New overdraft charges

Charlie747

We bank with nationwide and have an account each with a constantly maxed out 5k overdraft each. We currently pay £15 a month per account in overdraft charges but from November this rises to £144 per month per account.

They cant help us at all. The only "help" they can give us is a payment plan which will affect our credit files. Which in turn means when we come to remortgage in a couple of years we will not get another mortgage unless we pay silly rates.

We have applied for a joint loan with nationwide but they have declined us on affordability. The payments are 198 a month as opposed to 288 a month on the overdraft charges and with the loan, our debt will be gone whereas with the charges this is endless.

What the hell? How is this allowed? How is this responsible lending? I'm so angry.

[Deleted User]

If you can't manage to make the payments, then you'll need to take them up on their offer of a payment plan.

You won't be able to get any significant credit from a mainstream lender while you're so heavily in debt.

Visit the DFW boards for advice on cutting costs and paying back faster.

Ben8282

You don't say how this situation of 2 bank accounts both constantly maxed out at £5,000 overdraft each came about or how long it has been going on for,
If to date this has only been costing you £15 each per-month in overdraft charges, with such a bargain I can sort of understand your reluctance to repay the overdrafts until now as you have been getting an approximate APR of 3.9%.
You have however probably not been doing yourself any favours. Having a current account constantly overdrawn by £5,000 will not look good on your credit files.
The best solution I can think of would be to try to obtain a 0% money transfer card to repay as much as possible of the overdraft and then actually start to make payments to reduce the debt. Good luck.
If you are unsuccessful there is not much you can do other than to accept the new charges and concentrate on trying to bring the balance down as quickly as possible.
As you say that the accounts are constantly overdrawn by this mount, this would imply that no money is ever paid into the accounts or if it is it is transferred out almost immediately. Under these circumstances I am actually surprised that Nationwide have allowed this cheap authorised overdraft facility for such a large amount to continue and have not discussed it with you sooner..

Charlie747

Thanks for the detailed replies. It was to fund moving house with a view to be paid off over approximately two years. This was planned and at the time was the cheapest borrowing option. The annoying thing is my salary will be nearly 20k more in about a year due to career progression.

Thrugelmir

Charlie747 wrote: »

What the hell? How is this allowed? How is this responsible lending? I'm so angry.

Why haven't you reduced the borrowing though. Time to take matters into your own hands than blame others. You've had a good run so far.

Kentish_Dave

The only person to be angry at is yourself. Overdrafts are repayable on demand and are there for very short term cash flow issues, not for term borrowing.

It was a terrible decision, completely reckless, and unsurprisingly has now bitten you on the bum.

The way out is to cut your spending back, find a way to increase your income, and get it paid off,

If you post a statement of affairs people here will be able to assist with both.

If you take the right lesson from this then the charges to date will be money well spent.