First Direct can give me a £1000 overdraft but Halifax won't even give me £300?

Jlawson118

I've been banking with First Direct around two years now, and I just recently bought a car this time last month. With me being 20 and this being my first car, the insurance was £2500, and I had £1700 in the bank.

I deposited a £2000 cheque that day and so I called First Direct asking for a short term loan for around a week so that the cheque could clear, in which the lady informed me I would be better off with an overdraft. She asked if I wanted it temporarily or full time, so I asked for full time just in case I need that safety net in the future. So she punched in the information straight away and said "Right, that's activated for you now." I checked my internet banking, it was there and I was able to buy my car insurance.

Anyway, around April/May, I opened a Halifax reward account, and in July I upgraded this to Ultimate Reward, I've paid for two months going, and last week I applied for an overdraft on a few occasions, one for £500, one for £300 and was still rejected.

I don't really use my First Direct account all that much anymore, I just like their savings accounts, so the £1000 overdraft would be in better place on my Halifax, even though their interest rates and charges are a lot higher. I even have an account with Lloyds in which are pretty much the same as Halifax, so I did a little experiment and applied for a £500 overdraft with the same details of the Halifax one, and they accepted me straight away too (even though I didn't want it)

I did ask on here a few weeks ago, and most people said I've probably applied for too many, but I don't think that really is the case. I have a decent credit score, I've got two credit cards that I always pay off instantly, I've just been able to get a £40 a month phone contract with no issues.

What's Halifax's problem?

blue_eyed_girl123

I've had similar with Halifax, despite being a customer for many years, they would only offer £1000 on interest free credit card whereas Barclays offered £4000. Just depends what they're looking for

agrinnall

Sounds like Halifax are being prudent, you have a lot of credit available, possibly too much, and your multiple applications make it look like you are desperate for more. Probably better to cancel the FD overdraft now, wait a few months then apply again to Halifax if you want an O/D with them.

shortcrust

It's just the nature of these things. You might get a card with a 10k credit limit from one lender and on the same day another might not want to touch you with a barge pole. They all have their own criteria and they all want to lend to a different types of borrower. It sounds like you might be falling into the trap of taking credit rejections personally. Don't!!;)

I count up to seven credit searches in the last six months. That's a lot and will put many lenders off. If I were you I'd try to keep things stable for a few months.

Jlawson118

awalton23 wrote: »

I've had similar with Halifax, despite being a customer for many years, they would only offer £1000 on interest free credit card whereas Barclays offered £4000. Just depends what they're looking for

I've just opened a Barclays account online before I even saw your response, I've been thinking about it since last night, and their extra 'pack' offers look to offer more than what my Halifax Ultimate Reward offers me. So if I can get that overdraft I want with them then it's time to say goodbye to Halifax.

EDIT:
Wow I just applied for a Barclaycard who straight up gave me a £3500 credit limit! My Lloyds and Aqua are nowhere near that

Jlawson118

shortcrust wrote: »

It's just the nature of these things. You might get a card with a 10k credit limit from one lender and on the same day another might not want to touch you with a barge pole. They all have their own criteria and they all want to lend to a different types of borrower. It sounds like you might be falling into the trap of taking credit rejections personally. Don't!!;)

I count up to seven credit searches in the last six months. That's a lot and will put many lenders off. If I were you I'd try to keep things stable for a few months.

Hahaha, you're right, I do take it personally! :rotfl: Although I only really started applying for credit back in January/February because I thought I might as well start building it now and in a few years time I may look at getting a mortgage and that it might help. The first few rejections didn't bother me and I didn't take it personally, but when I have one of Lloyd's Bank's biggest credit cards, and then Halifax won't allow me the Clarity card or even an overdraft or anything, that's when I get a bit confused about it and do take it personally, because what they offer, I have better with other banks anyway.

EDIT:
Wow I just applied for a Barclaycard who straight up gave me a £3500 credit limit! My Lloyds and Aqua are nowhere near that

Stuart788

agrinnall wrote: »

Sounds like Halifax are being prudent, you have a lot of credit available, possibly too much, and your multiple applications make it look like you are desperate for more. Probably better to cancel the FD overdraft now, wait a few months then apply again to Halifax if you want an O/D with them.

I thought it was beneficial to appear have lots of credit available but not to actually use it?

colsten

Jlawson118 wrote: »

I deposited a £2000 cheque that day and so I called First Direct asking for a short term loan for around a week so that the cheque could clear, in which the lady informed me I would be better off with an overdraft. She asked if I wanted it temporarily or full time, so I asked for full time just in case I need that safety net in the future. So she punched in the information straight away and said "Right, that's activated for you now." I checked my internet banking, it was there and I was able to buy my car insurance.

Anyway, around April/May, I opened a Halifax reward account, and in July I upgraded this to Ultimate Reward, I've paid for two months going, and last week I applied for an overdraft on a few occasions, one for £500, one for £300 and was still rejected.

I don't really use my First Direct account all that much anymore, I just like their savings accounts, so the £1000 overdraft would be in better place on my Halifax, even though their interest rates and charges are a lot higher. I even have an account with Lloyds in which are pretty much the same as Halifax, so I did a little experiment and applied for a £500 overdraft with the same details of the Halifax one, and they accepted me straight away too (even though I didn't want it)

I did ask on here a few weeks ago, and most people said I've probably applied for too many, but I don't think that really is the case. I have a decent credit score, I've got two credit cards that I always pay off instantly, I've just been able to get a £40 a month phone contract with no issues.

What's Halifax's problem?

I am afraid to say, but you have been had.

You were conned by First Direct - a loan is cheaper than an overdraft. But what's done is done. Your only way out would be to arrange a loan with a lower interest rate, or a 0% balance transfer credit card, but from what you say, you may not get accepted for any of them now as you had too many applications on your credit file now.

In addition, your total available credit is higher than what Halifax think people your age should have in debt. You may or may not agree with Halifax, but it's worth considering their position. As they know loads about money, and about people's ability to repay debts.

Don't give up - the MSE Forum is a great place for making the best out of your money. Just ask for opinions before you make your next move.

PeacefulWaters

1. Overdrafts are expensive, usually.
2. Halifax overdrafts are horribly expensive and to be avoided.
3. One of the reasons hey declined you because your account is less than six months old.

GingerFurball_2

colsten wrote: »

I am afraid to say, but you have been had.

You were conned by First Direct - a loan is cheaper than an overdraft. But what's done is done. Your only way out would be to arrange a loan with a lower interest rate, or a 0% balance transfer credit card, but from what you say, you may not get accepted for any of them now as you had too many applications on your credit file now.

In addition, your total available credit is higher than what Halifax think people your age should have in debt. You may or may not agree with Halifax, but it's worth considering their position. As they know loads about money, and about people's ability to repay debts.

Don't give up - the MSE Forum is a great place for making the best out of your money. Just ask for opinions before you make your next move.

I'd be surprised if a loan pf £2k to be paid back over a year worked out much cheaper than an overdraft. Headline cheap loan rates are typically for people borrowing £7.5k plus.

SuperAllyB

colsten wrote: »

I am afraid to say, but you have been had.

You were conned by First Direct - a loan is cheaper than an overdraft. But what's done is done. Your only way out would be to arrange a loan with a lower interest rate, or a 0% balance transfer credit card, but from what you say, you may not get accepted for any of them now as you had too many applications on your credit file now.

In addition, your total available credit is higher than what Halifax think people your age should have in debt. You may or may not agree with Halifax, but it's worth considering their position. As they know loads about money, and about people's ability to repay debts.

Don't give up - the MSE Forum is a great place for making the best out of your money. Just ask for opinions before you make your next move.

GingerFurball wrote: »

I'd be surprised if a loan pf £2k to be paid back over a year worked out much cheaper than an overdraft. Headline cheap loan rates are typically for people borrowing £7.5k plus.

Especially when loan/overdraft was only needed for a week.