Does dipping into my overdraft once a month hurt?

hermand

We're currently saving a deposit, and as part of that we're trying to clean up our finances (Debt free after 10 years, yay!) and make ourselves as attractive as possible.

At the minute I get paid on around 25th of each month, which is the same day as my rent goes out. The end result is that some months there is a day where I'm in my overdraft. It's normally cleared the same or next day when I get paid, but I'm wondering if I need to fix this somehow or if to not worry about it?

kingstreet

Using a small approved overdraft each month is not going to harm you in any way.

hermand

kingstreet wrote: »

Using a small approved overdraft each month is not going to harm you in any way.

That's all I needed to know - thank you!

Southend1

But... Why are you going overdrawn when you have savings? Isn't this costing you money?

dotdash79

Some accounts come with an interest free overdraft so it might not be costing anything.

hermand

Southend1 wrote: »

But... Why are you going overdrawn when you have savings? Isn't this costing you money?

As above, it's free for all intents and purposes. I get a summary every so often and it's literal pennies.

kiddakidda

One broker I dealt with kept banging on about my partner using her agreed overdraft from her personal acct. She had an agreed O/D of £1900 of which she had used £500 max. When I countered by saying that our joint account had in excess of 8k and my account had in excess of 18k she said that was irrelevant and continued to focus on the O/D.

We chose another broker in the end who placed our case with a suitable lender.

imnothere

I'm well into my overdraft but it wasn't a problem for my mortgage company. I just had to get proof from my bank what the terms are and the standard APR.

Thrugelmir

kiddakidda wrote: »

When I countered by saying that our joint account had in excess of 8k and my account had in excess of 18k she said that was irrelevant and continued to focus on the O/D.

That's because lenders see overdrafts , the savings are invisible. Lenders look top down while borrowers look bottom up. So there's a totally different perspective.