Paying back HSBC Student Overdraft

Levster

Hello. I got a student overdraft account of 1000 in September of this year, which is supposed to increase with each year of uni, however my course was only a year long so I will be canceling it very soon.

Does anybody know how you can go about paying this back? I am broke and am going to start full time work in a couple of weeks so will be able to manage but don't want to be completely raped of money by them. Is paying it back easy and fairly unnoticeable, a bit like the student loans from the government?

Thanks!

jpwjpw

If its a student account it'll probably be 0% interest for a few years. As long as you pay in some money now and again, you should be able to keep it for years and not pay interest. Then you can pay it back when you have the money.

Levster

That sounds awesome! Will it change back to a normal account though? In September when the new student year starts?

jpwjpw

Why would you want to do that? Usually, the only difference is that banks don't charge interest on overdrafts on student accounts, but do on normal accounts.
Therefore, you don't need to notify them, just keep using your account as normal

Levster

I thought because I'm not a student anymore they'd close it but I shall just keep it open. However, wont they try to find out if I am doing a second year? The overdraft also increases in the second year which I don't really want, will they ask if I want it increased or just do it automatically?

lyndasharp

I don't know about HSBC specifically, but I had a student account with Halifax. They wrote to ask for proof of student status each year, and without the proof when I stopped being a student I got the next year interest free, before it changed back to a standard account. I don't imagine HSBC will take the overdraft away or start charging without letting you know, you'll probably be getting a letter quite soon.

GrammarGirl

The T&Cs of your HSBC student account stipulate your loan must be paid in for you to qualify for the student account rates. So when it doesn't, they may contact you to ask why, close your account and demand payment, change it to a regular current account or they might not notice and let it continue. I've seen all outcomes, and in fact, my boyfriend graduated last year but has been kept on a student account for an extra year, rather than being automatically transfered to a graduate account.

merzal

I was a student for 3 yrs, my overdraft started at 500, increased to 1000 in the 2nd year, then 1500 in my third. I then went into the bank and changed in to a grad account (no charge) the first yr after grad the whole lot was interest fee, the 2nd year was 1000 interest free and now it is 500 interest free. So I have just paid off 500 a year to keep it interst free. Hope that makes sense. So will pay back the last 500 during the next year and then I assume it will turn into a normal account. You do need to pay some each month tho (although u can take it out again), I forgot for about 6weeks and got a very threatening phone call demanding I pay in full all they will send the bailiffs round! Best thing to do is ring / go into the bank and see what they say!

jpwjpw

they didn't check to see if i was a student every year. As long as you are paying some money in then i'm sure they'll do nothing. I wouldn't ask the bank as they'd most likely take the interest free overdraft away. If they do notice you've lost nothing, they'll just write you a letter to start charging interest.

My hsbc overdraft stayed interest free for 3 years after I graduated anyway (they automatically converted it to a graduate account)

They will probably automatically increase the limit, so you will need to contact them if you don't want them to do this.

jpwjpw

GrammarGirl wrote: »

The T&Cs of your HSBC student account stipulate your loan must be paid in for you to qualify for the student account rates.

I can't find that in the T&Cs, is that true? Some students don't take the student loan but i'm sure that doesn't stop them getting an account.