Halifax new bank charges!!

djpleasure

Extant wrote: »

What does post count have to do with anything? Who cares about that?

But, welp, you sure showed me with that great big post. I'm touched you took the time to write that whole thing about me. Consider me well and truly put in my place!

Yeah, I assumed that kind of response...Just further displays your ignorance.

I think I ought to stop now, as you love the attention.

Good night

jambosans

This thread gives me a headache, but seeing as I've read the whole thing (and partially wondered why it was dead, then exhumed), just feel I should pass comment.

To summarize: this thread is not that bad (only two posters have went bananas and assumed the role of the manners police). I also think that djpleasure needs to realise that he/ she is not a moderator, and that flaming posters like Extant is more likely to be considered abuse, than some curt post which is on topic.

Edit: I realise and apologise this post is completely off topic, but this thread went off topic about a page ago.

Andystriker

sinbin_72 wrote: »

Right. I'll just magic up the 1000 that I owe from the £20 per week that I get to myself - from working - and then i'll force a bank to let me open an account. So dar 3 have refused.

It's that easy is it - GET REAL!

If you take the time to read my post you will see

"If you have an overdraft then the best option is to move banks. Some may not be able to move banks because they can't get an account elsewhere, and those people have my sympathy."

How am I not real?

KVAK

The new charge of £1 a day verges on extortionate credit. If you are overdrawn by say £250 per month, don't have a large income and use your overdraft frequently then you will incur a charge in excess of £300 per annum.
Currently a customer with a £700 overdraft with HBOS will pay around £13 per month.With effect from 26th January this will double to £26 per month. As regards their cash reward account. This account was previously a cashback account where customers received 1% of turnover on debit card use. The average customer received between £140 and £160 per annum. HBOs have generously replaced this with £60 per month.

noh

KVAK wrote: »

The new charge of £1 a day verges on extortionate credit. If you are overdrawn by say £250 per month, don't have a large income and use your overdraft frequently then you will incur a charge in excess of £300 per annum.
Currently a customer with a £700 overdraft with HBOS will pay around £13 per month.With effect from 26th January this will double to £26 per month. As regards their cash reward account. This account was previously a cashback account where customers received 1% of turnover on debit card use. The average customer received between £140 and £160 per annum. HBOs have generously replaced this with £60 per month.

The new charging structure came into effect 6th December 2009.
I don't think the Reward account was designed to replace anything and I seriously doubt that the average customer with the cashback account received £140-£160 pa. To get that amount they would have to be spending £1200 or more a month by debit card.
I would think the £60 pa max possible Reward payment is probably greater than the average amount that was earned by cashback account holders.
Unless of course you can quote a source for your figures?

opinions4u

KVAK wrote: »

The new charge of £1 a day verges on extortionate credit.

It's certainly expensive, but a charging structure that discourages reliance on overdrafts is not necessarily a bad thing. If you're overdrawn for 5 days or less and earn the £5 Reward payment then it effectively costs you nothing.

If you are overdrawn by say £250 per month, don't have a large income and use your overdraft frequently then you will incur a charge in excess of £300 per annum.

Only if you're overdrawn for more than 300 days.

If you're overdrawn for 5 days a month every month you will be charged £60 a year, offset by £60 in Reward payments. A free overdraft for 60 days a year!

As regards their cash reward account. This account was previously a cashback account where customers received 1% of turnover on debit card use.

It was called the Moneyback Current Account.

The average customer received between £140 and £160 per annum. HBOs have generously replaced this with £60 per month.

The cashback structure on the Moneyback account was 1% of spending up to £10,000 and 0.1% above this.

To generate £140 in cashback you would have to spend £50,000 a year on your debit card. £70,000 for £160.

Your figures suggesting the average customer spends more than £50,000 a year on their debit card are patently nonsense and I know as a fact that more customers earned less than £60 a year than earned more.

KVAK

I Retired from HBOS last year after working for them for 32 years. The new charging structure was set up to replace interest charges and will as usual hit the people who can least afford it, the folks who can't afford to pay off their overdrafts because they are on a limiyted income.
I spoke to ex colleagues yesterday who tell me that they are to offer personal loans at rates approaching 28apr with a view to clearing off these overdraft.
an example from yesterday 2000 x 60 months @ £64.91 ( admittedly this includes ppi but the hard sell is still being used on PPI)
As regards the quotation on averages per moneyback account this was taken from my own experience.Last time I received this it was £131.97.
I can assure you I earned nowhere near £50k. Try halving that !!
Opinions 4u ,never make assumptions on someones backgound. I haven't.

opinions4u

KVAK wrote: »

I Retired from HBOS last year after working for them for 32 years. The new charging structure was set up to replace interest charges and will as usual hit the people who can least afford it, the folks who can't afford to pay off their overdrafts because they are on a limiyted income.

I saw a key board level presentation regarding the changes towards the end of 2008. They were cost neutral. The impact of charging was being moved from failed payments and unauthorised overdrafts to authorised overdrafts. Nothing more, nothing less. Interest income on overdrafts is tiny compared to the amount raised in bank charges.

I spoke to ex colleagues yesterday who tell me that they are to offer personal loans at rates approaching 28apr with a view to clearing off these overdraft.

Some will no doubt pay the high rates. Others will pay less. Others will use a 0% credit card to dodge the charges.

an example from yesterday 2000 x 60 months @ £64.91 ( admittedly this includes ppi but the hard sell is still being used on PPI)

HBOS no longer sells PPI for loans in branch. They have also moved to a monthly premium, rather than a lump sum with interest rolled up on to it.

If you're retired why would you want PPi anyway?

If you have an overdraft of around £2,000 you won't be worse off under the new charging structure.

As regards the quotation on averages per moneyback account this was taken from my own experience.Last time I received this it was £131.97.

Which would have required a spend of £41,970.

I can assure you I earned nowhere near £50k. Try halving that !!

I never said you did. Are you sure you're not referring to spending on a cashback credit card though, because the Moneyback Current Account calculated its cashback in exactly the way I described above.

Opinions 4u ,never make assumptions on someones backgound. I haven't.

Where have I assumed anything about your background? I stated facts about the Moneyback product, which you seem a little less knowledgeable about.

izools

Wow what a thread.

I would like to make an obervation if I may.

Anyone who lives in their overdraft / uses it on a very regular basis, but doesn't breach it, certianly can consider themselves to be managing well. When I say managing, I don't mean their money, I mean their problem. Anyone who needs the constant or near constant use of an overdraft only needs to do so because of a current or prior inability or unwillingness to spend within their means.

But that's fine, we all go through hard times and sometimes need the help of our bank to get us through. But that is what it is - gracious help from the bank - not a right.

Everyone who has borrowed money from their bank in one form or another has accepted a favour, in the knowledge that it is not a free favour. If the pricing structure changes, that is simply the choice every bank is within their rights to make. No, it does not instill customer loyalty. No, it does not help loyal customers, and yet, it will ensure that many customers feel very hard done by.

It is a commercial decision not an emotional one, and one that any business is well within their rights to make. People may be hurt and put under financial stress by the decision, but it's been made and there's nothing average joe can do about it other than grit their teeth.

For some it may not be easy to switch to another bank and be automatically given an overdraft. This will no doubt be due to the fact, that due to either income and expenditure, or previous bad credit account management, there is evidence to suggest the applicant can't afford to handle such a facility.

Now, your interpretation of "Handling" an overdraft may be to ensure never to go over it, however the bank you are applying to may consider "Handling" an overdraft to be only using it once in a blue moon, or using it less than 50% of the time. Again, that is their decision as a business to make and there's nout that can be done about it.

What can be done?

> Scrutinise your budget. Be harsh with yourself and establish areas you can cut down in spending to ensure you can slowly but surely reduce your overdraft limit until it is at £0

> Find more money. Maybe work extra, maybe check you are getting all the benefits and financial help you are entitled to.

> Find out what is causing you to have a poor credit score preventing you to move to another bank. Usually it is because of too many prior applications, this is the quickest sure fire way to ruin a credit score - apply too often. Check Experian / Equifax for nasties and correct any that are wrong.

> If you are genuinely unable to clear the overdraft at any rate atall or cut back on spending, because you are being totally honest with yourself and there's still no way to cut back, then move your finances to another bank with a basic bank account. Perhaps the Barclays Cash Card account which comes with a Visa debit card. Level with Halifax about your financial situation and advise that you can't repay your overdraft until you have more money. Send them income and expenditure calculations proving this. Make whatever contributions you can comfortably afford and once it's gone, it's gone, but it shouldn't matter how long it takes, as you won't be paying them so much as to stretch yourself.

As far as I can tell, these are the most viable ways forward, and although it is easy to blame Halifax for costing you more money, it may actually be that they have unwittingly uncovered a graver reality that is your finances really are a bit messed up and you'll have to face the problem after a while of hiding from it or sugar coating it.

-iZools

KVAK

If you have an overdraft of around £2,000 you won't be worse off under the new charging structure.

Agreed. I am talking about small overdrafts, say £500 or less.
I am in fact talking about people like my daughter who has just finished uni.
she has taken a job with a salary of around £11000 a year. A few days after pay day when her rent is taken from her account she is normally back in overdraft. Never exceeds the limit but is often close to it. result bank charges now of £26 per month vs her old interest of about £11.
now 26 x 12 = £312 charges on a £500 overdraft. The loan was also as quoted by her local branch.
I gave her the money to clear it!!. How many young folks in her position don't have people who can help.
My point in this all along is that it is verging on extortionate credit on small overdrafts for people who cannot get out of using them.