Interest question

MissCW

Sorry I have had a search of the forum but can't find an answer to my query for this one.

Me and Natwest are disputing the figure of my claim, they wrote to me saying that the offer they sent me reflected ALL my charges. Because their figure was so different than mine, I rang them to ask why it was so different and they said they had removed all the figures for interest as I wasn't legally allowed to claim it.

This isnt interest I have charged on the charges like Martin's interest calculator, it is interest figures they put on the account when it went into the red because of the charges and I couldnt keep up. They wouldnt freeze the account either even though I asked them to at the time. Because this was interest they had charged on their charges (it was being applied in monthly amounts before the account was finally defaulted) I thought I was OK to claim this back? I won't ever physically see this money but I would like it come off the figure that I was defaulted for. It does add up to quite a large sum.

Has anyone any experience of this, or can I genuinely legally not claim it? Thanks!

willo65

as far as I know interest isn't charged on charges, if you were for example o/d by £1000 and £300 was charges then you would have had interest on just 700 and then if you pay in £300 this will cover the charges so you will still get charged interest on £700 if this makes sense.

Orford

willo65 wrote: »

as far as I know interest isn't charged on charges,Where on earth did you get this from? You will be charged interest on the whole overdrawn balance , irrespective of whether it comprises of overdraft or charges or both
if you were for example o/d by £1000 and £300 was charges then you would have had interest on just 700 and then if you pay in £300 this will cover the charges so you will still get charged interest on £700 if this makes sense.

Utter rubbish

MissCW

Hi Orford - or anyone else!

Does this mean I am entitled to ask for it to be included in my claim? I'm still not sure from the replies .. Thanks again.

Orford

MissCW wrote: »

Does this mean I am entitled to ask for it to be included in my claim?

Yes, you can , but only the portion of overdraft interest that relates to charges. For instance using Willo65 example, you could only claim the interest on £300. But, of course that's very simplistic.
The reason most people don't is that since interest on statements is just one figure it is extremely difficult separate the two and to accurately calculate the interest on just charges alone.

willo65

Orford wrote: »

Utter rubbish
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From Natwest Terms and Conditions:

"6.6.5 We will not charge interest under General Condition 6.3.5(b) or
6.6.2 on any part of an overdrawn balance which represents:
(a) a Default Notice Fee or other sum (apart from interest) which
is payable by you in connection with a breach of your
obligations under your agreement with us; or
(b) a Maintenance Charge, Paid Referral Fee, Guaranteed Card
Payment Fee or Unpaid Item Fee."

From Natwest Guide to Fees and Interest:

"However, we
will not charge interest on any part of the overdrawn
balance which represents fees, charges or costs of the
kind described below under the heading Sums which
do not bear interest."

natweststaffmember

willo65 wrote: »

From Natwest Terms and Conditions:

"6.6.5 We will not charge interest under General Condition 6.3.5(b) or
6.6.2 on any part of an overdrawn balance which represents:
(a) a Default Notice Fee or other sum (apart from interest) which
is payable by you in connection with a breach of your
obligations under your agreement with us; or
(b) a Maintenance Charge, Paid Referral Fee, Guaranteed Card
Payment Fee or Unpaid Item Fee."

From Natwest Guide to Fees and Interest:

"However, we
will not charge interest on any part of the overdrawn
balance which represents fees, charges or costs of the
kind described below under the heading Sums which
do not bear interest."

How does the bank's computer systems know that an amount debited is charges and not to charge on that amount? Surely a computer programme is written to charge debit interest on a total amount rather than an amount less a variable amount?
I know it says the above but when was the last time that the terms and conditions were amended since the claim will be from July 20001? Those terms came in much later so interest will have been charged up to that amendment.

willo65

natweststaffmember wrote: »

How does the bank's computer systems know that an amount debited is charges and not to charge on that amount? Surely a computer programme is written to charge debit interest on a total amount rather than an amount less a variable amount?
I know it says the above but when was the last time that the terms and conditions were amended since the claim will be from July 20001? Those terms came in much later so interest will have been charged up to that amendment.

I'm not sure, I don't work in I.T. but I seem to remember reading this when I first started at the bank a number of years back.

natweststaffmember

willo65 wrote: »

I'm not sure, I don't work in I.T. but I seem to remember reading this when I first started at the bank a number of years back.

It might have been a couple of years but it was post OFT test case announcement. I remember that part of the test case, I would suggest that the OP applies the rate of 8% interest then since a judge would not want to get bogged down by the question of which bit was overdraft interest and which bit was not overdraft interest.

MissCW

Thank you everyone.

So the two members of Natwest staff had it wrong when they said "legally" I had no right to try and claim this interest? They were pretty aggressive with me as a matter of fact.

Does anyone know how I could word a letter to say that actually I am entitled to this.

I've already said in another letter I would accept their offer as an interim payment pending the result of the test case as people suggested earlier but they are just ignoring me and keep sending me this form to accept it in full and final settlement.

I really don't know where to go with it from here.

natweststaffmember

MissCW wrote: »

Thank you everyone.

So the two members of Natwest staff had it wrong when they said "legally" I had no right to try and claim this interest? They were pretty aggressive with me as a matter of fact.

Does anyone know how I could word a letter to say that actually I am entitled to this.

I've already said in another letter I would accept their offer as an interim payment pending the result of the test case as people suggested earlier but they are just ignoring me and keep sending me this form to accept it in full and final settlement.

I really don't know where to go with it from here.

The bank CANNOT offer any amount in charges under financial hardship as a full and final settlement of a charges complaint. Keep the letter as it is and if they verbally tell you that you cannot claim interest once the OFT test case is over then so be it. The bank WILL NOT pay out interest on a bank charges claim under financial hardship.