Rip off graduate accounts

jenleigh

I was so annoyed yesterday when i got home and found a letter waiting for me stating that my HSBC student account was transferring to a graduate account and the interest free overdraft that I'd been expecting to continue for 3 years was actually stopping and any overdraft would be charged at 9.9%. I phoned telephone banking and was told i would have interest free for 3 years but not daring to believe it i went to my branch and my fears were confirmed. I explained i had a job offer but couldn't start as a nurse until October (due to registration reasons) but to no avail, i requested the number of the complaints department, the advisor was utterly useless, and i left feeling that no other bank would take me at this late stage. After reading through Martins advice I'm going shopping for a graduate bank account tomorrow. Just wanted to share my disgust.x

jonesMUFCforever

They don't have to offer you free banking on a graduate account just as you don't have to continue banking with them.

Vote with your feet - there are plenty of banks out there who will offer you a free o/d and preferential rates on personal loans.

emma396

i'm surprised with this as well. my bf has graduated this year, and he's told me they're charging him interest on his overdraft (hsbc as well) seeing as he's about 1500 overdrawn they're gonna rip his to shreds with interest! definitely need to find another account. i graduated 2 years ago, still have £1000 interest free overdraft with abbey

edit: anyone know where to get the best graduate account? ideally looking for someone who will offer a large amount interest free overdraft?

Lavendyr

HSBC have done this to everyone, it is very very poor. I was lucky enough to have been transferred to a graduate account last year before they'd thought of this money-spinner, so I still have my interest-free overdraft until next year without paying fees, but it's still been decreased further than was communicated in the original terms I was sent when the account was converted.

If you were earning, I would recommend Alliance & Leicester Premier Direct current account - but it requires £500 minimum monthly funding. Can you get a summer job to help out before the nursing role starts in October?

Edit: Actually, if you have an overdraft too big to afford to pay off (or where the monthly interest would be greater than £10), aren't you just easiest off paying for their Graduate Plus account - that costs you £10 a month, and you keep the interest-free overdraft plus a few other benefits?

b33r

emma396 wrote: »

edit: anyone know where to get the best graduate account? ideally looking for someone who will offer a large amount interest free overdraft?

Martin's article sums them up pretty well: http://www.moneysavingexpert.com/banking/graduate-bank-accounts

Basically Royal bank of Scotland and Lloyds are the best for graduates*. Halifax has the highest (2750) but it is only for 1 year after your degree whereas RBOS and Lloyds and 2000 for 1st year after, 1500 for second year after and 1000 for 3rd year after.

I'm currently with Halifax so aren't threatened by this HSBC thing however even I am considering swapping to RBOS or Lloyds. I've read the terms and conditions on them though and you seem to be able to apply up to 2 years after you have finished so possibly the very best thing is switch to Halifax for first year and then move to one of the others. More hassle however and there is a chance in the next year that RBOS and Lloyds will change their graduate account. This has been hinted at by HSBC who are claiming they are just the first bank to do this and others will follow suit.

hth
paul

*at the moment

Jarvissa

I really recommend the NatWest Graduate Account.

2K Interest free OD for the first year after graduation, 1K interest free for the 2nd year and (I think) £500 interest free in the third year (I'm coming up to my third year so I'll find out soon enough)

Top Bank, in my opinion.

Ooh forgot to say, I never had my student account with Natwest, I went to them as a fresh graduate. I WAS with HSBC for my student account.

Sularia

I know exactly what you mean, Jenleigh. I got the same letter from HSBC a couple of weeks ago, and they changed the account on the day I received the letter! I rang up telephone banking and they told me I needed to go into a branch. Luckily I am studying for another year at least so have got them to change it back to a student account, but now want to pay off my overdraft entirely whilst at Uni so that I can change banks with a clean slate, so that if the other banks adopt the same attitude as HSBC regarding grad overdrafts, I won't be hit with loads of charges. Whatever happens, I won't stay with HSBC.

jenleigh

I went to Lloyds TSB to open a graduate account but because technically i'm still a full time student until Oct 2007 I could only open a student account which offers only £500 interest free overdraft initially (perhaps because i've only a little while left) but i can negotiate when i'm settled in. fingers crossed their graduate deals won't change over the next couple of months.
The big difference was that the staff were very helpful and in my book £500 interest free is far better than £1000 with 9.9% interest that you feel you've been tricked into, it'll also require me to be more careful so that i can clear it quicker when i get my first proper wage! Thnik with my feet i did and whilst i only felt stuck for a few hours,it won't happen again.x
:j

jenleigh

Lavendyr wrote: »

HSBC have done this to everyone, it is very very poor. I was lucky enough to have been transferred to a graduate account last year before they'd thought of this money-spinner, so I still have my interest-free overdraft until next year without paying fees.
if you have an overdraft too big to afford to pay off (or where the monthly interest would be greater than £10), aren't you just easiest off paying for their Graduate Plus account - that costs you £10 a month, and you keep the interest-free overdraft plus a few other benefits?

Hi Lavendry. I too had the graduate account with the old terms for a little while, but then went on to do a postgrad and went back to the student account, therfore more frustrating! I don't have an overdraft yet, but will need the facility when my bursary stops next month and i have two months without income, its mostly the principle and the poor practice that has annoyed me and for that reason i would not want to pay for the graduate plus (the option a HSBC telephone banking advisor suggested too). Thanks for your reply, its useful to hear i'm not alone.x