If Only Lloyds TSB had offered me the Control Service Account earlier.....

Locksmith1892

About a year ago I went beyond my O.D limit in my Lloyds TSB current account and since then I have been charged whopping great bank charges every month, totalling £1500 to date.

When they debit these charges each month, this amount takes me overdrawn and the cycle starts all over again. Charges have snowballed and they've got me in a vicious circle. I have a claim in with the Ombudsman, (sent before the test case result) stating Financial Hardship (failed direct debits, credit card cash withdrawals, the amount of charges - all evidenced) and while I'm waiting, Lloyds keep charging me.

Lloyds wrote to me a month ago and said they're removing my O.D facility because they can't sustain it at it's current level and saying that unless I contact them I'll lose the O.D and they'll charge me daily and monthly fees for using an unplanned O.D. Cheers, I thought.

I called their Customer Support Unit (which I had to issue a formal complaint about a few months back) and the person I spoke to mentioned the Control Service which enables you to NOT be charged any daily fees for going overdrawn. You would just pay a monthly fee (£15), you lose benefits i.e phone insurance and the account fee is higher at £10 a month but clearly this was more like the account I needed to end my charge hell. Given my situation, this person at Lloyds CSU could not believe that the bank hadn't offered it to me before as it's the daily fees that have plunged me into financial turmoil over the last year and locked me in this cycle.

Lloyds have offered me a refinance loan which would tie me in to banking with them for another 4 1/2 years (a horrendous prospect) and the total monthly payments would lead to me paying them an additional £700 on top of the amount borrowed. They're saying this is the only option I have. If I refuse the loan then it'll get passed to Collections. The Ombudsman advised me to speak to the Consumer Credit Counselling Service, which I did, and they suggest that I try and get the bank to agree to hold my O.D until the Ombudsman gives its decision - it would be so frustrating to take the loan if I then got a payout, however unlikely that may be. The Ombudsman can't tell the bank to refund charges though can it? Is my best chance likely to be through trying the bank again and pleading (!) with them, arguing the Control Service point?

I'm tempted to open a new basic account and get my salary paid in there and clear the O.D with Lloyds as quickly as I can manage, having sought further advice from the CCCS and trying to get the bank to be reasonable. As they said in their letter "we promise to treat you fairly".

They haven't so far so why would they start now?

Any thoughts on this would be greatly appreciated.

Thanks

the_insider

Is the loan with Lloyds the best one out there? If you were to get a loan with another bank you could use it to repay the overdraft and then wait to see what FOS say about the charges. You could also open an account with another bank and pay off the overdraft as quickly as you can. If you open an account with Lloyds they can transfer your salary from it into the overdrawn account. But from the sounds of it you might be better off with the other account they offered you (I don't know much about Lloyds accounts).

The Ombudsman will decide whether the bank have treated you fairly and fully considered your situation in making their decision. If they don't think that they have done this then they can recommend that they increase the amount of compensation they offer you.

natweststaffmember

Locksmith1892 wrote: »

About a year ago I went beyond my O.D limit in my Lloyds TSB current account and since then I have been charged whopping great bank charges every month, totalling £1500 to date.

When they debit these charges each month, this amount takes me overdrawn and the cycle starts all over again. Charges have snowballed and they've got me in a vicious circle. I have a claim in with the Ombudsman, (sent before the test case result) stating Financial Hardship (failed direct debits, credit card cash withdrawals, the amount of charges - all evidenced) and while I'm waiting, Lloyds keep charging me.

Lloyds wrote to me a month ago and said they're removing my O.D facility because they can't sustain it at it's current level and saying that unless I contact them I'll lose the O.D and they'll charge me daily and monthly fees for using an unplanned O.D. Cheers, I thought.

I called their Customer Support Unit (which I had to issue a formal complaint about a few months back) and the person I spoke to mentioned the Control Service which enables you to NOT be charged any daily fees for going overdrawn. You would just pay a monthly fee (£15), you lose benefits i.e phone insurance and the account fee is higher at £10 a month but clearly this was more like the account I needed to end my charge hell. Given my situation, this person at Lloyds CSU could not believe that the bank hadn't offered it to me before as it's the daily fees that have plunged me into financial turmoil over the last year and locked me in this cycle.

Lloyds have offered me a refinance loan which would tie me in to banking with them for another 4 1/2 years (a horrendous prospect) and the total monthly payments would lead to me paying them an additional £700 on top of the amount borrowed. They're saying this is the only option I have. If I refuse the loan then it'll get passed to Collections. The Ombudsman advised me to speak to the Consumer Credit Counselling Service, which I did, and they suggest that I try and get the bank to agree to hold my O.D until the Ombudsman gives its decision - it would be so frustrating to take the loan if I then got a payout, however unlikely that may be. The Ombudsman can't tell the bank to refund charges though can it? Is my best chance likely to be through trying the bank again and pleading (!) with them, arguing the Control Service point?

I'm tempted to open a new basic account and get my salary paid in there and clear the O.D with Lloyds as quickly as I can manage, having sought further advice from the CCCS and trying to get the bank to be reasonable. As they said in their letter "we promise to treat you fairly".

They haven't so far so why would they start now?

Any thoughts on this would be greatly appreciated.

Thanks

Priority debt arrears(mortgage/rent, council tax, utilities)?