Direct Debit Advice

Save_It_2

I recently decided to pay off my cahoot loan in one lump sum using the interface on the internet banking section on the cahoot website. The payment came out successfully on the 04/06 and I presumed all was fine.

I checked my bank account today and cahoot have tried to take the money out again and this time they have sent me overdrawn. The direct debit has then been declined by my bank (HSBC) who have then charged me £25 as the direct debit has been declined.

Who do I need to speak to? cahoot or HSBC to reclaim my £25 charge?

Milarky

It looks at first sight as though the mistake is cahoot's. That said, by making manual payment only as recently as 4th June any direct debit will not be able to take account of it (they generally require about 7 days warning.) So the question is: "was cahoot incorrect to take the second amount by direct debit?" Tricky. I very much suspect that cahoot will refund your HSBC charge due the blurring of responsibility (the loan is repaid after all) but it might be worth asking HSBC if the fee can be waived saying it was due to the other bank's error. If HSBC don't budge (which they probably won't) then go back to cahoot expecting an early refund and be prepared to fight for it if necessary. But the good news is that it's not as straightforward as most mistakes which can clearly be traced to customers - that's your ammo.

MarkyMarkD

As Milarky says, if you are due to make a recurring payment by DD and then make a lump-sum payment instead, it varies by lender (for credit cards and other types of loan) whether they will still take the DD payment they've notified you of.

It's not necessarily cahoot's fault, therefore, and not clear that they should/will refund the £25 charge.

HSBC aren't at fault in the remotest and I don't see why they should refund the £25 charge.

Incidentally, if you'd cancelled the DD mandate, HSBC would have rejected the request and not charged you, which would probably have worked rather better for you.

Save_It_2

Just thought I’d update everyone on the outcome. I spoke to Cahoot and they admitted that there computerize DD system does not always update as quickly as it should. Since I paid the load up in full the DD should have been cancelled on their system.

I have to send in a copy of my bank statement showing the £25 charge and they will then send me a cheque.