Overdraft withdrawn - now no money

Blueskies2014

I am very upset and stressed. I was told by Step Change to advise all of my creditors I am in financial difficulty. I didn't realise that by advising my bank that they would immediately withdraw my overdraft facility, which has happened.

I realised I had my facility withdrawn when I needed to withdraw some cash for a bus fare and could not withdraw any money. Then when I got home the letter from Sandanter was waiting.

It's left me with no money whatsoever and my Jobseekers Allowance payment which I was depending on has now been swallowed up by my overdraft and my balance is now £2335-. My overdraft allowance is now zero, they have stopped me using my card, my cheque book and cancelled my direct debit to my phone company and my standing orders to pay my rent arrears and other creditors.

I do have another unused bank account, which I will use now, but I can't get back my JSA payment and I have no money at all to live on for the time being. I think Step Change should be much clearer about what will happen when you advise your bank you are in financial difficulty.

My debt problem escalated after I was made redundant 2 years agao and I was already in debt. I have just done on and off temp work ever since, which has never been enough to pay the debt I owe. I had to move from my flat last year due to not being able to pay the rent. I have £18K of debt altogether over credit cards and 2 overdrafts.

JustAboutThere

We're you not advised to open a new, basic bank account somewhere away from where your debts were?

Petlamb

Don't ask me to name exactly what rule it is (right of appropriation maybe?) but when a benefits payment comes into an account, you can go to the counter and ask for it to be handed over in cash even if you're over your agreed limit. The ex was told that by an HSBC employee when he was in that situation.

My personal experience is it's best to open another account (Mine's with the coop, as they offer accounts to pretty much anyone) with an institution you have no debts with. Means they have no way to use the 'offsetting rule' against you.

happy_bunny_2

Complain to the bank, in person, that removing your OD has left you no money for food and priority debts such as electric.

They are supposed to give you 30 days notice, but there was a get out clause in mine about 'unless we feel you can't meet your commitments'

Still, I can't see it would be considered fair by the FOS that they have denied you access to funds to pay priority debts. That route will take ages though, so maybe the branch is the best option.

Good luck

HB

eyeopener2

First step is to always open a new account, especially as your on JSA. Stepchange advise this as a prerequisite usually. Or they did with me anyway.

Do as Happy Bunny says and you may want to look at bankruptcy if you have no way of paying any of it back.