£2K Santander Overdraft

facing_up_to_it

Hi everyone & good morning,
I'm wondering if anyone can help with the following - as title says I have a £2K overdraft with Santander that's up to its limit, I can never clear it as when my wages go in I'm immediately in the red before anything comes out. It's been like this for far too long. I'm not impressed with Santander's customer services ( they're probably not impressed with me either ) and I want to change bank. I can clear the overdraft in full March 2012 but I didn't want to have to wait that long to move. What action would Santander take if I opened a new account with another bank and transferred all my transactions ( payments in, direct debits etc ) and left the account with the overdraft owing of £2K? I would make a payment each month to the account to reduce the overdraft and then finish it totally March 2012. This overdraft or any of my bank account details do not appear on my credit files but I'm thinking that's because I've had it donkeys. I just want to jump ship now if I can but if I can't then I'll have to be patient until next year. Has anyone been in this situation?

facing_up_to_it

I ran out of space to say 'thank you'

Yargo1

Hi. i have similar with natwest.. have managed to open a nationwide current account.. but like you, scared to make the switch as yet in case natwest get funny.... will await your other replys with interest. cheers

Buffythedebtslayer

THere is no problem with you opening another bank account, I have 2 different current accounts (bills and spending money).

I would be VERY CAREFUL with Santander tho, they are scum in my opinion. I had a current account with them which i had my wages paid into and used for about a year. When Hal8fax started the pay you a £5 thing I moved my wages to them. I didn't realise that my Santander account would then be "underfunded"(despite me paying money in to cover direct debits still on that account) and they charged me a fiver a month for 4 months before I realised what was happening - they never wrote and explained and I never could find it in the terms and conditions.

I would do this

Santander account (or Natwest account) - pay wages in - Standing order to new account to pay majority of wages to them, leaving a small payment to the overdraft. Therefore you are meeting the requirement to have your wages paid in and paying off your OD without them having a reason to get funny with you.

you could even open the hal8fax account and get the extra fiver!


does that make sense?

or I guess you could ring the bank and ask them but they would probably turn the OD in to a loan with more interest? so maybe a world of no to that!

must go eat

Buffy xx

Yargo1

Cheers Buffy, will look into doing that. its gonna be a hassle not using the switch service in terms of direct debits but i am sure if they got wind of me changing they will either demand all money in one go or like you say .. turn into a loan.

Oneday77

Have you asked Santander to reduce your OD by say £50 a month automatically, assuming you can afford £50.

What ever you do, don't give them any wind of you switching. Otherwise as its an OD which is payable on demand they may swallow your wages before you get it paid elsewhere.

Jebrelli

Oneday77 wrote: »

Have you asked Santander to reduce your OD by say £50 a month automatically, assuming you can afford £50.

I tried to do something similar with HSBC, but they said I couldn't change my overdraft limit more than once every six months.

Obviously this won't help the OP who wants to switch immediately, but I set up a standing order to a separate account and then paid my overdraft off in chunks every six months (and reduced the limit at the same time).

Buffy's suggestion sounds good - get your wages paid into Santander and then transfer (minus any overdraft payment) the money immediately into a separate account. Then, as far as Santander is concerned, that account is your main account and they won't come chasing for the overdraft.

facing_up_to_it

Hey guys, thanks for all your replies, very much appreciated. Sometimes you can't see the wood for the trees but I reckon Buffy that you've hit the nail on the head. I think I'll plough ahead with a new account, allow wages to be paid into Santander, then transfer majority out and leave £50 or whatever I can afford that month to pay off overdraft, move direct debits to new account. I'll also bear in mind to try not to set off any alarm bells ringing with Santander ( I should imagine if I pulled the rug all in one go then they would ask for the overdraft to be paid in full which I cannot afford to do right now ). All in all sounds like a cunning plan. Can't wait to be shut of Santander, suppose I'm being impatient but I am sick to the back teeth of them. Once again thanks for all your constructive advice, it's good to know you're not on your own x

david39

Yes, you have to be very careful here.

Santander can pull the plug on your overdraft without notice.

They are probably flagging it now as an account to watch because their only security that they can get their money back from you (other than by legal action) is the fact that the overdraft reduces to zero when your salary is paid in

If they have any doubts that this situation will deteriorate they will wait until the next time you salary comes in and immediately use it to pay off the overdraft and cancel it, effectively leaving you with no money for a month.

Opening another bank account will indicate that you are "up to something" and make them uneasy so, if you have arranged for a transfer from the Santander account to the new one, they will take the money for themselves and not do a transfer.

My advice to you would be to leave things exactly as they are at the moment until next year when you intend to clear the overdraft.

ElmerFudd

My Santander account has been overdrawn for over a year now (agreed overdraft but still). As long as I pay in £500 a month (I then transfer the money out after a week) they only charge me £10 for being overdrawn. Since £10 is still a more reasonable fee than some of my credit cards it's fairly reasonable. You best check your terms and conditions to make sure you don't need to pay a set amount each month before you transfer to another bank.

Racheldevon

Santander are a nightmare & have just started charging me a daily fee for using an agreed overdraft facility. I am in the process of changing to First Direct, but I have a £550 overdraft with santander - i asked them if I could set up an automatic reduction of £50 a month some time ago & they said this wasn't possible. However, it has been possible to call each month and reduce it, so you might need to do that instead perhaps. I am using the easy switch service for direct debits etc, but as this is due to take place on 17th june, I'm hoping it should be covered by my disposable income, it'll just be a tight month - just be cafeful like others have said that it's not all swallowed up if they get wind of you switcing