Halifax Halifacts Halifiction

LongTermLurker

noh wrote: »

Is it possible to reduce the interest charge below the current level of 0%?

Whether you call it interest or a "charge", the end effect is the same. I accept masonic's description, whether absolutely accurate or not.

Alas it it does not make me feel in anyway richer by exploiting the ignorant or downtrodden/unfortunate . I will have exploited them anyway by default . I might try and give my opinion but opinions are like ...

I don't think anyone is trying to exploit "the unfortunate" - the payments & fees are flat figures and I don't believe that a rise in one causes the rise of the other.

davidgmmafan

"They are completely clear about it wherever they promote this account. There is no way that someone could have opened this account and not know how it works."

That's clearly the case now, the only issue I have with this account is people who may have been locked in to the £1 or £2 per day. Yes I know they gave advance notice but I'm thinking of someone with a small surplus each month who has fallen on ahrd times.

Given that banks routinly ignore accepted guidelines for outgoings and offers to creditors I see no reason to believe they would backdown here. If someone was paying £30/month the balance would've been reducing if it was based on interest. Under the current system it would not be.

Why can't they reject the terms and conditions and repay the DEBT at the interest rate and terms they DID agree to like a credit card? Notice the Halifax slight of hand. If you don't want the charges then close the account. If you do not have the money lying around to close the account, ie pay the balance off in full, we can legally charge whatever we want. Superb.

noh

davidgmmafan wrote: »

"They are completely clear about it wherever they promote this account. There is no way that someone could have opened this account and not know how it works."

That's clearly the case now, the only issue I have with this account is people who may have been locked in to the £1 or £2 per day. Yes I know they gave advance notice but I'm thinking of someone with a small surplus each month who has fallen on ahrd times.

Given that banks routinly ignore accepted guidelines for outgoings and offers to creditors I see no reason to believe they would backdown here. If someone was paying £30/month the balance would've been reducing if it was based on interest. Under the current system it would not be.

Why can't they reject the terms and conditions and repay the DEBT at the interest rate and terms they DID agree to like a credit card? Notice the Halifax slight of hand. If you don't want the charges then close the account. If you do not have the money lying around to close the account, ie pay the balance off in full, we can legally charge whatever we want. Superb.

There seems to be some confusion.
This charging structure ie flat rate fees has always applied to the Reward current accounts (which is the subject of this thread) since the accounts were first introduced in February 2009. So for holders of the Reward accounts no new conditions have been imposed they are the conditions and fee structure they originally agreed.

Holders of the current account, originally called the High Interest Current Account, have had their T+Cs changed (from December 2009) to be the similar to those for the Reward accounts but without the £5 reward for depositing £1000 pm.

masonic

davidgmmafan wrote: »

"They are completely clear about it wherever they promote this account. There is no way that someone could have opened this account and not know how it works."

That's clearly the case now, the only issue I have with this account is people who may have been locked in to the £1 or £2 per day. Yes I know they gave advance notice but I'm thinking of someone with a small surplus each month who has fallen on ahrd times.

Given that banks routinly ignore accepted guidelines for outgoings and offers to creditors I see no reason to believe they would backdown here. If someone was paying £30/month the balance would've been reducing if it was based on interest. Under the current system it would not be.

Why can't they reject the terms and conditions and repay the DEBT at the interest rate and terms they DID agree to like a credit card? Notice the Halifax slight of hand. If you don't want the charges then close the account. If you do not have the money lying around to close the account, ie pay the balance off in full, we can legally charge whatever we want. Superb.

Overdrafts are supposed to be used to bridge the gap between bills being paid and income being paid. Overdrafts are repayable on demand and banks are known to remove overdrafts from people who abuse them as long term loans. Anyone in the situation you describe needs a personal loan, not an overdraft.

davidgmmafan

Oh I give up, I can't be bothered to explain things anymore to people who can't use thier imagination. Perhaps somebody used the overdraft temporarily, the car died or someone died. Something essential that needed to be done, then they lost thier job etc etc. They've contacted a charity like you are supposed to, the bank has effectively increased thier APR and has an obligation to do no more than be sympathetic.

In other words consider the info and say yes we sympathize, but we're going to do nothing. The only consolation is this approach is self defeating as it increases the likelihood of a write off for the bank.

AnonymousForObviousReason

davidgmmafan wrote: »

Oh I give up, I can't be bothered to explain things anymore to people who can't use thier imagination. Perhaps somebody used the overdraft temporarily, the car died or someone died. Something essential that needed to be done, then they lost thier job etc etc. They've contacted a charity like you are supposed to, the bank has effectively increased thier APR and has an obligation to do no more than be sympathetic.

In other words consider the info and say yes we sympathize, but we're going to do nothing. The only consolation is this approach is self defeating as it increases the likelihood of a write off for the bank.

Well if the car or someone died, ohhhhh using my imagination maybe the person died in a horiffic car crash taking out both? Then a credit card would be best payment method. That would give up to 58 days of credit to sort out a personal loan. If they also lost their job then hopefully if they didn't have enough savings they'd have got insurance to cover the costs of mortgage and interest on other debts.

blueberrypie

davidgmmafan wrote: »

Why can't they reject the terms and conditions and repay the DEBT at the interest rate and terms they DID agree to like a credit card? Notice the Halifax slight of hand. If you don't want the charges then close the account. If you do not have the money lying around to close the account, ie pay the balance off in full, we can legally charge whatever we want. Superb.

The original terms and conditions - the ones the customer did agree to when he/she borrowed the money - would have stated that the overdraft was payable on demand. So even if Halifax had said "you can choose between the new t&c or the old ones", there would have been no guaranteed facility for the customer to repay the debt over time.

As masonic has said, an overdraft isn't an appropriate form of funding for someone in the position you describe. A credit card might be, a bank-loan might be - but any debt that is payable on demand isn't suitable for long-term borrowing.

davidgmmafan

"any debt that is payable on demand isn't suitable for long-term borrowing."

I agree, but the blame is twofold. Customers for not heeding that condition, and banks for forgetting about it and allowing people to act AS IF it didn't exist. Having re-discovered it (when it works to thier advantage) looks dubious to me. Especially when it means the most rational course of action for some customers (assuming they don't need credit for six years or so) is to stop paying.

The bank has chosen to do NOTHING to help people in this position, which I cannot understand as it will ultimately be a lose lose situation for them and the customer. What's the point of that?

opinions4u

Having re-discovered it

Strange that. Every overdraft offer letter I have ever had has said something like "Overdrafts (interest and charges) are repayable on demand" written on it.

(That was a copy and paste from an offer letter in early 2009)

blueberrypie

davidgmmafan wrote: »

"any debt that is payable on demand isn't suitable for long-term borrowing."

I agree, but the blame is twofold. Customers for not heeding that condition, and banks for forgetting about it and allowing people to act AS IF it didn't exist. Having re-discovered it (when it works to thier advantage) looks dubious to me. Especially when it means the most rational course of action for some customers (assuming they don't need credit for six years or so) is to stop paying.

The bank has chosen to do NOTHING to help people in this position, which I cannot understand as it will ultimately be a lose lose situation for them and the customer. What's the point of that?

There were quite a few options discussed in the very long threads about the changes to Halifax's fee structure in the latter half of last year. Some customers were advised (by Halifax staff) to turn their accounts into Ultimate Reward Accounts, which gave them a fee-free overdraft of £300 - there is a charge for the URCA, but it is cheaper than paying £1/day, and it could be partially offset by collecting the £5 reward payment. Others were advised to take out a Halifax credit-card, and were offered an interest-free period on transfers, so that they could shift their overdraft debt onto that and aim to pay it off during the interest-free period. So it's not quite true that Halifax did absolutely nothing.

And of course they did give customers notice - they sent letters out 60 days ahead of the changes, and issued a press release about them in December 2008 - a full year before imposing the new fee structure on those customers who hadn't already voluntarily switched to it. Those who could not have paid off their overdrafts (or at least reduced them to under £300) between December 2008 and December 2009 would have been in even more serious trouble had Halifax chosen to demand immediate repayment of their overdrafts.