Lloyds TSB Overdraft Charges

bachey03

In August i purchased an overdraft with lloyds. I activated my overdraft online and was pleased to find out the interest charges were 0%. I received terms and conditions in the post to confirm this. A week later i had been charged interest so went to my lloyds branch. They said they had never come across this but would look into it. Its taken me 10 weeks to get an answer and they have said unfortunately they cannot offer me the original agreement. I am still waiting for my new terms and conditions which they have said i will receive shortly. Im not happy because i have it in black and white that i shouldnt be being charged!!!!!! Just wondered if anyone had experienced this? Any ideas what i should do?

Premier_2

Complain

http://www.lloydstsb.com/contact_us/complaints_procedure.asp

bengal-stripe

bachey03 wrote: »

.....i purchased an overdraft with lloyds. I activated my overdraft online and was pleased to find out the interest charges were 0%. I received terms and conditions in the post to confirm this.

Are you sure, what you are talking about is an overdraft? You cannot purchase an overdraft, an overdraft does not need to be activated, nor do you get terms and conditions in the mail.

An (agreed) overdraft is an informal arrangement of rolling credit, where the bank allows you to dip into the bank’s money up to a certain point. Although occasionally an overdraft (up to a specified limit) can be interest free, that is not standard. With an overdraft you only pay interest on the amount of money you have actually used.

bachey03

bachey03 wrote: »

bengal-stripe wrote: »

Are you sure, what you are talking about is an overdraft? You cannot purchase an overdraft, an overdraft does not need to be activated, nor do you get terms and conditions in the mail.

I am sure it is a planned overdraft and i applied on my internet banking, a week letter i recieved confirmation with terms of my overdraft.

Premier_2

Something doesn't sound correct here.

As bengal-stripe says, there are usually interest charges on a planned overdraft (unless you have a special account like with their Platinum account which charges a monthly fee.)

You say you were charged interest a week after having your planned O/D approved?
Well interest, which is only charged on what you've actually borrowed, is normally calculated at the end of the monthly billing period, and then you are given notice before they actually debit them.

More details please, if only it's the full response to your official complaint when you receive it

bachey03

Basically i set up my planned overdraft on the 12th August 2010 to purchase a car. I did this online and it took little under a minute to do. I was told that the interest would be 0% and it would be reviewed in a year.

I recieved a letter dated 13th August stating they were pleased to confirm that they had set up a new planned overdraft. On this letter it states 'The rate of interest we will charge on the overdrawn balance is 0.00% per month, giving an equivalent annual rate of 0.00%'

On 27/8/10 i was charged interest. I rang my bank and they said i would need to go and talk to the branch.

I did this and they said they had NEVER experienced this before but would refer it to the internet banking department who set it up.

I received a phone call last week from the complaints department saying a few people had experienced he same thing at this time and as a 'good will gesture' and to pay for my trip to the bank they were giving me 30 pound. They said i would still be charged monthly interest.

At this time i asked them to send me new terms of my overdraft. Two days later i received a leaflet on bank charges but nothing in writing!

And im still waiting for my 30 pound 'good will gesture'!

:mad:

bachey03

Any ideas ??????

:eek:

bengal-stripe

To purchase a car, I presume we are talking about a not insignificant sum of money.

Those are Lloyd TSB’s overdraft rates (depending on what kind of account you have):

http://www.lloydstsb.com/rates_and_charges/current_account_rates
curr_page.asp#personaloverdrafts

If you did receive an e-mail, quoting 0.00 % for an overdraft, did it never occur to you that might be an inputting-error, for example by checking the rates on line?

Any firm has the right of error, particular if the error is as blatant as this one. You cannot hold a firm legally to an obvious one-off error (for example, a decimal point in the wrong place). Even if you could and if the bank would honour this error, an overdraft is payable on demand; so the bank can just call in that 0.00 % overdraft and offer you that same amount of money at the going rate.

If you complain hard enough, you might get some compensation of 30.00 or 50.00 quid for the inconvenience, but that’s all you are likely to get. You cannot expect a loan of several thousand, interest-free ad infinitum (or for an entire year).

bachey03

Thanks for your reply, the overdraft is for 1000 pound and was advertised as being 0% interest. I can accept the bank can make a mistake but i haven't received a valid explanation and am still waiting for my new terms. I have never had an overdraft before therefore did not know what to except.

Premier_2

This has to be one of the most bizarre threads on MSE.

I wonder if anyone else saw this offer the bank made for an interest free OD - I bank with LLoyds and never saw this deal.
And as OD's essentially have no repayment date (unless they withdraw the facility), what you are suggesting is the bank were advertising lending people money for free. Yes they are reviewed annually now, but as long as the account is kept in order, they won't usually pull the facility.

With such a great deal, I'm surprised Martin wasn't including such an unbelievable offer in his weekly email ... unless it never actually existed.
I'll give more advice if some other regular MSE'ers can verify such a deal ever existed, preferably by providing a suitable link.

To request an overdraft to buy a car...? :eek:

bachey03

After doing a bit of research today alot of banks do offer interest free overdrafts for a short period of time (3 months - year).

Check out Barcalys, Nationwide and Alliance and Leicester (cant add links because im a new user?)

Lloyds also offer interest free overdrafts for students and some of their certain current accounts if you agree to pay back within a short timescale.

To suggest that it is made up is foolish as alot of banks do actually offer interest free overdrafts!

And i wasn't asking for advice on how to bank! Thanks