Halifax- whats the catch?

hasnain721

Hi,

I currently have a 'normal' current account with HSBC. As I'm gonna start uni in september, i was doing a bit of research and found out that Halifax's student account offers the biggest overdraft facility. In addition, Halifax's saving account also offers the highest interest rate. So i was thinking of getting the maximum overdraft from the student account and transferring it to their saving account and returning back the 'original' overdraft money that i borrowed.
Now it all sounds too good to be true. Am i missing something here?


Thanks!

tinkerbel

I think the 'catch' is that it is rare that you will get this big overdraft straight away and you have to actually use the account if you want them to increase it

dannyxx25

In my own opinion HSBC are a better bank than Halifax

hasnain721

tinkerbel wrote: »

I think the 'catch' is that it is rare that you will get this big overdraft straight away and you have to actually use the account if you want them to increase it

Oh right! So will I have to pop in to the local branch to find out how much i will get?

dannyxx25 wrote: »

In my own opinion HSBC are a better bank than Halifax

In what ways?

atypical

hasnain721 wrote: »

Oh right! So will I have to pop in to the local branch to find out how much i will get?

If you go into branch they'll only tell you what your initial limit will be (will probably be something like £500) then you have to gradually ask for increases. As you can see from the poll here the majority get between £1000 to £2000 before increases are rejected, despite them advertising the £3000 overdraft heavily.

NatWest's overdraft is a lot more transparent and concrete.

rb10

Providing that you have a reasonable credit history (i.e. your account with HSBC has been conducted well, and you haven't gone overdrawn etc), then you should be able to get £1000 straight away. (N.B. You will have to request that they apply this limit, as otherwise you'll get the default limit of £500).

Once your first student loan installment has gone in in September, you should be able to increase the overdraft further (e.g. £1750), and then increase it again a little later on.

It might be worth opening a current account with Halifax now, and using that instead of HSBC. This means that when you come to request an overdraft from them, they know more about you, so are more likely to look favourably upon you than if you were a brand new customer.

But, yes, your plan is a good one. Just ensure that you don't go over your limit -as the charges for going into an unauthorised overdraft will quickly outstrip any interest in the savings account. It can be useful to leave a small buffer in the account, just in case (e.g. if your overdraft limit is £2000, try not to go below -£1900). And don't be tempted to spend the money in the savings account!

LauraJayne_2

Also make sure your savings are instant access as Halifax can take away the interest free overdraft if they like, esp if they know your stoozing

rb10

LauraJayne wrote: »

Also make sure your savings are instant access as Halifax can take away the interest free overdraft if they like, esp if they know your stoozing

I agree that they should be kept instant access, as Halifax (like any other bank) reserve the right to demand immediate repayment of any overdraft.

However, I do not believe that stoozing it is any more likely to increase the chances of this. They are likely to recall it if the current account is not being used sufficiently often, but otherwise I don't think you are in any particular danger.