Santander Overdraft

simeyb

Hello All - I wonder if anyone has any thoughts on this. I have an authorised overdraft with Santander which has renewed on an annual basis for a number of years. I am now in a position to start chipping away at it, so I called them and they advised that they could either leave the overdraft at the maximum amount (i.e. where it is now) or reduce it to £0!!! No inbetween!!! I asked that as a so-called responsible lender, surely any customer wishing to reduce their indebtedness would be a good thing, but it transpires that if I went through their collections team, I would have to repay at least 5% per month to go on a reducing balance (which is too much for my budget) or if it was a lower amount, they would accept it, but take away my account facilities and mark my credit file (not sure if this would be a Arrangement to Pay or a Default, but either ain't good) - the person on the phone then advised that it looked like as my review was up in May, that the whole of the facility would be removed anyway!!!!!!!! I have escalated this into a complaint and have a reference number and will write to them, but should I be moving my account somewhere else? What happens if I just leave the debt behind and then make an arrangement with their collections people? Any thoughts welcome - all I'm trying to do is reduce my overdraft - never though it would be this difficult!

simeyb

Right - update - spoke to someone a little more helpful at Santander Collections - at any time I could go onto a reducing overdraft with them - they would stop charging any monthly interest or fees, which in my case would be £20 per month, and provided the amount the overdraft reduces each month is 5%, so that it's all gone in a maximum of 20 months, then you get to keep all account facilities and no issue re credit referencing. For example, if the overdraft is £5k, then a monthly reduction in the facility of £250 will get you there in 20 months - you can do more, BUT, if you can't do the 5% then they may consider a lower offer, but all account facilities will be withdrawn and an AP marker put on the account. Given I think that my facility will get withdrawn from 1 May (next review) then I have to bite the bullet and go the 5% route - (i) I want rid of my overdraft and (ii) have spent too long mending my credit file so i can get a better mortgage next year!

Hope thats helpful - although what a nightmare - my OH works at a well known Building Society and if someone comes into the branch and asks to reduce their overdraft by any amount, he keys it in and 48 hours later - ta dah! Just as it should be.

giorgio992

simeyb wrote: »

Right - update - spoke to someone a little more helpful at Santander Collections - at any time I could go onto a reducing overdraft with them - they would stop charging any monthly interest or fees, which in my case would be £20 per month, and provided the amount the overdraft reduces each month is 5%, so that it's all gone in a maximum of 20 months, then you get to keep all account facilities and no issue re credit referencing. For example, if the overdraft is £5k, then a monthly reduction in the facility of £250 will get you there in 20 months - you can do more, BUT, if you can't do the 5% then they may consider a lower offer, but all account facilities will be withdrawn and an AP marker put on the account. Given I think that my facility will get withdrawn from 1 May (next review) then I have to bite the bullet and go the 5% route - (i) I want rid of my overdraft and (ii) have spent too long mending my credit file so i can get a better mortgage next year!

Hope thats helpful - although what a nightmare - my OH works at a well known Building Society and if someone comes into the branch and asks to reduce their overdraft by any amount, he keys it in and 48 hours later - ta dah! Just as it should be.

Have you checked your credit file since this? Has an arrangement to pay marker been put on your file?

DebtClearer

If they are cancelling all those fees it sounds like it will be an arrangement to pay. I have the same OD with Santander and it is £20 however far I am into the OD.