Packaged Bank Account 10years+

Milo19

Hi
A friend of mine recently told me that he is claiming the fees for packaged bank accounts back from his bank - which got me thinking.

I had a Silver account from Lloyds predating January 2007 costing £7pcm. That account was then upgraded to a Gold account in June 2009 costing £12pcm. That fee went up to £12.95 in Dec 20011

My Question is, I have never claimed on any of the "Packages" included with the account and when it was upgraded I was advised by the helpful branch members that mortage companies would look more kindly to my application should I have a "higher account". At that time I was buying a house so I took the leep and upgraded online.

Now, I lost my job in 2014 and have struggled since then massively - I was told by the same branch people that I cannot downgrade my account as i would have to pay back my overdraft - currently £1750.

However, things got bad again at the turn of the year and low and behold, Lloyds advised to downgrade in order to save the £12.95pcm. When i challenged them, they infomed me that various factors affected the charge and how it looks on my credit file and it may have been because when I originally asked to downgrade, I wouldnt have passed the credit check to keep the overdraft in place.

Does this all sound like a load of rubbish????

Would I be able to challenge Lloyds and ask for some money back?

Anthorn

A difficult one. Overall you cannot usually downgrade an account, to do that you need to close the account and then open a new account. But you cannot usually close an account which has an outstanding overdraft.

However you might have a claim for unfair fees due to being wrongly advised to the extent that the account was mis-sold.

jonesMUFCforever

These packaged accounts often come with a sweetner such as a cheaper overdraft interest rate - so they might have been correct in advising you not to downgrade when they did.
It will depend on if the fee charged plus the interest charged was less than an ordinary rate overdaft.
Ask them to check the sums for you - you have nothing to lose.

Mr_Goodkat

Anthorn wrote: »

A difficult one. Overall you cannot usually downgrade an account, to do that you need to close the account and then open a new account. But you cannot usually close an account which has an outstanding overdraft.

However you might have a claim for unfair fees due to being wrongly advised to the extent that the account was mis-sold.

That is simply not the case. Where is your evidence to support that accounts cannot usually be downgraded and that the account needs to be closed with a new one opened?

Mr_Goodkat

Milo19 wrote: »

Hi
A friend of mine recently told me that he is claiming the fees for packaged bank accounts back from his bank - which got me thinking.

I had a Silver account from Lloyds predating January 2007 costing £7pcm. That account was then upgraded to a Gold account in June 2009 costing £12pcm. That fee went up to £12.95 in Dec 20011

My Question is, I have never claimed on any of the "Packages" included with the account and when it was upgraded I was advised by the helpful branch members that mortage companies would look more kindly to my application should I have a "higher account". At that time I was buying a house so I took the leep and upgraded online.

Now, I lost my job in 2014 and have struggled since then massively - I was told by the same branch people that I cannot downgrade my account as i would have to pay back my overdraft - currently £1750.

However, things got bad again at the turn of the year and low and behold, Lloyds advised to downgrade in order to save the £12.95pcm. When i challenged them, they infomed me that various factors affected the charge and how it looks on my credit file and it may have been because when I originally asked to downgrade, I wouldnt have passed the credit check to keep the overdraft in place.

Does this all sound like a load of rubbish????

Would I be able to challenge Lloyds and ask for some money back?

How did you come to have the Silver account in 2007 costing £7 per month in 2007?

If you selected the above account yourself then the complaint will need to be about the miss-selling of the upgrade to gold as the mortgage companies looking kindly on a 'higher account' was a lie however there is only your word for that and you did upgrade the account yourself online rather than directly with branch staff so I think Lloyds will push back and say you selected the account upgrade yourself rather than any miss selling.

Not having used / claimed on the insurances is not evidence that you were miss sold - you had these protections in place meaning you weren't paying for them elsewhere and would have had the protection should you have needed to claim.

You need to validate / complain about the refusal to downgrade the account and ask to see the terms and conditions relating to the overdraft at time of the downgrade other than the fact that all overdrafts are repayable on demand I would be surprised if the downgrade requires repayment of the overdraft as their standard current account offers an overdraft facility.You could also do with understanding any preferential overdraft terms or charges that you got compared to their standard account - if a significantly lower rate are large interest free proportion they may be able to show that you were paying less overall through having this account and rather than refusing to downgrade they advised you at the time of the financial benefit of retaining the packaged account.

It is certainly worth a complaint and you may get some or all of the money back the challenges I see are that you already had a packaged account, you did the upgrade online and everything else is your word rather than proof / evidence.

Good luck

alternate

Mr_Goodkat wrote: »

That is simply not the case. Where is your evidence to support that accounts cannot usually be downgraded and that the account needs to be closed with a new one opened?

I have not heard of that either. Sounds almost like that in itself would be classed as misselling. Continue to pay for these optional services or we will close your account.