Switching Process Natwest to Halifax

daezle

Hello, im a student nearing graduation and currently hold 2 current accounts with natwest, one current plus and one student. As soon as i am earning above £1000 p/m i want to switch to a halifax reward and was wondering about the switching process.

My question is this, does the transfer process simply switch ONE account? This is important because the student account has an interest free overdraft of £1500 which i dont intend to pay off until i start incurring charges.

I only ask this because i read somewhere that this switching process reflects poorly on your current bank, and knowing natwest they may demand i pay it back straight away. My direct debits are all attached to this student account which i top up just before they come out. Or could I switch to having a halifax reward AND a halifax graduate overdraft?

Anyone who has experience of this switching process would be a great help, thank you.

PNPSUKNET

why not switch the account yourself, then they cant mess anything up

jambosans

I agree with PNPSUKNET, unless they are paying you to use their switching service, do it yourself. As it stands, I don't believe their running any online switching incentives. You could try branch, it tends to be an on-going promotion, normally they offer you £50 to switch. If you do allow Halifax to perform the switch on your behalf, keep an eye on both accounts during the whole process, ensuring there is money in both accounts to cover any stray Direct Debits, etc. that haven't transferred promptly.

daezle wrote: »

My question is this, does the transfer process simply switch ONE account?

You can transfer from more than one account - i.e. transfer regular debits from two accounts to one account.

daezle wrote: »

This is important because the student account has an interest free overdraft of £1500 which i dont intend to pay off until i start incurring charges.

I hope you have just worded this poorly. If your income affords it, I would strongly suggest you repay your overdraft while you have the luxury of it being interest free. It's worth noting NatWest offer a Graduate Account with (gradually reducing) interest free overdraft for an additional three years.

Advice: Budget yourself over three years* to pay down the overdraft completely. Switch to Halifax as your main banking providing; start earning your fivers; and setup a standing order to your student/ graduate account each week/ month. If you have a good month you can pay extra into the overdraft. Paying off a £1500 interest free overdraft over three years is approximately £41.67 per month.

Separating your day-to-day banking from the overdraft and setting up a fixed amount standing order portrays the overdraft more like a loan than a perpetual debt. It's paramount if you follow this advice you stop using the student/ graduate account - e.g. no cheeky wee tenners from an ATM on a Saturday night using the debit card.

daezle wrote: »

I only ask this because i read somewhere that this switching process reflects poorly on your current bank, and knowing natwest they may demand i pay it back straight away.

Very unlikely. I would imagine the transfer of data between the two banks will be largely automated, any human intervention will differ from those who deal with lending/ underwriting your overdraft.

daezle wrote: »

Or could I switch to having a halifax reward AND a halifax graduate overdraft?

Halifax do not offer a graduate account, so that options out of the window. Obviously the decision is yours to make, but if you follow my advice above it keeps things simple. Keep your NatWest Student Account, and when the time comes, change it to their Graduate Account. Transfer your debits and credits from the Student Account and Current Account Plus to your new Halifax Reward Account. At this point, you could simplify things further by closing the Current Account Plus (although there is no requirement to do so, even when using Halifax's Switching Service). Halifax then becomes your main account, and the student/ graduate account with attached overdraft is regarded as nothing more than an interest free loan.

There's also the added advantage of banking with an institution that holds no connection to the RBS Group (who own NatWest). If you fell into arrears with your overdraft, or NatWest decided to remove* the facility, they could offset in-credit funds from another NatWest account to repay the debt.

*Overdrafts are repayable on demand, so having a graduate account does not guarantee a further three years interest free. If you can afford to pay the overdraft off in a year, then do it, but make sure you budget realistically. For more help and advice, you can post on Debt-Free Wannabe.

daezle

Thanks for your reply. I should stress though that I do have the money to pay off this overdraft now, but because I am planning on moving to london I have this money saved up as an emergency fund.

You say its highly unlikely for natwest to demand their overdraft back in this situation, yet they have done so to 3 of my friends who have had real trouble with them (admitted they did not use the overdraft as their current account and just withdrew the money, but using it as a loan would put me in the same situation).

Id rather pay off the limits a month before I have to rather than a direct debit, since i am usually a good planner. Sorry i think i got confused with alliance and leicester graduate account for a second there.

But generally you have answered my question, thank you very much!

jambosans

daezle wrote: »

You say its highly unlikely for natwest to demand their overdraft back in this situation, yet they have done so to 3 of my friends who have had real trouble with them (admitted they did not use the overdraft as their current account and just withdrew the money, but using it as a loan would put me in the same situation).

Generally speaking, you are far more likely to have an overdraft removed if it is left unfunded for a prolonged period. A regular credit via standing order is far more reassuring to NatWest than "pay off the limits a month before I have to". I would also suggest, as is a condition with many student accounts (sometimes even normal current accounts) NatWest expect a regular credit.

daezle

jambosans wrote: »

Generally speaking, you are far more likely to have an overdraft removed if it is left unfunded for a prolonged period. A regular credit via standing order is far more reassuring to NatWest than "pay off the limits a month before I have to". I would also suggest, as is a condition with many student accounts (sometimes even normal current accounts) NatWest expect a regular credit.

Dont forget i already meet those requirements via 5 direct debits and a credit to pay them off each month

jambosans

daezle wrote: »

Dont forget i already meet those requirements via 5 direct debits and a credit to pay them off each month

I was speaking hypothetically from the standpoint of my previous post where I suggested you transfer your main banking relationship to Halifax.