My overdraft has been decreased?

DogTailRed2

Hi,

I have been with my current bank for 20 odd years.
In that time I have never been in debt, always paid my bills and mortgage. I have a perfect credit record.
So I was interested to receive a letter saying that my overdraft has been reduced from £1500 to £1000.
This is strange as the bank has been giving me increases against my will for many years now even though I vary rarely go much over £100 of overdraft normally caused by late payments of salary, bills etc. So it's always an anomaly rather than a trend.

Now I don't particularly care as I don't need the overdraft and looking to change my bank anyway. I wanted peoples opinions. Is this a bank being sensible or something more sinister.

I'm currently unemployed and planning to pay off the remainder of the mortgage with investments and live off savings for the next 14 months. Could this be the reason? Just seems a bit draconian to just change stuff without asking.

Thanks,

Ted.

Lokolo

Honestly. Not a clue as to why.

YorkshireBoy

DogTailRed2 wrote: »

So I was interested to receive a letter saying that my overdraft has been reduced from £1500 to £1000.

Has been, or will be at some future date? ie have they given notice?

Is this a bank being sensible or something more sinister.

Recent (last couple of years?) rule changes in potential debt coverage mean they're freeing up unused credit to give to other account holders. Nothing sinister. Indeed, I've had it done myself last year with Yorkshire Bank...and I've been with them 30 years!

I'm currently unemployed

Maybe their systems have detected a reduction in throughput/salary credits and that's what's triggered it?

doelani

The bank I used to be with both as a customer and I worked for them worked overdraftsamount by amount going into account.

As YorkshirBoy says if the bank system has detected a reduction in amount going into your account each month this could be the trigger for overdraft being reduced.

If you are concerned ask the bank. Probally nothing sinister in it though just their criteria for overdrafts.

HouseHuntr

DogTailRed2 wrote: »

Now I don't particularly care as I don't need the overdraft and looking to change my bank anyway. I wanted peoples opinions. Is this a bank being sensible or something more sinister.

Then why bother to post on here if you're not bothered. It's a fact of life just as the price of food goes up and down, so do overdrafts.
Opinions ? What do they count for exactly, it's not going to change anything and you don't want anything changed in any case. How paranoid you are will answer the final question.

simax

M-I-L had a letter the other day, informing her that her £14,000 Mastercard limit had been reduced to £1,000.....

When asked why, they told her "Well, maybe because your balance has been £0 for years....".

Suppose they also want to stop a potential thief getting the card and running up a 5-figure debt on a rarely used account?

HouseHuntr

Or allocate that credit elsewhere where it might be utilised.