Credit Card Balance

follyfoot

Is it possible for a bank to debit my current account for an outstanding disputed balance on a credit card? they seem to think they can debit any account held with them.

LeeSouthEast

Correct. This will be in your terms and conditions under the heading of "offsetting" or something along those lines.

follyfoot

does this also apply to saving accounts? I cannot check the agreement i signed since i do not have the paperwork and the bank did not keep a copy

thriftymomma

I think it does yes.

Paul_Herring

If you hold both debt and credit with a financial institution, there is a a high liklihood that the contracts you signed allowed the banks 'right of offset,' in that they are permitted to 'raid' your credit facilities in order to pay off any debt you're not paying off.

They should typically, however, tell you they're going to actually do it before they do.

So yes, they can use your savings to pay off your credit card.

As a result of this, it's usually wise to have your current account and savings with a different bank to your mortgage and credit cards, if you think this is going to be an issue.

follyfoot

Paul_Herring wrote: »

If you hold both debt and credit with a financial institution, there is a a high liklihood that the contracts you signed allowed the banks 'right of offset,' in that they are permitted to 'raid' your credit facilities in order to pay off any debt you're not paying off.

They should typically, however, tell you they're going to actually do it before they do.

So yes, they can use your savings to pay off your credit card.

As a result of this, it's usually wise to have your current account and savings with a different bank to your mortgage and credit cards, if you think this is going to be an issue.

i would like to confirm this but the bank does not have a copy of the agreement i signed although they did say it was in the T&C i signed. can they offset and put me into debt on my current account?

Paul_Herring

can they offset and put me into debt on my current account?

Unlikely. All they'd be doing there is just moving a debt.

The whole point of 'right of offset' is to offset a debt by using a credit balance.

never-in-doubt

Quote:
can they offset and put me into debt on my current account?

Paul_Herring wrote: »

Unlikely. All they'd be doing there is just moving a debt.

The whole point of 'right of offset' is to offset a debt by using a credit balance.

I thought the OP stated it was from savings account, so that wouldn't allow a debit balance...

The fact no agreement can be found is irrelevant though - unfortunately this cannot be used as unenforceable, it could if you default the account and then they cannot supply a CCA but that's a risky game to play as your credit file will be screwed for 6yrs!

Paul_Herring

never-in-doubt wrote:

I thought the OP stated it was from savings account, so that wouldn't allow a debit balance...

The OP did indeed state in their first post that it was a savings account. (Which, I would assume, would have more money in it than the debt under consideration.)

Then they asked about their current account.

follyfoot

the account they debited was in fact a current account. but i also have savings so I was just wondering if they could have taken my savings since the current account was overdrawn at the time which just pushed it further into the red.

naijapower

Well, they could take from any of your accounts. Not sure why they chose your current account which has made you more 'red'.