No Fee A & L Overdraft for a Year !?

tekie

Hi, I've got a pretty good OD arrangement worth 4k with Natwest and now A & L is offering me to match that OD if I switch my account plus for the first year there's no interest and no fee.

Their terms and conditions are pretty straight forward I need to show my current natwest account in credit for at least 15 days at the time of switch, which I can easily manage.

What I'm planning to do is to pay off my credit card bills using the new OD coz it looks like free loan wihout any interest/fee to me

Is it a real deal or is there any loop holes in there...I'm not worried about the direct debit swithcing and related stuff

All I want to know fom you guys is whether its a good deal or is there any catch.

ShelfStacker_3

How exactly do you plan to pay off the overdraft?

tekie

I'm planning to user up 75 % of the overdraft and will clear of that in parts, like a loan. In effect I'll be kind of overdrawn for the whole year not in full but again clearing the debt in installments...

ray123

A word of advice, while a & l might promise to match your overdraft, this is most likely subject to a credit check!

I applied for them to match my OD of 9k and they refused to even increase it from 250 pounds!

fanheater

tekie wrote: »

Hi, I've got a pretty good OD arrangement worth 4k with Natwest and now A & L is offering me to match that OD if I switch my account plus for the first year there's no interest and no fee.

Their terms and conditions are pretty straight forward I need to show my current natwest account in credit for at least 15 days at the time of switch, which I can easily manage.

What I'm planning to do is to pay off my credit card bills using the new OD coz it looks like free loan wihout any interest/fee to me

Is it a real deal or is there any loop holes in there...I'm not worried about the direct debit swithcing and related stuff

All I want to know fom you guys is whether its a good deal or is there any catch.

there's no catch at all. even once the interest free first year is up, you'll still only pay £5 'interest' max on the overdraft

masonic

You will need to show A&L your latests account statement showing your existing account has been in credit for at least a few days when applying for the overdraft matching. If you can do that, then this is a very good deal.

As fanheater says, even after the first year overdraft interest is capped at £5 per month, so you're effectively getting a rate of 1.5% if you max it out. That means you can 'stooze' the money in a savings account and earn more interest than you're paying on the overdraft.

So instead of gradually paying the overdraft off, you could put that money into a regular savings account, keeping the overdraft maxed out, then leave that money earning interest until you decide to use it to pay off the overdraft in full.

mumof2girls_2

How do they deter the amount of O/D granted?

Im with BOS at the mo with a 1.5k overdraft, which I live in most of the month-I wouldnt want just a £250 O/D. :rolleyes:

masonic

mumof2girls wrote: »

How do they deter the amount of O/D granted?

Im with BOS at the mo with a 1.5k overdraft, which I live in most of the month-I wouldnt want just a £250 O/D. :rolleyes:

You're unlikely to get £1.5k without using the overdraft matching service. The standard overdrafts offered are not very generous.

byebyedebt

Hi, I used to have a 6K overdraft. Alliance and Leicester matched it for a year. However at the end of the year I was told that they expected to see an income of double the amount on overdraft being passed through the account, ie 12K. As I didn't have that the overdraft was cancelled.

So, be aware that they will cancel the overdraft unless you have an income 2x greater than the overdraft amount.

Also, I thought they had switched to a 50p per day (£15 a month) fee basis.

masonic

byebyedebt wrote: »

So, be aware that they will cancel the overdraft unless you have an income 2x greater than the overdraft amount.

I don't think that is true as a general rule. Having said that, you need to cycle £6000 per year through the account to avoid the underfunding fee, so anyone with an overdraft of £3000 or less would already be meeting that criterion.

Edit: Also, there's nothing to stop you batting the same £250* back and forth by faster payment as many times as is necessary to pass the required amount through the account.
*(A&L's faster payment limit)

Also, I thought they had switched to a 50p per day (£15 a month) fee basis.

It's 50p per day capped at £5 a month.