Advice Needed-Over Credit Limit

miss_clarabelle

Hi Everyone,

I need some advice about my credit card and I've been looking all over the place and can't find an answer. I've got myself into a bit of a pickle and I'm not sure what happens now.

Basically, I pay off my credit card in full every month. The reason I got it was to save points. Anyway, last month I went over my credit limit by £50-£100 without realising. As soon as I realised I paid off a big chunk straight away, so that I could carry on spending for the rest of the month. I thought I would get a charge for going over my credit limit. When the bill arrived at the end of the month there didn't appear to be any charge. To confirm, when the bill arrived the amount on it was under the credit limit because I had paid off a big bit before they sent the bill. This was the middle of the month and had long cleared before the bill arrived. If they didn't put a charge on my bill will I get charged at a later date? Or will I not be charged because I paid the amount I had gone over the credit limit off before they billed me?

This leads me to my second mess up...this month I did the same, but worse. I received the statement and didn't pay it straight away (on one occasion I tried and the site was down). I didn't go past the date the payment was due, but because I didn't pay it straight away I thought I had credit left to play with and I didn't. Basically, over the course of a week I made 16 payments using my credit card that were over the credit limit. I've been buying baby stuff! I have paid off a large amount (to cover the full bill amount and take me well under the credit limit) and I'm currently waiting for it to clear. To confirm it will go through before the date that the bill payment is due, but I'm £250 over my card limit thanks to 16 separate transactions. Will I be charged for these? Will I be charged 16 fines, one for each one what was a spend over the limit? Or will I get away with it because when they send me the bill at the end of this month the amount it will show as the total won't be over the credit limit? Like it wasn't over it last month by the time they printed the bill.

Any sound advice or personal experience is much appreciated. I'm in total panic because my baby is due any day and I'm now terrified I'm going to get hundreds of pounds of fines. The company is MBNA, if that helps.

Thanks for any advice xxx

guesswho2000

Can't say for sure as I've never gone over limit, but I think you only get the one charge for being over limit, they're not like current accounts where you get paid and unpaid item fees, you only get charged for missed/late payments or exceeding credit limit, £12 charge.

RuthnJasper

Bad luck; sorry to hear about what happened. This has happened to me in the past. All I can suggest is that you take a deep breath and 'phone MBNA. They may be able to sort out a repayment plan for you or some way of dealing with the situation.

When I had an M&S Credit Card (while ago now!) I rang them as I was in a similar situation and we agreed a 'payment plan', whereby I paid a certain agreed amount and they waived the 'over-the-limit' charges for a period of three months. That way, it was back below the limit - lesson learned, and it didn't happen again. But it's ALWAYS (or so I've found, anyway) best to approach them and be honest and genuinely willing to resolve the problem with them, rather than trying to work out a way to get around it without their involvement.

As I'm now in the final few months of an IVA, I can honestly say that if I'd followed my own advice here back then, I wouldn't have got myself into such a financial pickle.

I don't think they'll be charging you hundreds of pounds of fines - probably one over-the-limit charge plus the extra interest - but for your own sake of mind give them a call first thing in the morning. Try not to panic - this is something that can be sorted out - it'll be OK if you 'fess up and get it sorted.

Very best wishes with your imminent baby. Good luck to you. x

YorkshireBoy

miss_clarabelle wrote: »

I'm in total panic...

Stop fretting! From your MBNA T&Cs*...

MBNA wrote:

£12.00 if you are over your credit limit on your statement date

For clarity, that's one £12 charge *if* you're over your limit on the actual statement date.


* Condition 5.1, 3rd bullet

miss_clarabelle

Thank you very much for your replies. Yorkshire Boy your comments are the most appealing of the three lol. I love the idea that because I rectified my mistake before the statement date then it won't have any negative repercussions. Is this really the case though? It seems too easy. Don't credit card companies take any opportunity to fine you? Although your answer would explain why I didn't receive a fine on my last statement when it arrived. As by the date it was issued I was no longer over the credit limit.

In theory I could spend £5000 on a credit card with a £1500 limit, as long as I paid it back within a few days and it cleared before my statement was issued? And I wouldn't even get one fine?

If I got one £12 I wouldn't be too fussed. Even if I got a £12 for each of the two months I messed up then I could live with that. It's the thought of 16x £12 fines that is scary.

The idea of phoning them to discuss it is good in some ways. If there is a problem I know I'm best off facing it ASAP, but at the same time I don't want to highlight my mistake for them if there is a way I'm going to get away without any fines. Does that make sense?

Also, when would fines be applied to my account? Would it be with the next statement? If so, then I guess I got away with it last month, as I've had the statement that covers the first time I was over the credit limit then repaid before the statement.

Thanks again everyone xxx

jonesMUFCforever

Wait for the statement to be produced and take it from there....

pvt

miss_clarabelle wrote: »

Don't credit card companies take any opportunity to fine you?

They're not fines, they're charges. Companies cannot "fine" you, only the police and the courts can fine or penalize you.

miss_clarabelle wrote: »

In theory I could spend £5000 on a credit card with a £1500 limit, as long as I paid it back within a few days and it cleared before my statement was issued?

No. If you tried to spend £5k with a £1,500 credit limit your card would be declined when the vendor tried to get it authorized by the issuer. I'm guessing you went over your limit making a number of small transactions that were probably below the threshold for which the vendor needs authorization from the issuer.

miss_clarabelle

I know that's the best option jonesMUFCforever, but I'm a worrier and it's the best part of 3 weeks before the next statement will be produced and I will be having the baby within the next 2 weeks. I don't want it hanging over me because I know I will stress about it. Also, once the baby is here (our first) I'm gonna be so tired and confused. I'm not going to know my !!!! from my elbow!

miss_clarabelle

"Fines", "charges" you know what I meant pvt. Obviously I'm clueless in this area and easily confused. When I said about spending £5000 with a credit card limit of £1500 I didn't mention it being one single transaction. In my mind I will thinking of a crazy shopping spree. £50 here, £50 there. So in theory I could spend £5000 in small transactions over a day or two, because none of these would need authorization? Then repay it and wait for my payment to clear before the bill arrives and receive no "charge" at all.

To clarify, I will NOT be doing this. I won't be intentionally ever going over the credit limit. I'm just using an example.

YorkshireBoy

miss_clarabelle wrote: »

I don't want it hanging over me

What's to hang over you?

I've told you what will happen...nothing*, so long as you're under your limit on statement date. If you want a second opinion dig out your T&Cs, or read them online on their website as I did.


* Internally, you've probably damaged your 'reputation' with MBNA...but they aren't going to charge you. The worst that could happen is a) they put you on the 'rate hike' list (but that won't matter since you always pay in full), and b) they tell the CRAs you were over limit (but I don't think they will based on the condition I quoted earlier as it seems they're only interested in the state of the account at statement date).

What's happened here is either that which 'pvt' has said above, or MBNA have let you use your 'shadow limit'.

I'll tell you what...if MBNA bill you 16 x £12 in charges I'll pay it for you. Now you can't say fairer than that!

miss_clarabelle

Thank you YorkshireBoy. You've put my mind at ease. When I said about it "hanging over me" I was referring to the worry. I'm a worrier lol. I spent ages and ages looking for the t&c's. They weren't easy to find for me! It says in the Summary Box at the start:

"Default charges-If your payment is late, if you exceed your credit limit, if your payment fails-£12"

It doesn't specifically say on your statement date, but then later in the document it does say specifically "£12.00 if you are over your credit limit on your statement date", so I think I had previously only read through the Summary Box statements for clarification. The numbered t&c's are the ones I have agreed to, aren't they? And they say "on the statement date" so I think I'm happy with that.