Overdraft craziness and the pursuit of not being in the red!

Erin89

Hi there,

I have trawled my way through the pages of topics and cannot find what I am looking for, so I must be a pest and ask you all myself!

Basically I am a student (I can hear the inhale of breath…) who has a Nationwide account with an overdraft of £600. I pay £30 a month in interest on this overdraft, and while, yes, you may wonder why I never got a student account, I must point out that my overdraft was a quick fix which I hoped to use for a short period a few months back. Also, Nationwide do not offer student accounts and at the time it seemed too much of a hassle to switch. Now, 3 months down the line I have found myself in the position of needing to pay a rather large deposit on a new flat and £600 in debt with my overdraft. Uh oh!

I am now in the situation where I cannot afford to pay off my £600 overdraft in the one go with Nationwide and the £30 interest fee is cutting into what few funds I have from my wages. Also, now I am beginning to pay my overdraft off and I feel like I just keep getting dragged back into the negative. I was hoping that if I was to open up a student account with another bank, I could take out a £600 overdraft with them, pay that sum of money into my Nationwide account and close my existing account with them. Then, I would still be in the same amount of debt, but I would find myself saving £30 a month, which I could use to pay my overdraft off in my brand spanking new student account! Genius! Most of my friends hold student accounts with RBS,who offer £1500 non-interest overdrafts to its customers. I went through the process of meeting an RBS account advisor, giving them copies of acceptance letters, old bank statements,etc,only to be turned down and told I was not a suitable client, as I was in debt to Nationwide.

I am confused, as I have been reading here that many people have more than 1 overdraft with more than 1 bank. How do you do this? Share your knowledge with me! A girl needs money to buy shoes, and I have just seen a gorgeous pair on Asos! Oh yeah, and that £600 overdraft needs paid off…

I thank you in advance, and help/advice would be a great help!

Erin.

LeeSouthEast

You are probably victim of 'lack of credit history', and the small history you do have, shows a history of being in the red. That'll be a red flag to 95% of lenders. You need to build your credit history up; try applying for a sub-prime credit card and using that for 6-12 months to get some history generating. Ensure you pay it off in full every month as the sub-prime APR's are horendous.

This won't help you in the short-term, but there are few short-term fixes for what is essentially, an industry-wide long-term problem.

Good luck.

jambosans

Are you sure you are paying that amount of interest on a £600 overdraft? It may sound like a daft question but according to the Nationwide Website the overdraft interest rate is 18.9% AER, which equates to £8.72 if the £600 overdraft is maxed out over a 30 day month. I didn't calculate this, Nationwide did.

There's not much you can do if another bank won't have you.

Erin89

Okay, that is grand. Thank you for your help

missile

:rolleyes:If it is not too much hassle :rolleyes:

You might want to look about for an account which offers a free overdraft, like A&L, get an RBS student loan or open an account with a bank who pays an incentive to switch e.g. Co-op offer £50.

You may or may not qualify for these, too much hassle for me to check