HSBC overdraft

NoAngel

Hi

I racked up a big overdraft on my HSBC student account a few years ago. After finishing uni I opened another account with a different bank and pay a small amount into my HSBC account each month to gradually clear the overdraft. However HSBC have recently said that as I'm not using the account regularly and not paying much into it, they will cancel my overdraft and I need to pay it off immediately. I called to say I can't afford this and they said that if I pay in £600 per month then I can keep it (the £600 can be used, they aren't reducing my OD by £600).

My question is, how long does that £600 need to be in there for? Could I transfer it in and then take it back out a couple of days later to pay my direct debits from the other account?

Thanks.

You-kip

It could be in for 60secs as long as £600 reach your account every month it wouldn't matter how long it was in for.

Mishomeister

Why do you think banks do free overdrafts for students? To altruistically help them?
They expect to make money from you when you become a graduate on a decent salary.
As soon as you became graduate you have dumped HSBC and get your salary paid elsewhere.
It all therefore means HSBC has made a financial loss on you. I believe you are on their Graduate account which has an interest-free overdraft so I can understand why they want to remove your overdraft it is because they have made a loss from you.

NoAngel

It's not interest free, I pay around £25 per month. It's my choice who I bank with. They would only allow me to decrease the overdraft every 6 months and therefore it was easier to have another account and pay into my HSBC one to pay off the OD gradually. And I wanted a joint account with my husband which I don't think is such a crime.

R_P_W

You're right. It is your choice who you bank with. It isn't a crime to have a joint account with your husband elsewhere either.

I can understand HSBC though, if you are not paying money into the account to take you out of the overdraft then they can recall the debt.

So I think can can transfer in and out quickly - but maybe worth increasing the rate you clear this overdraft down? When you say massive how much are we talking and how much are you reducing it by each month?

Thrugelmir

NoAngel wrote: »

It's my choice who I bank with.

The overdraft is also repayable on demand. So the bank has a contractual right to request the money. You can't walk away from debt. Why not obtain a loan to clear the overdraft.

NoAngel

I honestly never expected not to have to pay it back and never thought their asking for it back unreasonable, I merely can't afford to pay back the entire thing in one go. I said a big overdraft of £1500, so nothing terrible really and I was putting £250 in each month before - £80 for a HSBC loan repayment (took a loan a couple of years ago to cover emergency flights abroad when my sister got sick on holiday) some towards HSBC credit card repayment (small amount of £300 borrowed post wedding) and the rest was covering the interest and reducing the amount owed on the overdraft.

I really do realise they've been reasonable here and my original post never said that I thought it was unfair. I just couldn't afford the full amount this month. I'm not sure that taking a loan to cover it would be sensible though as the first £1000 is still interest free and a loan would be more expensive. I have however put down for lots of overtime at work for some extra cash to blitz this once and for all so fingers crossed HSBC overdraft will be gone in a few months

FireWyrm

Well, if you can afford the £600, why dont you just bite the bullet and give them three consecutive payments and pay them off once and for all?

Overdrafts are always payable on demand - a pain in the proverbial but they are well within their rights. Also, take it as a lesson, we're noticing more and more cases over at DFW where banks seem to be arbitrarily calling in overdrafts on people who clearly are still using the account so beware. It seems the banks are dumping people deep in overdraft and dont seem to care about the hardship they cause as the victim scrambles to pay it off and open new accounts elsewhere.

NoAngel

FireWyrm wrote: »

Well, if you can afford the £600, why dont you just bite the bullet and give them three consecutive payments and pay them off once and for all?

Overdrafts are always payable on demand - a pain in the proverbial but they are well within their rights. Also, take it as a lesson, we're noticing more and more cases over at DFW where banks seem to be arbitrarily calling in overdrafts on people who clearly are still using the account so beware. It seems the banks are dumping people deep in overdraft and dont seem to care about the hardship they cause as the victim scrambles to pay it off and open new accounts elsewhere.

Thanks, but if I could afford the £600 my original question wouldn't have been 'how long does it have to stay in there for' as I can't afford the full £600 and it is needed to pay direct debits. As I said I'm doing some overtime to pay this off and changes in circumstances soon mean our outgoings will literally halve so I should be in a better position to address this.

FireWyrm

NoAngel wrote: »

Thanks, but if I could afford the £600 my original question wouldn't have been 'how long does it have to stay in there for' as I can't afford the full £600 and it is needed to pay direct debits. As I said I'm doing some overtime to pay this off and changes in circumstances soon mean our outgoings will literally halve so I should be in a better position to address this.

As I said, I strongly advise you to make it your priority to pay it off asap. The banks have been told to find some more capital from somewhere (co-op took a drubbing from Moody the other day) - they seem to be re-financing by calling in their debts where possible....overdrafts are a good way to do this quickly. My personal opinion is that what started as a little housekeeping on dormant accounts is gaining momentum. Happy days for the debt collectors and not so much for everyone else.

Also, at the risk of preaching, for the love of little green apples, dont be tempted to borrow the money to pay it off even if the little old man on a skateboard seems to be offering a quick way out. Banks have quietly made it policy to automatically refuse legitimate lending to those who have had such loans in the past.