Student overdraft interest charges on agreement??

jamesscott778

Hi

My fiance has a barclays student overdraft which went over the overdraft limit and she got charged, the bank phoned her and agreed that she could make some monthly payments interest free to bring the balance back under her agreed limit, after doing this they sent her an agreement to repay the amount of the overdraft in installments but adding interest to this. does she have to accept this managed loan or can she make payments to clear the overdraft without paying any interest?

cheers

James Scott

bottleofred

Hi,

I would guess if your fiancee does not accept the bank terms, she may well end up paying more interest. To confirm this though she should contact the bank to find out. Is she no longer a student hence the reason for the charges?

DarkConvict

Assuming they are still a student, the overdraft maybe interest free. However it is possible that exceeding the overdraft means it is no longer 0%, much like overusing or failing to paya 0% credit card causes the interest to goto a normal rate of 15%+.

I can only assume the bank is asking her to make payments to the otherdraft to bring it down, as i know many students who have ran up the full £1000-3000 overdraft, and if it has a standard interest rate it will cost a fortune. The bank should not be recommending a loan, merely a suitable payment plan to bring them into the black.