Can banks take money from your account?

snappy_badger

Hi everyone - I've been lurking for a while and finally need to ask a specific question so I'm hoping someone can help me!;)

I'm in the process of setting up a DMP with CCCS. One of my creditors is Halifax, who are also my bank account holders, so I was advised to move banks in case they try to take any money I have in my account to pay back some of my debt. That's fine - I moved the small amount of money I had to my old Barclays account which I'd never closed down.

My problem is that I am self employed and I have a business account with Abbey - which is linked to my merchant services facility. Another of my creditors is Cahoot who I've just discovered are part of Abbey. I'm worried that Abbey will steal the money I have in my business bank account (which is several thousand £'s in deposit payments at the mo). I don't really want to change business accounts as Abbey does free business banking and I've had no problems with them.

I was wondering if anyone has experienced their bank "stealing" money from their accounts because of missed credit payments/DMP reduced payments? Or am I worrying about nothing?

sgx.saint

It does depend on the T&C you signed when opening an account.

But the general rule of thumb when it comes to off-setting your money is that if they are part of the same group i.e. Abbey and Cahoot then they can indeed take money from one part of the banking group and off-set it with another part.

I wouldn't take the risk and I would move accounts. That's my two pence anyway.

snappy_badger

Thanks sgx.saint. This is my thinking too - that it isn't worth the risk. But the hassle of setting up a new business account is what is putting me off. I'm also worried that in a few days time when all my creditors receive the letters I sent them explaining my financial situation and that I've cancelled their direct debits/SOs and the proverbial hits the fan I won't actually be able to open a new account.

sgx.saint

Your credit rating won't be impacted as quickly as that, it takes at least a month to update your credit file, plus you won't receive default notices straight away.

So assuming your credit history is currently fine, then you should be able to open an account say tomorrow no problem at all.