Over Draft Cycle

94 Posts


Hi guys
I hope you can help.
Firstly my credit profile isn’t great, secondly there’s no one who can lend me the money.
I’m stuck in a constant cycle of overdraft debt circa £2k. Pay goes in and I have to use it to live. Now with the changes in the fees it’s going to be even harder for me.
I’ve tried to get a credit card to cover it but no joy and I can’t get a loan from anywhere.
Do you think there is any point in me asking my bank to transfer it to a loan? And if so what’s the best way? Letter or branch etc?
I hope you can help.
Firstly my credit profile isn’t great, secondly there’s no one who can lend me the money.
I’m stuck in a constant cycle of overdraft debt circa £2k. Pay goes in and I have to use it to live. Now with the changes in the fees it’s going to be even harder for me.
I’ve tried to get a credit card to cover it but no joy and I can’t get a loan from anywhere.
Do you think there is any point in me asking my bank to transfer it to a loan? And if so what’s the best way? Letter or branch etc?
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Replies
You need to hit this from a different angle.
You need to cut outgoing/increase income. Sorry it sounds blunt but its the reality.
I was where you are a few years ago due to health issues limiting my ability to work overtime and being a bit over committed financially
plenty folks here will advise.
Check out the threads on posting you income/outgoings.
For me I sold a few things,cut back like mad and lived like a monk.
Luckily for me my health improved allowing me to earn a bit more.
A lesson learned and apart from mortgage my debt is negligible with no CC/loans or the like with some savings.
I was actually looking at these changes. My current account would charge me circa £90 a month on a £2K OD right now :eek:
Hey ho I’ll get there
Open yourself a new basic bank account with no overdraft facility, obviously with a bank with whom you have no debt, transfer all your income/expenditure to your new account, and use that instead, it will learn you to live within your means for one thing.
Your old account can then be treated as just another unsecured, non priority debt to service, write to your old bank asking them to freeze interest on the account, explain why you cannot pay it, if you come to an arrangement with them, you can then pay it off bit by bit, if you can`t, long term it will be closed and sold on, so then rinse and repeat.
Obviously this would get you out of the constant debt spiral, but do nothing for your credit worthiness, you would need to decide your priorities.
More than a third of IVA`s fail....fact.
Could A Debt Relief Order help you ?
Never pay a fee for a Debt Management Plan.
For free non-judgemental debt advice, contact either : Stepchange, National Debtline, or CitizensAdviceBureaux.
https://www.lemonfool.co.uk/financecalculators/soa.php
I love my job
Lewis Carroll
I was with HSBC for years and switched banks about 8 months ago to Nationwide Flex direct. It offered me a 2k overdraft no interest for 1 year. The over draft will be gone by the 11 month, this year. This has given me breathing room. But I have been paying it down, which means having a tighter year.
I also took out a second account with no overdraft with RBS so this has helped pay for my bills, mortgage etc. I have a written down a list of all of my direct debit bills, that come out of this account. So its always in credit.
I pay into Nationwide my full salary, leave £200 ish to go towards my overdraft then the rest goes to RBS on a direct debit.
Once the overdraft is cleared, close the Nationwide account. Then debt freedom in a year!
I am now obsessed with checking each account every day! Before I rarely looked at my bank balance! I never want to be in an overdraft again.
My way may help you. Good luck. Bizzy:j
A £2k overdraft is not huge and the new charges don't come in until April. Cut back as far as possible to reduce the overdraft over the next 2 months.
Save £12k in 2023 Challenge #8 £12,000/£5100
The 365 day 1p Challenge 2023 #1 £670.00/£72.00
The 365 £1 a day Challenge for Christmas 2023 #43 £1000/£300
Does that not work out to be a little bit more expensive?
Surely an amount that reduces that to a minimum for part of each month is better overall than a few £ or so here and there against the full £1500?
I'm about £1300 into mine at present and that is costing £2.02 a day at present, increasing as I spend.
Trying to reduce it by £100 minimum a month.
Had it way too long and when it's costing me £60-£100/month (not sure about April when the charges change, but I bet I'm in the 10% that ends up paying double for it!). Used to pay £20-£30/month, but after the last set of changes, that practically doubled, and it's money that could be effectively used elsewhere.
The thing that bothers me is that for every £100 I reduce it by, I save something like £2/month.
At least it will be nice to see a positive balance for the first time in ages once it's paid off.