Lloyds TSB Now Charging for Planned Overdrafts

MissDiggs

Just had to share this - I am completely furious!!!

I got home from work today to a letter from Lloyds TSB saying they're now going to charge £5 per month for each planned overdraft a customer uses, and then interest on top of course. How unfair is that?!!! So I am a responsible customer and have an overdraft which I am very careful not to go over and yet I'm still going to get charged!

I've been with Lloyds quite a long time but am now going to move unless by some miracle they agree to waive this. After all it's not in the terms and conditions I signed up to and I have a feeling they're not supposed to unilaterally change those...

In a nutshell, if you bank with Lloyds and have an overdraft you're going to get charged, whether you stay within it or not!

Lokolo

Why not budget, get yourself out of the overdraft, not have to use it apart from emergencies and save yourself the £5 a month?

Overdrafts are there for shorterm borrowing, not longterm.

MissDiggs

I do budget extremely hard, live on very little money and at the moment cannot survive without my overdraft (like a great many people). How about I move my accounts to a better bank? Think that's what I'll do!
I suggest you don't try preaching at people - they might not take it how you meant it.

paulmcerlean

This is old news. Vote with your feet.

Lloyds likely wont care mind you. It is still better value than some offerings. Halifax?

gerrardfan

recieved this letter the other day,luckily i don't owe anything on my overdraft currently but it will be the motivation to close it,thanks lloyds :cool: for anyone else it doesn't kick in till 2nd december so plenty of time to vote with your feet if you are able to!

fozmcfc

MissDiggs wrote: »

I do budget extremely hard, live on very little money and at the moment cannot survive without my overdraft (like a great many people). How about I move my accounts to a better bank? Think that's what I'll do!
I suggest you don't try preaching at people - they might not take it how you meant it.

The trouble is you might not get an O/D from another bank as banks do not have to give people O/D as standard. If you live on very little money, then that could even restrict the type of account offerred to you.

As it doesn't start till December is there no way you can use this as a push to get out of your O/D within the 3 months.

There really is no preaching, O/D are for short term use, not long term.

Hopefully you aren't just going to post and run from the site. The debt free wanabee board and so many other sections of the forums are full of people who offer support/advise. They are also full of people who could benefit from your budgetting ideas etc..

babyfreckles

MissDiggs wrote: »

I do budget extremely hard, live on very little money and at the moment cannot survive without my overdraft (like a great many people). How about I move my accounts to a better bank? Think that's what I'll do!
I suggest you don't try preaching at people - they might not take it how you meant it.

Sorry to bring this thread back to the top again - I am in the same boat as yourself, only recieveing my letter today. My overdraft is arranged at £250, which I have never gone over, but yet have to delve into it each month to live! I rung them and the lady I spoke to recons that I am the first person to have complained about it and that the letters have been going out since July! I have banked with them for the passed 10 years (Since finishing school and starting work!), but now I think its time to change...!

firewalker82

Wow, I recieved the letter today also and I am absolutely disgusted with this decision. I have, like many, been with Lloyds for a long time and have always appreciated there sensible and down to earth approach to banking. This latest announcement frustrates me for several reasons;

• we have two accounts with lloyds, both with MANAGED overdrafts, never unplanned!
• We also sign up to the gold account scheme with free AA recovery, phone insurance, travel insurance and overdraft facilities at £10 per account.

So in addition to paying for these extra bolt ons, we now have to pay for overdraft fee of £5 + interest (approx 19.8%APR). That would be an additional £10+!!

It seems to me that they are trying to look as though they are doing something to help people who neglect their accounts and use unplanned overdrafts and punishing the people who dont. Therefore moving money that they have lost from unplanned overdrafts and making it up from planned overdrafts! If they really wanted to make a difference, then why not just bring the costs down for the unplanned o/draft fees and not planned o/drafts??

I have a young family (2 children) and while we try to stay out of the o/draft it does not always happen that way. especially in the current climate, we only spend wisely and while we could try to move our selves out of the o/draft, we dont feel that we should have to as we qualify for the gold account (£10).

If Lloyds are trying to lose customers, then this is definately the right way to do it. I know that it is a hassle moving current accounts to a new bank, but I feel that what they have done is inexcusable.

THANKS LLOYDS, I WILL BE TAKING MY ACCOUNT ELSEWHERE!!!:mad::mad:

tiff

I didnt know this, do you need to call them to remove an overdraft limit or can you do in your online account?

jambosans

firewalker82 wrote: »

[*]we have two accounts with lloyds, both with MANAGED overdrafts, never unplanned!

Try increasing the overdraft on one of your accounts in order to consolidate the other e.g. if you have a Classic Account with £500 Planned Overdraft and Gold Account with £500 Planned Overdraft try and increase the Gold Account to £1000 and remove the overdraft from the Classic completely - saving you £5 per month.

firewalker82 wrote: »

[*]We also sign up to the gold account scheme with free AA recovery, phone insurance, travel insurance and overdraft facilities at £10 per account.

The Gold Account costs £12 per month, and the £5 Monthly Overdraft Usage Fee does not apply to first £100 interest free overdraft.

firewalker82 wrote: »

If they really wanted to make a difference, then why not just bring the costs down for the unplanned o/draft fees and not planned o/drafts??

They're a business, not a charity.

jambosans

tiff wrote: »

I didnt know this, do you need to call them to remove an overdraft limit or can you do in your online account?

Why would you remove your overdraft? An Unplanned Overdraft will cost you at least £16 more. See below for examples:-
http://www.lloydstsb.com/current_accounts/overdraft_changes.asp#ava

It would be far more productive to sign-up for text alerts, which are now free (because of this change). You can then arrange a text to be sent when your balance drops below a certain level, allowing you to prevent a Planned or Unplanned Overdraft. See below for more details:-
http://www.lloydstsb.com/mobile_services/free_text_alerts.asp