At wits end with Halifax charges, please advise.

iclayt

Background:

Unemployed Nov 09 - Oct 10.
Worked Oct 10 - Jan 11.
Diagnosed with cancer Jan 11
On ESA until July 11 - went back on JSA
Unemployed until Oct 11
Now working 16 hrs a week, temp until end of Feb 12
Expect to end up on JSA again, reducing income from £97 to £67 a week, though I am trying to find work.
Also undergoing tests for cancer again so may end up back on ESA.

I have a Halifax account that is overdrawn by just shy of £1000 which is subject to their ~£30 monthly charge. I pay off what I can afford - ~£50 a month. This isn't an arranged payment through the bank, it just goes out my Natwest wages account into this one. So after charges, ~£20 a month is paid off. This is ridiculous - it's going to take me forever to clear the debt.

Throughout the whole of the past few years while being a PG student working 14 hrs a week, then unemployed, then unfit to work, and being on a ridiculously small income the whole time, Halifax have never once been able to help me out in any way by coming up with a repayment schedule, or freezing anything. Even when I've virtually been in tears on the phone it's like speaking to a droid. They're not interested in branch. They just want it paying off, which I want to do, but soon they are planning to reduce the amount I'm able to be overdrawn by half - leaving me in unauthorised overdraft territory and I dread to think what those charges are.

I wiped my only savings in order to halve the overdraft debt and I'm wondering why I bothered really.

I'm starting to think it'd be better if I stopped paying the £50 monthly, refused to pay a penny, let the account go dormant and even let it go to debt collection - at least then i'd have a chance of freezing the amount and paying it off quicker.

Please, does anybody have any idea of how to negotiate with them so that I'm paying off my actual debt rather than their charges?

OR is there any way of switching the debt elsewhere so I'm at least paying less? I have tried to get credit cards but keep getting rejected. I have checked my credit score through Equifax and apparently it is very good!

I'm getting desperate, does anyone know if there's anything I can do?

ses6jwg

You try switching to a bank that offers a 0% overdraft, aim to match your existing, then use the 0% overdraft to pay the Halifax overdraft and close the account. It's a short term solution, but for 12 months you'd get 0% on your overdraft giving you chance at least.

I work for Santander and have done a few switches in the same situtation as yours. They'll aim to match your overdraft, unless you've had any defaults and as long as you are on the electoral roll you are unlikely to get declined. I matched a 3.5k Natwest OD for a young lad not so long ago. He was paying £43 a month OD charges now he pays £0.

iclayt

Thanks for replying. Problem is I'm not convinced I'll get another overdraft elsewhere. When I applied for the current account with natwest to pay my wages into (paranoid Halifax would take them) I applied for an overdraft but wasnt given one. Even nearly 6 months later with wages going in every week they still won't offer me one, rejected every time.

premierfella

http://www.adviceguide.org.uk/index/your_money/money_management_index_ew/help_with_debt_index_ew/options_for_dealing_with_debt_ew.htm
Clearly as soon as Halifax decide to reduce your overdraft to put you in an unauthorised overdraft, this overdraft will become unserviceable anyway, so you are doing the right thing to try and do something now.

I assume that when you say you have talked to Halifax, you have called the Money Management Team 08456 03 90 50 - http://www.halifax.co.uk/managingyourmoney/managingdebt.asp
- who I guess would be the staff who are most likely to have some ability to agree an arrangement to pay.

If you have had no joy there (which is possible and would be due to you being able to pay at least the £30 per month fees at present) your options narrow. Your suggestion of simply stopping credits to the account could go one of two ways - Halifax might simply default the debt and trash your credit rating whilst adding costs, or alternatively it could push them into agreeing an arrangement to pay. I would seek assistance from CAB before going down that route.

In terms of sources of credit (if you believe that you will still be able to cover interest and capital repayments when back on JSA), have you checked whether there is a good credit union in your area. Some credit unions are more able to assist than others in terms of providing a loan, but a good one will have assistants that deal with debt management issues regularly and might be a good source of advice (even if they can't immmediately help).