First Direct bank account free £250 overdraft question.

meer53

"Thats not what I've got here from FD. They don't charge me anything per year, but they do state "We may decide to charge you £25 for renewing your annual overdraft, depending on your usage of your overdraft.". I've never used my overdraft, so I've never been charged."

They "may" decide to charge you to renew it. (Usually if you've requested informal overdrafts during the 12 months)

It doesn't mean that if you use it you will be charged. I use most of my £1000 overdraft most months (same as Eschaton does) but am never charged when it's renewed.

innovate

nealbanks wrote: »

I've moved all of my direct debits and wages everything etc to Nationwide.

nealbanks wrote: »

First directs loss Nationwides gain I guess.

Seems a bit of a rash decision to change from one outfit with a free £250 overdraft to another who has a £0 free overdraft, and all that because you can't manage to stay within your agreed overdraft limit.

Even more rash, when you actually look at the Nationwide overdraft charges. e.g.

A payment from your account takes you into an unarranged overdraft by less than £10. You are overdrawn for one day during the month. £15 charge

A payment from your account takes you into an unarranged overdraft and you make another payment from the account while you are overdrawn. £50 charge

seriousDFW

Gromitt wrote: »

FD give (most) people a fee-free £250 overdraft, but they reserve the right to charge you £25 per year should you regularly use it, or £25 + interest for each month in which you exceed your fee-free overdraft.

If you have no activity, you may get the £10/month banking charge, followed by a request to immediately repay your overdraft (they can request this at any time).

I normally agree with everything you say Gromitt, but I don't think this is correct either. You aren't charged £25 for going over the fee-free £250 portion of the OD. You would only be charged if you went over the agreed limit, which I think the standard amount is £500, which is what I have.

I have dipped into my fee-free OD and the interest-paying bit a few times over the last 18 months and I wasn't charged to renew and I haven't been charged anything to use the OD. I had an average debit balance of £16 according to my annual summary statement, if this is relevant!

Gromitt

seriousDFW wrote: »

I normally agree with everything you say Gromitt, but I don't think this is correct either. You aren't charged £25 for going over the fee-free £250 portion of the OD. You would only be charged if you went over the agreed limit, which I think the standard amount is £500, which is what I have.

Both the website and my overdraft renewal letter says the standard is variable, and upto £500. It used to be £250. I've had my account for over 10 years and never used my limit, so probably why they never increased it. It remains that only the first £250 is fee-free.

The website (www2.firstdirect.com/1/2/rates-and-charges/overdraft-charges) says that the first time you go over your limit by £10 or less is free as long as you have not gone over your limit in the previous 6 months (ie, applied for an informal overdraft).

System

First Direct's internet banking is somewhat primitive.

It displays the ledger balance [and unlike most other banks] only displays some kind of available/running balance if you try to make a Faster Payment. I also found that debit card payments take a day or so longer to debit the account than other providers.

Whilst I don't think running too close the wire is a good idea; First Direct's systems certainly don't make money management any easier.

As for the overdraft question; if FD did decide to cancel the facility on the OP's account as long as he/she repays when requested it wouldn't affect the credit file in any negative way.

meer53

Debit card payments don't take any longer to debit than any other banks.

tkwad

it was £25 per item presented for payment when in an informal overdraft situation...
if you went over by 20pence you would be charged £25.00, if before you noticed or were able to correct the balance another item presented, you would be charged another £25.00...

Meadows

nealbanks wrote: »

My question is what would happen if I left the bank account sitting with no activity £247 overdrawn for a long period of time?
The overdraft is supposedly a free overdraft no interest charges. Would there be some kind of clause to say I have to put so much in there each month would they find someway to sting me with another charge. Advise appreciated. Thanks.

There T&C's when you signed up to the bank clearly state:

£250 interest free overdraft

We give you an automatic £500 formal overdraft when you open your account - and the first £250 of your overdraft is interest free. We will charge you Interest on overdrafts above £250, and we may apply an arrangement fee if you request an overdraft more than once every six months.

Banking fee

You must pay our £10 Banking fee for each month or part of a month that you hold a 1st Account unless we agree to waive the fee. If applicable, the fee will debit your account monthly in arrears.
Banking fee waivers


You will not have to pay the Banking fee:

• for the first six months following account opening
• for any month in which you:
  • pay into your account* (other than by internal transfer from another first direct account) a minimum of £1,500 or you maintain an average monthly balance on your account* in excess of £1,500 (month means calendar month and we will work out the average monthly balance by adding together the end of day balances for each day during the month and dividing the sum by the number of days in the month) or
  • hold a first direct mortgage, credit card, personal loan, savings account (*excludes Regular Saver Account), First Directory, or first direct car or home insurance policy;
• in relation to any second or subsequent 1st Account in the same name. (If you hold a sole and joint account, your joint account will not be considered to be in the same name unless all joint account holders are the same);
• if your account is inactive for more than 90 days and the balance of your account is less than £10.

* Where multiple current accounts are held, accounts will be considered individually in respect of balances and credits received and will not be aggregated when assessing whether a fee is payable.

System

Many years ago I had similar problems and it all came to a head when I went through a divorce - I had no credit facilities at all and had to learn to live within my means or I wouldn't be able to buy petrol to get to work.

I now know to the exact penny the balances of my accounts. I use an app called PocketMoney on my iPhone and it lets me enter standing orders and direct debits which I set as 1st of the month even though some come out later - so I can see what I actually have left to spend. Every time I withdraw from my account I enter the transaction into PocketMoney, and as soon as I see that transaction online I mark it as cleared so I always have two balances - the balance as seen at the bank (the cleared balance) and the real balance which is the cleared balance plus any transcations which haven't reached the bank yet.

It really isn't a drag to do this and it helps me feel in control. Mind you, if the cleared balance accordng to PocketMoney and the bank differ, even by a few pence I spend some time working out what I have missed, lol.

Cuckooclock

I have been with FD for years not out of any misguided loyalty, but because I have found them very good.
When we moved I thought money may be a bit tight, so rather than go over my free overdraft limit, I phoned the bank & they suggested a temporary overdraft could be useful. So if you think you may go over,before you do, contact FD and they may help its cheaper than charges.:)