Help - Abbey sneaky tactics

LH79_2

My OH and I changed current accounts (each individual and joint) to Abbey (with whom we have a mortgage) about 6m ago, from Barclays who were useless. Abbey promised to match our overdraft limits (otherwise we wouldn't have gone with them). My OH has now had letter to say his OD limit is being slashed from £1250 to £400, and our joint ac one from £300 to £50. Letter started by sayaing ' as you may be aware, your overdraft is up for review on 1 Sept, and unfortunately we are reducing it .. blah blah blah'. (we weren't aware they were up for review)

Now, with nearly 10 years at Barclays, limit was never reviewed, in fact increased. Neither of us has exceeded the limits, and we are both well paid (overdraft accumulated like bthese things do, new house etc). I haven't received a letter yet, but can't see why they wouldn't change mine if they are changing OH's.

Anyway, going to make appt to see them at the weekend, but would be interested to hear if anyone else has heard of these kind of tactics - seems very sneaky to get our business, and then do this.

homersimpson_3

overdrafts can be useful for emergenices but are must be repaid immediately on demand. if you can't repay bank usually insist you take out loan to clear it etc etc. some banks & some building societies in particular expect you to repay overdraft if you have had some for a while to ensure a) they get their money back (debt after all) and b) good money management/stop things spiralling out of control. from one perspective makes sense- banks are trying to help you. increasing overdraft all time suggests to make not good at managing money- living within means etc. all you need to do is tell bank reason for overdraft, how you propose to reduce it and over what time scale (e.g. due to buying things for house, pay £50 per month to bring it down and will take 1 year to clear etc)

domestic_goddess

A lot of banks and building societies are currently reviewing their responsible lending policies due to pressure put on them by the government to ensure they are not over extending people ( so my branch of halifax told me ).

hth

LH79_2

I know that they are repayable on demand (but lets face it, overdrafts aren't that unusual, and if you have a regular wage coming in, I have never heard of the bank demanding its repayed in full), it is more the tactics that Abbey have employed which is, in my opinion, unacceptable. Bearing in mind that we had both been with Barclays for 10 years, with the overdraft never reviewed, then move to Abbey, who promise to match the overdraft only to write now, which was the first we'd heard of it.

It would not surprise me if this were part of a bigger operation on Abbeys part to reduce their customers debt for their own business purposes, and thats why I was interested to hear whether this has happened to anyone else. I think they do this because they assume (wrongly in this case), that customers won't move.

Bearing in mind they have happily lent us our mortgage, seems odd behaviour.

LH79_2

Hi sickofhavingnomoney - tried to press thanks button, but didnt work!

Interesting what you say though, I hadn't thought about that.. have made appt for weekend, so will be interesting what they say.:D

LH79_2

homersimpson wrote:

. increasing overdraft all time suggests to make not good at managing money- living within means etc. all you need to do is tell bank reason for overdraft, how you propose to reduce it and over what time scale (e.g. due to buying things for house, pay £50 per month to bring it down and will take 1 year to clear etc)

Overdraft limits were last increased several years ago for my OH, and I'm on the same one I've had for years. I note your points though. Its just quite frustrating bearing in mind we have no other debt ('cept mortgage ), and I can't get any of the 0% credit cards, as although my credit history is fine, apparently I'm not a good customer 'cos never pay interest as tarted on 0%cards so they make no money from me. As a consequence, everything house wise has gone straight from current ac rather than being able to spread over 9 months say.