Using Arranged Overdraft for 5 Days

xlnc99

Can someone tell me how this would effect me if i need to use £500 of a 1k overdraft i have for 5 days and then pay it back in full.

How negatively would this effect my credit file and would this be marked down on my file? How would they know

Thanks

Willing2Learn

Hi,

The associated credit account on your credit files will show a negative balance. Lenders will be able to see this when they view your credit file. An overdraft can indicate to lenders that you are living beyond your means. I think just one months isolated instance of using the overdraft facility would not impact too negatively, if the remaining six years of credit history on that account is clean

xlnc99

But if i clear it within a few days will it still show up as negative balance? It should be back to 0 - is that not right? So i believe when the bank reports to the CRA agency at the time of the balance that is what will show. So it all depends when it is reported? Am i right?

Willing2Learn

Yes, it will depend on when the bank updates the CRAs

xlnc99

I have no idea, its a new bank account only opened 5 days. Do they have to wait a month or could they report it ASAP? I could tell on my old accounts because they date is the same every month but i dont know how new bank accounts work

any idea?

Thrugelmir

Occassional use of overdraft facility isn't going to have a major bearing on your credit profile in isolation.

Willing2Learn

xlnc99 wrote: »

I have no idea, its a new bank account only opened 5 days. Do they have to wait a month or could they report it ASAP? I could tell on my old accounts because they date is the same every month but i dont know how new bank accounts work

any idea?

Usually, when I open a new current account, the status is recorded as 'unknown' for the first month. But to be honest, I don't know. Sorry...

xlnc99

no problem. Thanks. Anyone else who has any idea about this - advice much appreciated

xlnc99

Thrugelmir wrote: »

Occassional use of overdraft facility isn't going to have a major bearing on your credit profile in isolation.

thanks- i am more concerned about the bank reporting it on the CRA. I plan to pay it off within 5 days and bring it back to zero. I just dont want the CRA to report it credit file

stehouk

I used £250 from my Halifax arranged overdraft facility at the end of October and repaid in full 3 days later, iv'e checked my report and it just shows as up to date, the same as every other month so it seems in my case it hasn't been recorded as being used.

Thrugelmir

xlnc99 wrote: »

thanks- i am more concerned about the bank reporting it on the CRA. I plan to pay it off within 5 days and bring it back to zero. I just dont want the CRA to report it credit file

Lenders will be analysing for trends and usage over an extended period of time. Not ad-hoc reported balances.