Mortgage payment taken days before it is due!

Magpie117

Since Jan I have been watching my mortgage payments online. What I have noticed is that every time the first of the month is on a Monday or there is a bank holiday, the payment gets taken on the Saturday before but often isn't credited into the account until the second of the month(usually a Tuesday). This pattern happened in Jan, Feb, March, May, June and I am still waiting for Nov payment to appear on my mortgage account when the money was taken on 30 Oct. I have spoken to the bank who have told me it is because they are so busy when the first of the month occurs on a Mon or after a holiday that they need to take the payments early to ensure they get through the workload. Apparently this is also why they can't get the money credited into the account. Is it just me or am I right to feel a bit ripped off as they taking my money for an average of 48 hours without crediting my account? I wonder how much they are making on all their accounts every month by doing this? Any thoughts?

Thrugelmir

Might appear on the Saturday but the transaction actually occurs on the next working day.

Magpie117

I thought it might go through on the next working day (ie the Mon)but have checked a ministatement and my current account says the money has gone.I have also asked in branch on the Sat and been told that the money has been taken from my account that day. This is why I feel a bit ripped off and wonder how much money a single bank can make if they take money early like this from many of their customers.

opinions4u

It depends on what the terms and conditions of the current account and the mortgage account say.

Is it just me or am I right to feel a bit ripped off as they taking my money for an average of 48 hours without crediting my account

Well, I'm sure you would have utilised the sum to great benefit during that 48 hours, so absolutely. It's clearly a rip off that has cost you a small fortune!

benjo

Opinions4u has it right - depends what the Terms and conditions of the accounts say.

It might also depend on how you set up the DD instructions, I always specify mine as the 1st of each month OR the 1st working day AFTER the 1st of the month. My mum always set her DD's up as the 1st of the month OR the last working day BEFORE the 1st of the month.

I have accounts with a few banks and the way that payments appear on statements are quite different, but ultimately they dont enter or leave any of the accounts until the specified date regardless of what the statement appears to say.

If the money is truely taken from one account and not credited to another for 48 hours then in theory you are either loosing 48 hours of interesting or incurring 48 hours of interest, is that the case? If it is, then personally I would change my account, since if this really is happening over 25 years it will add up.

dunstonh

Saturday is not a working day. So, technically its taken Monday. However, the computer systems of most of the banks can actually show transactions that are going through on Monday (so far) early in the morning on Saturday.

It has been like that for over 20 years. I remember working for a bank in the late 80s when saturday morning opening was rare and we used to get people come in especially to get a "printout 10" forecast balance which showed Monday's transactions that had appeared so far.

The transaction shows the full value being debited and reduces cleared funds but the debit date is still Monday.

LilacPixie

RBS is ;like that. If a DD due out on the 1st and thats a monday then the transaction leaves the account on the saturday but the date against the transaction is the Mondays.

Joe_Bloggs

From the BACS web site.

If the payment due date falls at a weekend or on a bank holiday the organisation is obliged to debit your account just after the due date, not before, unless they notify you in advance of a change of date.

I suspect some banks have computer systems and staff that are not in line with the 24/7 global economic reality.

J_B.

Thrugelmir

dunstonh wrote: »

Saturday is not a working day. So, technically its taken Monday. However, the computer systems of most of the banks can actually show transactions that are going through on Monday (so far) early in the morning on Saturday.

It has been like that for over 20 years. I remember working for a bank in the late 80s when saturday morning opening was rare and we used to get people come in especially to get a "printout 10" forecast balance which showed Monday's transactions that had appeared so far.

The transaction shows the full value being debited and reduces cleared funds but the debit date is still Monday.

Direct debits are processed ahead at weekends due to the sheer volume of transactions. Systems wouldn't cope with posting millions of transactions at 1 minute past midnight.

With Lloyds I can see next day transactions from around 11 in the evening during weekdays.

dunstonh

Thrugelmir wrote: »

Direct debits are processed ahead at weekends due to the sheer volume of transactions. Systems wouldn't cope with posting millions of transactions at 1 minute past midnight.

With Lloyds I can see next day transactions from around 11 in the evening during weekdays.

The processing used to appear on systems around 4am. Its been getting faster. Although sometimes they can also appear much later if volumes are higher or there are issues.

However the key thing is that they are not debited early. They just reduce cleared funds early but are debited on their correct date.