Need some advice regarding a loan to pay off overdrafts please...

SmoggyTalisman

my only other option which i don't particularly like is to take out the capital one balance transfer card (limit 1500) then pay off a chunk of the OD with that to take it down to £2000
I would then still have to pay back a set amount to the OD a month via direct debit, say £60 for this discussion.
I would then have to also pay back the CC say £100 a month

that means it would take me 20 months to pay off the CC. and over 30 months to pay off the OD. Of course I would pay off more of the OD as and when I could to try shorten that the best possible way.

All of that is dependent on me being given the 1500 credit on the card though!

I'm honestly stuck, no idea which is best overall. Plus with being declined for the Virgin card I dont want to risk being declined for the capital one card aswell. The suitablity checker on here shows i am 70% likely to be approved

CLAPTON

I am curious

from what bank a/c are you setting up a DD to pay into your bank a/c to pay your bank account's OD off?


unless you have have two separate bank a/cs then it seems a nonsense.

SmoggyTalisman

i have an old account (basic)
i also have a current account (the one with the OD)
my wages are paid into my old basic account
i would be setting up a DD from there to my current account. the current account is not used apart from the fact it has the OD

i also have a savings account but have little in it after i paid for my holiday a few months ago

CLAPTON

SmoggyTalisman wrote: »

i have an old account (basic)
i also have a current account (the one with the OD)
my wages are paid into my old basic account
i would be setting up a DD from there to my current account. the current account is not used apart from the fact it has the OD

i also have a savings account but have little in it after i paid for my holiday a few months ago

This is financially a poor way of managing your money

I am amazed that your Halifax bank allow a 3.5k OD on an account with no income or other activity.


There is absolutely nothing to stop you simply transferring a sum of money from your basic a/c to the Halifax every month either by BACS/PF or standing order without involving Halifax people at all.

YorkshireBoy

CLAPTON wrote: »

I am amazed that your Halifax bank allow a 3.5k OD on an account with no income or other activity.

They'll call it in eventually I'm sure. But for now I'd imagine they're very happy making a circa 31% return on their money.

SmoggyTalisman

Yes, from what I've read, they would call it in and leave me in a hell of a mess. It's either just set up a dd or involve them. My thinking is if I don't involve them, they might just end up pulling the od anyway if they don't know my circumstances to pay it off. Plus, if I try this way I am going to try negotiate something for the OD fees. I I jut set up a DD then they wouldn't have any reason to remove the fees and I'd be paying it off forever with the worry of them removing the OD at any time looming over me

Matt123

You don't want a DD you want a standing order, you could easily set that up for yourself if you have Halifax online banking.

Paul_the_Painter

Tread VERY carefully. Anything involving "negotiating something for the fees" May well be reported to the credit reference agencies as an "arrangement to pay" this is bad for your credit file, and could be causing you issues for years.
With the Halifax current account charging structure, the most efficient way to manage your overdraft is to pay your salary directly into the current account, and have all of your other payments and direct debits coming out as late in the month as you can.
I.e
£3400 overdraft salary £1500
Paid salary on the last day of the month
Direct debits coming out on the 1st of the month (total DD £1300)

At the end of the month, you will have been overdrawn by over £3000 all month and been charged £90

Alternatively
Overdraft £3400 salary £1500
Direct debits all come out on the 20th (total DD £1300)
For 20 days your overdraft is £1900, then the direct debits come out, and you are overdrawn £3200 for 10 days. Total fees are 20 x £1.00 and 10 x £3.00 total £50.
You've just saved £40/month
Nearly £500/year

SmoggyTalisman

Paul_the_Painter wrote: »

Tread VERY carefully. Anything involving "negotiating something for the fees" May well be reported to the credit reference agencies as an "arrangement to pay" this is bad for your credit file, and could be causing you issues for years.
With the Halifax current account charging structure, the most efficient way to manage your overdraft is to pay your salary directly into the current account, and have all of your other payments and direct debits coming out as late in the month as you can.
I.e
£3400 overdraft salary £1500
Paid salary on the last day of the month
Direct debits coming out on the 1st of the month (total DD £1300)

At the end of the month, you will have been overdrawn by over £3000 all month and been charged £90

Alternatively
Overdraft £3400 salary £1500
Direct debits all come out on the 20th (total DD £1300)
For 20 days your overdraft is £1900, then the direct debits come out, and you are overdrawn £3200 for 10 days. Total fees are 20 x £1.00 and 10 x £3.00 total £50.
You've just saved £40/month
Nearly £500/year

hmm, interesting read, thanks!

However, I get paid the 26th of each month, all my DD's come out before the 29th which leaves me the full month to accumulate OD charges

If there is any way I can work it round then that would be perfect but I'm not sure of any way I can do this

thanks for any help

SmoggyTalisman

If I've worked this out correctly then this would be the best way of doing it

Paid the 26th July
All DD's out the 20th August (£500)

That is 24 days @ £2 and 6 @£3 so total of £66

then paid again the 26th August and so on...?


However, my next question is I know I can changed the dates of my DD's going out fairly easy, but say for my car insurance which goes out the 28th currently. Say I paid it this month then asked it to be the 20th next month would that mean it goes out the 20th of August or the 20th of September? because the 20th of August is only 22 days worth not a full month?

Anyone had any experience with this in the past?