Halifax £1 per day charge for using authorised overdraft? Will others follow?

apt

If you have two separate Halifax current account and use an overdraft you should make sure that the overdraft is concentrated on one account providing the total is under £2,500. E.g. two overdrafts of £400 will incur twice the charges of one overdraft of £800.

rattla

apt wrote: »

If you have two separate Halifax current account and use an overdraft you should make sure that the overdraft is concentrated on one account providing the total is under £2,500. E.g. two overdrafts of £400 will incur twice the charges of one overdraft of £800.

Yeah - Only one of them gets its overdraft used to be honest - the other is just like a 'shopping' account.

If I do go overdrawn by any small amount though, I'd want to go and withdraw £2,499 to maximise the benefit of the £1 fee

Yogicat_2

For those unhappy with the new overdraft charges introduced by Halifax, log onto www.consumeractiongroup.co.uk/forum.

They have template letters if you wanted to complain to Halifax, OFT, local MP's etc, even a Petition for No. 10 is in the process of being set up.

Hope this is helpful to some

Yogicat

sabretoothtigger

rattla wrote: »

Yeah - Only one of them gets its overdraft used to be honest - the other is just like a 'shopping' account.

If I do go overdrawn by any small amount though, I'd want to go and withdraw £2,499 to maximise the benefit of the £1 fee

Yea I worked that out, I think its like 14.6% apr
To be fair that is actually lower then the interest they charge now, if you borrowed 2000 for the year it would cost similar to now


If people think like that they will borrow the full amount everytime they know they'll be a tenner over. It wouldnt really help that much to place it in savings elsewhere of course

opinions4u

Yogicat wrote: »

For those unhappy with the new overdraft charges introduced by Halifax, log onto www.consumeractiongroup.co.uk/forum.

They have template letters if you wanted to complain to Halifax, OFT, local MP's etc, even a Petition for No. 10 is in the process of being set up.

Why not go the whole hog?

Set up a petition banning banks from charging for anything. God forbid a business should exist to make money.

Ask them to make all credit cards, loans and mortgage interest free and legislate against them having premiums on thier insurance policies.

And when the banks choose to stop trading as a result, ask yourself what you have really achieved as you see an economic meltdown that makes the recent crisis look totally insiginificant.

sabretoothtigger

Speaking of CAG, has their been a ruling on the bank charges refund thing. They kept putting it off last I heard, its a massive liability hanging over them of potentially billions afaik going back six years

GiMac

I am gutted. Got same letter this morning. I have an overdraft with BOS, which was at £1k but I have managed to whittle it down and had managed to get it down to £520. I am currently paying a high %age rate approx 20%APR, but since I was made redundant and went self employed just before the credit crunch hit things have been tight and I just couldnt afford to pay it off in one go.So i stomched the rate rises and put a plan into place to clear the debt. After the initial rate rises it was costing me about £8-9 a month in interest. But I was managing to pay in £25-30 a month to help reduce the outstanding balance slowly but surely.

Now I have no chance, its gonna cost me £30-31 a month, so I will struggle to even cover the charges let alone reduce the debt, which was my intention.

Basically they have more than tripled, in fact since the initial rate I was on they have quardupled the cost of this facility to me. Fair? I think not, but I don't think there is anything I can do about it.

Interest rates at the lowest they have ever been, wholesale money costs to banks low, yet bank charges are at the highest level they have ever been. Does nobody else think this is wrong?

sabretoothtigger

You may be better off taking out a personal loan or transferring the debt to a credit card deal.
Alot of them give special offers when you first setup a card, they are relying on you just spending on the card but if sensible it can save you money, worth a look


I think this might be the banks intention, get people to basically sort out their finances and speak to them about formal loans. They may just lose alot of business of course, basically the bank as a whole needs more savings to fund all the debt they have themselves

opinions4u

GiMac wrote: »

Interest rates at the lowest they have ever been, wholesale money costs to banks low, yet bank charges are at the highest level they have ever been. Does nobody else think this is wrong?

While the headline LIBOR rates are low, each individual bank has a risk rating over and above this that they have to pay. In many cases banks cannot raise funds on the money markets for terms beyond 12 months. It makes life difficult if customers expect to be able to use their overdrafts for longer periods of time!

Overdraft lending is just about the riskiest form of personal credit offered by banks. Those risks have risen substantially in recent months. There was a post on this forum recently from somebody who knew they were going to be made redundant and intended to increase their overdraft as a result. No plan to repay the debt though. This highlights exactly why banks are not falling over themselves to increae overdraft availability and reduce charges for being overdrawn.

Unfortunately this charging structure benefits those who currently pay the £28 and £35 fees for failing to manage their accounts. These charges are abolished.

Those costs are effectively passed on to those operating their accounts within authorised overdraft limits.

When the idea was conceived it certainly wasn't about making bigger profits. It was all about coming up with a charging structure to satisfy the likelihood of old style bank charges being rule illegal.

benabouttown_2

I got this letter, just like everyone else and it threw me off, as i almost was thinking it was the normal spam offer letters you get

£1 a day on any amount.

My issue is that i don't monitor the account daily, you never know exactly when Direct Debits turn up in comparision to when payments come in, so £1 a day compared to 1.5% a month my sound better at £1500, £2000 or more but at £200, £300, etc

now i am trying to work out ... where the breakeven point is comparing the new old rate and time to the new daily fee over time.

does anyone have this ? it will make it a lot easier to decide if to keep the account of go MILES in to overdraft.