect your credit rating and shouldn't worry too much.

Definitely give your bank a call and get definite answers as to your OD limit.

CLAPTON

most bank statements and/or the online bank details tell you what the OD limit is.