Compulsary bank account with Woolwich mortgage

markhudson01

I was told that I had to take a Barclays openplan bank account out in order to get a Woolwich mortgage. That bank account had a "flexible" overdraft. Every time I got near the overdraft limit, it would increase without asking for my permission. I ended up using that overdraft and ended up £12k overdrawn. I have complained to Barclays & The Ombudsman, but neither want to know, as I have left it too late to complain. I'm outraged! Can anyone help?

Thrugelmir

Try the budgeting board. They'll give you good advice on managing your personal finances better.

ACG

What are you outraged about?

Bonfire_Bride

12k overdraft? Blinking eck!

KRB2725

As my husband says about my credit card - it's a limit not a target! They didn't make you spend the money.

Bonfire_Bride

emmatthews wrote: »

As my husband says about my credit card - it's a limit not a target! They didn't make you spend the money.

That's amazing! :rotfl:

jonesMUFCforever

Having the account may be compulsory but spending their money is not.
As a first time poster I will say no more about it.

amnblog

Have we missed something here Mark? Or is the problem - bank offers lending - client takes up offer - bank extends offer - client borrows more?

Westminster

First world problems!

Outraged?

Do you plan to return everything you purchased with the banks money?

getmore4less

These are(were) standard with Barclays/Woolwich mortgages.

Unless offset the rate on the OD is at the SVR(often higher) not the mortgage rate.

These were documented but some of the implications may not have been obvious to all customers.
There were 2 main implementation issue Barclays made.
1.accumulating all capital payment(normal and overpayment) into the OD so it was possible to effectively run the mortgage on a near interest only basis.
2. there were no adjustments to the payments to take into account the OD and interest accumulated into the mortgage account.

The first if just overpayments would have limited the exposure of customers and been a reasonable feature .

Fixing the latter issue would have been more problematic, accumulating the interest into the account would have made it more obvious to customers the impact of borrowing back the money.
making the payment variable would have probably caused different issues for customers.

Over the last few years Barclays have been sending letters/warnings about these accounts and reducing the OD on the accounts unless people asked to keep them.

BaileyMoselle

The bank was perhaps irresponsible to allow you such a large overdraft. Unfortunately you have spent their money and so they will want it back. My advice is to forget the outrage and focus on your reasons for allowing the overdraft to be spent. Do you comfort spend? Are you living beyond your means? Do you spend to impress, etc. Once you properly determine the reasons for your spending behaviour you will be well on your way to adopting a more pragmatic and sensible approach to money and spending it. I wish you the best of luck sir and hope you are successful in paying off this debt.