Bank overdrafts...can they help

sambodidly

Hi
I posted a few days and was very very thankful for your advice.

I was wondering. I have a 3k overdraft in which im about 2.5k into it :-( but have another bank account elsewhere that is never overdrawn as nothing much goes in/out of it but it is a current account.

If I transfer my wages/credits and dd outings to that account and have nothing in/out of my existing bank acccount with the overdraft, what is the likelyhood of my bank allowing me to pay a monthly amount over the next year to pay off the overdraft.......and will they; still charge me silly fees?

I know I need to ask them but thought id run it past you guys first

Thank you.

sambodidly

Also

Ive been offered an extention on my exisiting loan to cover all my debts, and have just the one debt.

Sound advice or crazy???

I cant decide what to do :-(

GeorgieFTB

Sam

First off the overdraft, you can move to the other account, be aware that the bank with the overdraft could get funny with you and call in their overdraft, if they do you will have to negotiate with them the same as any other. You could try to talk to the bank to see if they will decrease you limits slowly so you are paying back and cannot re-borrow the money...

Will it help you to start fresh with a zero balance? If the answer is yes, I would do it after you have set up everything into the new account, just so you don't end up with no money and no overdraft.

The loan is another issue... most on here will caution against consolidating your debts. This is because they have done it, then not cut up the cards and just run up the debt again... you need to figure out why you ran up the debt in the first place and fix that cause, if it was a one-off or just being lazy or compulsive shopping (sorry I did not read you previous thread)

Take a look-see at the loan and figure out what woulds be best/cheapest for you (not nessesarily the same thing)

Gx

sambodidly

Hi G

If I do move to the other account and just leave the overdraft I am absolutely willing to pay it so would hope they could arrange a payment plan...........buts its LLoyds TSB and they are not friendly at all :-(

At the moment, I am swaying towards the consolidation only in that I know that with just 1 monthly debt at a fixed amount and I WILL BE CUTTING THE CREDIT CARDS completely.

The debts are a cumilation of being silly, overspending and living a life of luxury for the past 5 years.

The loan would pay off all my debts, be over 4 years and at an affordable price. Its not with any consolidation/debt management plan, its with my existing Loan company, NOT secured on my house, and could be in my account by Monday.....................so tempting!

DevonGirl

Might have got the wrong end of the stick here but what's stopping you being ultra strict and working out how much you can afford to 'not spend' a month? So if your o/d is £2.5k and you can afford to not spend £300 a month, then in eg September, make sure you don't go down further than £2,200, then the next month £1,900 etc and then in just over 8 months you could be totally debt free? You wouldn't need Lloyds TSB's permission to do this, and you could ring up every month to reduce the overdraft, thereby cutting out temptation. If the loan you are looking at has a payment of £300 (using this example) which you believe you can afford, why not pay that directly against your debts by not spending it IYSWIM.

Just an idea, but seems far easier being strict with yourself than taking out a 4 year loan which you are committed to. Plus, if you did have a bad month, you can always dip back into the o/d if you haven't asked the bank to lower the limit.

The reason people are so wary about consolidation on this site is because life happens and no matter how determined you are, if you haven't addressed the reason for your overspending, or if life happens to deal you a bad hand one month, you can find yourself needing extra money again, and before you know it you'll have a loan, plus extra debt. Sooo many people have done it (including me ) and it really is a highway to heartache.

sambodidly

Hi DevonGirl

I understand completely where your coming from and take in everything you have said.

My debts are actually almost 10k :-(

I have 2.5k Overdraft
2 CC @ £2000 total
1 Existing Loan of £5750

I have been offered a Loan of £9500 from my existing loan company to pay all those off and have 1 monthly payment per month which is affordable. This is why its so tempting.

I know what I owe add's up to 10,250 but I have 1k due in my bank on Friday which would clear the remaining £750 debt.

I have already just cut the cards up :-)

DevonGirl

Hi Sam

Ah, ok, so there's more to this than your opening post .
What was the £5750 loan for, can I ask?

DG

timbstoke

Check the interest rates and do the maths to figure out whether you'd be better off with the loan, or just clearing everything bit by bit. As for moving bank accounts to make paying the overdraft easier, that's what I've done and First Direct haven't said a word.

sambodidly

Hi DG
Yes there is sorry. I did post on Monday and thought you might be Psychic and know that. Sorry :-)

The 5750 loan was originally 6500 and that was for a car/sofa etc. Ive never defaulted paying.........yet!
The credit cards and overdraft im in is down to pure and simple careleness/silliness. Overspending on luxuries, breaks/nights out etc etc.

My exisiting loan has 2 years left to run.
1 CC is 0% until March 2012 (1250) and the other with £800 on will start charging APR in Sept 2011 ...........so more charges!

My overdraft is driving me insane...... I can never seem to get out of it and its just keeps going up and up :-(

I do have a Caravan thats worth around 2.5k so wanted to sell this to pay the o/d, but didnt want it to take months to sell to pay the o/d off.

Sorry its garbled, im all over the place with knowing what/why to do!