Bank wanting to set up their own DMP for me?

mrsnonsmoker

We are just about managing, everything is paid on time, usually minimum payments but nonetheless, we are ok. Suddenly Smile bank want to withdraw our reducing overdraft - we have been paying it off £60 a month and currently owe £1,400. We both work, pay about £4k a month into the account.

I got a message saying get in touch about overdraft, thought it was just a formality and then they said they wanted to contact all our creditors and renegotiate all our repayments so that they would get more. The guy said they would freeze our current account and just leave us enough to pay bills? This sounds like some sort of madness - I said if I wanted a DMP I would go through someone like Step Change or another charity, I thought you should never do something like this through one of your creditors?! But the point is, we are managing, we don't need a DMP.

Finally I offered to double our repayments and they refused - they want it all back on Monday or they'll give us 2 weeks to find a new bank. We've been customers for 16 years. We have no "bad" debt anywhere, we are making repayments on 3 loans, one credit card and 3 store cards.

Is this a sign of the times or do they just not like us?!

sourcrates

Get a new bank account pronto, then treat the old overdraught as just another debt and repay it at a rate YOU can afford, not what the bank tells you to pay.

Don't let them anywhere near your other financial agreements either, they are trying to force your hand, favouring one creditor above another is frowned upon, tell them to get stuffed !!!!

HappyMJ

They probably don't like the way you are handling credit. An overdraft is repayable on demand.

If you want to continue banking with them you'll need to borrow the money and pay off the overdraft....or you can find another bank.

mrsnonsmoker

Thanks - why are they doing this?! Yes we are going to get a new bank account next week, really angry as we had a good deal with them we were happy. But we'd have to pay it all off at once which I can't do, or get the overdraft transferred - they said if it wasn't paid off in full and if I wouldn't agree to the bizarre "plan" they would pass it to their Collections Department as something we had defaulted on.

I rang StepChange to ask for some clues and all they said was we will do a budget with you and refused to discuss anything (which I also thought was odd)

mrsnonsmoker

Cross posted - yes it sounds like they don't like us much any more! I wouldn't carry on banking with them now, I hate corporate bullies.

HappyMJ

mrsnonsmoker wrote: »

Thanks - why are they doing this?! Yes we are going to get a new bank account next week, really angry as we had a good deal with them we were happy. But we'd have to pay it all off at once which I can't do, or get the overdraft transferred - they said if it wasn't paid off in full and if I wouldn't agree to the bizarre "plan" they would pass it to their Collections Department as something we had defaulted on.

I rang StepChange to ask for some clues and all they said was we will do a budget with you and refused to discuss anything (which I also thought was odd)

Not repaying an overdraft on demand can lead to a default so if you want to avoid a default you'll have to pay it back.

crazy_cat_lady

Unfortunately banks don't care about their customers, or how long you've been banking with them etc. They care about how they can make money and who is a risk to them. This happened to me when I was a student and Ll0yds merged with T S B. I can only echo the advice of others about getting a new bank account asap.
Good luck

andyfromotley

Thats dreadful, as said DO NOT let them set up some dodgy DMP. YUK YUK YUK!!!

Without knowing your finances could you not squeeze a bit more out of £4k per month and get it down over say 4-6 months?

Playing_with_Fire_2

If you haven't done it then try checking your other accounts and credit file. I had an issue a while ago when all my credit card limits got reduced - there was an error on one of my accounts and it had been reported on my credit file and all the other lenders started to panic.

National_Debtline

Hi mrsnonsmoker


This seems at face value like quite a harsh and abrupt decision by your bank - that said, it is one they are entitled to make. You should definitely open an alternative account elsewhere as soon as possible, so that at least you can then "jump" rather than be "pushed". It may be best to seek a "basic" account for now so that the process is not held up by extra credit checks.


I would agree with the poster above that checking your credit report ASAP is wise, as the bank may have been alarmed by something they observed on there (which may be inaccurate and in need of amendment).


Dennis
@natdebtline

mrsnonsmoker

Thank you to everyone for replying, I know that in theory overdrafts are repayable on demand but in practice I thought it was rare. In any case we are going to repay it in full on Monday as they demanded - I bet that's not the end of it though ...!