Halifax Swiftly Withdrawing Our OD

Venusflytrap

My husband and I opened a Halifax reward current account in March '11 and were given a prearranged OD of £250. We never used it and in November I reduced the amount to £100 (didn't cancel, just in case...).

Now we have just received a letter from Halifax saying that, due to an assessment of our financial circumstances, the prearranged OD will be withdrawn altogether from June.

Granted, we have not relied on the OD and simply spend within our budget, so I wonder if it is being withdrawn because we aren't viable customers or perhaps Halifax is simply tidying up its balance sheets? I thought ODs were best used only rarely as an emergency fallback and banks welcomed customers who did just that?

Has anyone else in our position gotten such a letter recently?

pcombo

Is it your main account where all credits from work etc go into.

Or just a day to day spending account? You shoulda maybe used it and replaced it right away to save it being idle. Maybe they need to allocate the OD to someone else, since your not using it.

jonesMUFCforever

IMO just a general tidying up excercise.
Something similar happened to me with their credit card - reducing the limit as i was not using it a lot. A phone call got my limit back and if you have a clean credit score I suggest you try the same.

Venusflytrap

pcombo wrote: »

Is it your main account where all credits from work etc go into.

Or just a day to day spending account? You shoulda maybe used it and replaced it right away to save it being idle. Maybe they need to allocate the OD to someone else, since your not using it.

No, our salaries don't go in; we just credit it with circa £1400 monthly for rent, bills and household expenditure. All our DDs and SO for rent and utilities are set up here as well.

I guess as we didn't use it Halifax assessed that it was a wasteful allocation of credit - fair enough. Just surprised as I also have a CC with them which I use almost every month and repay in full.

So long as the OD retraction doesn't affect our credit worthiness, we don't mind. Won't bother requesting that it be reinstated as we cannot guarantee that it will be used (at least not in the way Halifax want it to be).

jonesMUFCforever

Unfortunately overdrafts are most needed when something adverse happens in your life such as your main bank cocking up your standing order to Halifax and you get a load of unpaid direct debit charges as well as a bad credit score.
A phone call won't cost you much just as long there is nothing in the background which you have not mentioned here.

jason1231972

Have you made any credit applications elsewhere recently? I ask because a while back, my partner was approved a bigg-ish personal loan with HSBC. Within days (the letter being dated the same as the HSBC loan approval), Barclaycard wrote to her to inform her that her limit was being cut due to changes in her financial circumstances. She reported vague memories of Barclaycard doing the same on previous occasions, too.

Not 100% the same situation, but a possibility?

ses6jwg

a simple way for banks to improve their capital ratios and reduce levels of unsecured lending on the books is to pull peoples overdrafts its happening across the industry

Venusflytrap

jonesMUFCforever wrote: »

Unfortunately overdrafts are most needed when something adverse happens in your life such as your main bank cocking up your standing order to Halifax and you get a load of unpaid direct debit charges as well as a bad credit score.
A phone call won't cost you much just as long there is nothing in the background which you have not mentioned here.

Nothing has changed with either of our finances. If anything we have been saving more, although this year we have made quite a a few large purchases on my AmEx, Halifax and NW CCs for flights, hotels and music equipment as we have a busy summer ahead.

It may well be that putting both our expenditures on my CCs alone, and Halifax knowing that I am on a part time salary, looks to them that I am overstretched when in fact we pay back everything in full each month from both our p/t incomes (circa £27k after tax).

Probably best for us to start spreading costs on both my husband's and my CC (if only he bothered to know how CCs work).

Mikeyorks

Venusflytrap wrote: »

I guess as we didn't use it Halifax assessed that it was a wasteful allocation of credit - fair enough. Just surprised as I also have a CC with them which I use almost every month and repay in full.

I doubt it. I have a £1500 overdraft with Halifax which they simply maintain. It's only there in case I make a mess of moving money in to meet DDs (I run the account with a close to zero balance). I've moved in to it, marginally, during a working day on the odd occasion -and restored the balance by evening

My wife has a £1000 overdraft - which again they simply maintain. It is never used. Her account is funded monthly and then [STRIKE]frittered [/STRIKE] dissipates over the month.

I also have their Clarity CC ..... which is very well used, and paid in full monthly.

We never used it and in November I reduced the amount to £100

........ I think you will find that was the catalyst. I would get the original £200 restored ..... a useful buffer if you miscalculate?

Venusflytrap

Mikeyorks wrote: »

I also have their Clarity CC ..... which is very well used, and paid in full monthly.



........ I think you will find that was the catalyst. I would get the original £200 restored ..... a useful buffer if you miscalculate?

Too late. I already cancelled the OD online yesterday.

Rather dump them first!

jennifernil

ses6jwg wrote: »

a simple way for banks to improve their capital ratios and reduce levels of unsecured lending on the books is to pull peoples overdrafts its happening across the industry

In that case, I am surprised they haven't pulled ours. It has been £2500 since we joined Halifax in 2003, we have never used it.