Student account overdraft

moshermum

My son has a student account with Barclays.
Unfortunately he has been unable to get a decent job since leaving university and is presently working for minimum wage.
He is renting a house with a friend and has the usual bills to pay.
He has been told by the bank that he is no longer entitled to the student bank account and the overdraft facility is soon to be taken from him.
He is not yet in a position to pay off the overdraft and the interest charge is currently forty pounds per month.
He has been in touch with Barclays customer services who advised him to ring their debt advice dept. who said they could not help as he was not in enough financial trouble and they advised he speak to customer services again.:mad:
Any advice would be greatly appreciated.:beer:

CLAPTON

usually the student OD is turned into a paid for OD..why are they withdrawing his?

if he can't afford his flat etc why can't he live at home?

if he defaults on the OD this will trash his credit rating for the next 6 years; maybe mum and dad could help put?

opinions4u

The debt advice guys at Barclays won't do anything until the debt exceeds the limit.

He needs to look at his income and expenditure and work out how to spend less and allocate savings to debt repayment.

[Deleted User]

Lets not get too carried away... Going over his overdraft will not 'trash' his credit rating for six years. It's not an ideal situation but it's hardly the end of the world. When I was at uni I went over my OD all the time and less than two years later I've been able to qualify for prime borrowing cards etc.

To the OP, is your son sure that they are closing his OD facility completely? When I finished uni my student account was converted to a graduate account - my OD remained at the same level but it became paid rather than free.

As far as what your son can do about it, I guess the options are limited to how easy it will be for him to get funding to clear the OD. One option might be to get a personal loan (if possible) and then to use this to pay off the OD. It'll still cost him interest but hopefully significantly less than he's paying on the OD.

Calling Braclays debt people should probably be a last resort as entering into any kind of voluntary agreement is likely to have a more significant effect on his credit rating.

putout

moshermum wrote: »

My son has a student account with Barclays.
Unfortunately he has been unable to get a decent job since leaving university and is presently working for minimum wage.
He is renting a house with a friend and has the usual bills to pay.
He has been told by the bank that he is no longer entitled to the student bank account and the overdraft facility is soon to be taken from him.
He is not yet in a position to pay off the overdraft and the interest charge is currently forty pounds per month.
He has been in touch with Barclays customer services who advised him to ring their debt advice dept. who said they could not help as he was not in enough financial trouble and they advised he speak to customer services again.:mad:
Any advice would be greatly appreciated.:beer:

If it's still possible your son may wish to look at getting a graduate account with interest free overdraft, with the intention of transferring the account over from Barclays. The limit works opposite to a student account - it decreases per year as opposed to increase. That should at least give him a temporary reprieve.

JacksterD

How long has it been since he graduated? According to to Barclays' website the Higher Education account provides an overdraft with at least a portion interest free for two years after graduation. http://www.barclays.co.uk/Otheraccounts/Studentaccounts/HigherEducationAccount/P1242557963888

If he's within three years of graduation he might want to consider the Natwest, RBS or Lloyds TSB graduate accounts which will give an extra year of interest free overdraft - with both RBS and Lloyds offering £1000 interest free in the third year after graduation.