ADVICE Lloyds TSB Current Acount Overdrawn

dohadeer

So...... a lot of debts on credit cards and such like but my main concern at the moment is my Lloyds TSB current account.

I usually scrape by from month to month and manage to just about pay direct debits, but these do bounce from time to time and I usually have a few unauthorised overdraft charges each month. (I had been relying on being able to reclaim them, but that's a different story.)

Anyway, in January, I was struggling a bit and found my current account around £200 overdrawn. Lloyds TSB contacted me and we agreed a repayment plan. They set up an overdraft facility of £680 on the account and I agreed to pay back £90 a month until it was cleared.

I thought this was strangely considerate and lenient of them to trust me to repay it like this and not demand it straight away. I quite sensibly used most of this overdraft to repay some other bills and debts.

However, Lloyds TSB then informed me I had incurred £338 (!!) of bank charges for January, which would be taken from my account on 1 March.
Unsurprisingly, I was unable to pay this and as I am now over the £680 limit because of this, I have been incurring a charge of £15 a day ever since !! I think the balance now stands at around £980, with £150 of charges due to be taken at the start of April and May.

This seems ridiculous and unfair to me for 2 reasons:

1. When they set up the £680 overdraft, THEY DID NOT MAKE CLEAR it was intended to cover the charges, which they are now claiming it was for. If I had known this I would not have gone and spent the money.

2. We sat and discussed my income and expenditure when we set up the plan and worked out exactly how much I could afford, again this CLEARLY DID NOT suggest I could afford an extra £338 of charges.

Lloyds TSB are now trying to set up a new repayment plan with me, but I am trying to dig my heels in until they start being more realistic about the charges on the account. Legally, if this were to be taken further, how do you think it would pan out ? If I refused to pay this until they stopped making charges on charges on charges, what would my rights be ? I would use the 2 arguments above, would these hold up in court ?

I now owe them around £1300, when I feel it should be the £680 we agreed.

Also, a few weeks ago they asked me to hand in my debit card to my branch and cancel all my direct debits. No instruction of what to do then. I did that several weeks ago and phoned them yesterday to ask what the next step was. They claimed I hadn't handed in my card as the branch hadn't contacted them to say so (?!) How myself or the branch were meant to know to do this I'm not sure, but anyway, I've still being incurring £15 a day of charges since then, which is clearly not my fault as the branch should have contacted them.

It's just spiralled so quickly and I'm wondering what would happen in the long run if I simply refused to enter into any agreement until they removed some or all of the charges. What would a court say with relation to my 2 points above ?

Any help or advice appreciated, thanks

Tixy

Okay you really need to get a plan of action together. Have you opened a new basic bank account elsewhere? Have you moved your salary/income across to the new account. If not do that ASAP.

I would then suggest that you complete a detailed statement of affairs to work out your incomings and outgoings each month and work out how much you can afford to pay towards all your debts including your overdraft. http://www.makesenseofcards.com/soacalc.html

Then you can write to Lloyds to suggest a monthly repayment plan and at the point ask them to freeze interest & charges. If you are showing a shortfall you need to get advice from one of the free debt charities - http://forums.moneysavingexpert.com/showthread.html?t=2077631

My opinion is that you will have no chance with regards going to court. As you arrangeed the repayment face to face you have no written proof of what was said so it would be your word against yours and they will have acted in accordance with their T&C with regards the level of charges.

Whilst you sort out a plan and how much to pay I would send this holding letter - http://forums.moneysavingexpert.com/showpost.html?p=21937969&postcount=52