Overdraft

Brinny1982

I wonder if anyone can advise, I currently bank with Nationwide, I have an overdraft of £850 I get paid monthly which is more than the overdraft amount, my Internet banking does not allow or give me the option to reduce my overdraft, so I went to the branch they don't have the option either and advised me to ring Nationwide. I Called them only to be told they can't reduce it and the only way to do this would be through recovery and impact my credit file, or pay the full £850 off, I even wrote a complaint to nationwide and they can't assist, seems absolutely unfair that I can't reduce this per month when I want to, I understand the option to increase may not be available but come on people are trying to get out if debit and they don't give you the option to pay it back, has anyone experienced this. Many Thanks 

-taff

I don't understand. If you are asking for them to be your money manager by reducing the amount you can borrow then why are you just not being stricter with your budget and doing t yourself every month? When it's paid off, get rid of it.

Ace_DK

Maybe I'm the one being silly here, but why can't you arrange your budgeting/spending so you're in your overdraft less and less each month? I paid off my student overdraft earlier in the year doing that. 

k12479

Brinny1982 said:

I have an overdraft of £850 I get paid monthly which is more than the overdraft amount...they don't give you the option to pay it back

When you get paid, surely that will pay off the £850 overdraft?

brettcta

Maybe look at moving banks? Halifax allow you to reduce your overdraft in apps if you can get a switch to a bank with a slightly lower overdraft facility and do it that way?

Nearlyold

Sorry I'm confused, are you wanting a lower overdraft facility or are you wanting to pay off the overdraft. Which is it you are saying Nationwide wont let you do? Surely you can "pay it back" by paying money into the account anytime you want?

Obviously you can't reduce your overdraft limit when you are already at the limit as that would immediately put you over the limit and subject to punitive interest charges.

Brinny1982

Nearlyold said:

Sorry I'm confused, are you wanting a lower overdraft facility or are you wanting to pay off the overdraft. Which is it you are saying Nationwide wont let you do? Surely you can "pay it back" by paying money into the account anytime you want?

Obviously you can't reduce your overdraft limit when you are already at the limit as that would immediately put you over the limit and subject to punitive interest charges.

So I don't have the option on my online banking when I get paid which is more than my overdraft to reduce it as in £100 or so per month, the guy in the branch couldn't understand it either, same as if you have a credit card your given the option to make a payment. With Lloyd's you can lower your overdraft amount at anytime online providing your in credit with them and not at your overdraft limit. You should be able to pay back something you owe at anytime just seems odd there isn't an option for this

[Deleted User]

Brinny1982 said:

You should be able to pay back something you owe at anytime just seems odd there isn't an option for this

But you can pay it back any time you want.  You just have to pay money into your account.

k12479

Brinny1982 said:
So I don't have the option on my online banking when I get paid which is more than my overdraft to reduce it as in £100 or so per month, the guy in the branch couldn't understand it either, same as if you have a credit card your given the option to make a payment. With Lloyd's you can lower your overdraft amount at anytime online providing your in credit with them and not at your overdraft limit. You should be able to pay back something you owe at anytime just seems odd there isn't an option for this

I think you're trying to use an overdraft the wrong way. An overdraft is your account going negative. Any money that goes into your account will start to repay it.

If you pay in £100 your overdraft will reduce to £750 (the amount, not the limit). If you pay in £850 your overdraft will be repaid and your balance will be £0. If you pay in more than £850 your overdraft will be repaid and the left over will put your account into credit.

You seem to be expecting more than £850 but wanting only £100 of that to go towards repaying the overdraft. That's not how it works. All £850 will be repaid and you'll be in credit (which is a good thing). Following transactions may take you overdrawn again but that's a separate issue.

brettcta

Deleted_User said:

Brinny1982 said:

You should be able to pay back something you owe at anytime just seems odd there isn't an option for this

But you can pay it back any time you want.  You just have to pay money into your account.

I’m with the OP on this, not everyone is able to pay back an overdraft in full, especially larger facilities. Being able to chip away at it every month reduces the amount and removes any temptation to spend it after a few months of reducing your reliance on the facility.

i’ve used this feature before but I have had experience before (I can’t remember which bank) which required credit searches every month for a reduced OD facility as their systems would class it as removing a £500 OD and then applying for a £400 one.

it’s an oddity that any bank would put such blocks in place for customers looking to get their finances straight. You can quite easily reduce a credit card limit (provided you have the available credit to do so) so an OD shouldn’t be too much aggro.

brettcta

k12479 said:

Brinny1982 said:
So I don't have the option on my online banking when I get paid which is more than my overdraft to reduce it as in £100 or so per month, the guy in the branch couldn't understand it either, same as if you have a credit card your given the option to make a payment. With Lloyd's you can lower your overdraft amount at anytime online providing your in credit with them and not at your overdraft limit. You should be able to pay back something you owe at anytime just seems odd there isn't an option for this

I think you're trying to use an overdraft the wrong way. An overdraft is your account going negative. Any money that goes into your account will start to repay it.

If you pay in £100 your overdraft will reduce to £750 (the amount, not the limit). If you pay in £850 your overdraft will be repaid and your balance will be £0. If you pay in more than £850 your overdraft will be repaid and the left over will put your account into credit.

You seem to be expecting more than £850 but wanting only £100 of that to go towards repaying the overdraft. That's not how it works. All £850 will be repaid and you'll be in credit (which is a good thing). Following transactions may take you overdrawn again but that's a separate issue.

I think you’re reading it the wrong way.

OP has an £850 OD and presuming they’re using this in full each month, if they get paid £1,500 then they’ll only ever be £650 in credit. Presuming they were able to pay off £50/month and reduce the facility accordingly, then they’ll spend less time each month in the OD and more days in credit. As per my previous post, this should be easily done for any bank as it’s a really straight forward process. 

OP gets paid, they phone the bank that day when the account’s in credit and no where near the OD limit and reduce it by £50. Rinse and repeat until there’s no OD left and they’re in the black every month instead of using their OD facility.