Informal/formal overdraft arrangement fees

joebloggs69

Hi,

I think I'm being done over by HSBC!

I went overdrawn and went into the bank to ask for either a small extension on my overdraft or for them to give me a few days lee-way as I was due to be paid. The chap there said I shouldn't be charged as long as I was due to be paid within a few days, he also gave me his business card and told me to ring him if they do charge me.

Later that day I had a phone call from HSBC call centre warning me I was overdrawn. I explained the situation, and the bloke asked if I was interested in an extension on my overdraft - I said it would be helpful and agreed to the £25 arrangement fee. After taking a few details he then went and spoke to someone and came back and told me they could not extend my overdraft at this time. Never mind. I guessed it was because I was already over my current limit.

The following week, after I had been paid, I discovered a problem with my wages and decided to apply online for an extension again just to make sure I wouldn't keep getting charged - I thought I might now be accepted since I was now no longer over my limit at the time of application, I was correcte and was accepted. My online details now reflect this new limit. Again, I agreed to a £25 arrangement fee.

I have now logged into my account to see a message saying charges of £75 are due to be applied to this account. £25 informal overdraft arragement fee, £25 formal overdraft arrangement fee, and £25 debit interest.
Ouch.

I haven't phoned the first chap back yet, as I trust you guys and would like your advice first. Does anyone know the difference between the two arrangement fees? Does it mean I have to pay the 1st one even though I was declined, or do you reckon it's a mistake?

Thanks for reading my essay,

Joe

esmerellda

The first charge ( informal arrangement fee ) will be for being over your overdraft last month. the second (formal arrangement fee ) will be for arranging the overdraft extension that you did online. The third (debit interest) sounds wrong or high and more like a monthly overdraft charge? (which again would have been for the first month when you went over without getting the formal arrangement)

does that make sense?

joebloggs69

Thank you, that makes a bit more sense. I know sometimes banks charge for each 'overdrawn' item on your statement, so maybe it's that. Time to give them a call I think.

Thanks for the advice.