Unarranged overdraft cheaper than arranged?

BDeluxe

I've just been looking into this as I've been living in my NatWest overdraft this past few months, I know I need to get out as they're charging me £50 a month for the pleasure.

I've been on the site calculator and it says an unarranged overdraft is capped at £19? Why would anyone agree to an arranged overdraft? I'm bloody fuming!

eskbanker

Since the overdraft charging regime was changed a couple of years ago, banks have been imposing preventive controls, so that those without an arranged overdraft won't be able to go into unarranged overdraft, i.e. direct debits may be bounced, card transactions declined, etc, so it's not simply a choice of arranged versus unarranged, and if you don't have an agreement with the bank they won't lend you the money....

https://forums.moneysavingexpert.com/discussion/comment/79413754/#Comment_79413754

BDeluxe

Thanks for that.

They make it so punitive I'm probably just going to plump for an IVA at this point, I don't want to but they are taking the !!!!!! with what they are charging which gives me little choice as things are only going to get much worse when the fuel bills start rolling in.

eskbanker

BDeluxe said:

Thanks for that.

They make it so punitive I'm probably just going to plump for an IVA at this point, I don't want to but they are taking the !!!!!! with what they are charging which gives me little choice as things are only going to get much worse when the fuel bills start rolling in.

If you're right up against it and in financial difficulty (as opposed to simply unhappy with the interest rate charged on your overdraft) then worth spending some time on the links from the above post, i.e. the MSE guide to overdraft costs and the debt-free wannabe board.

As outlined at https://www.moneysavingexpert.com/banking/cut-overdraft-costs/#cantswitch, the first port of call is to talk to the bank (their obligations are explained at https://www.handbook.fca.org.uk/handbook/CONC/5D/?view=chapter ), but there are also independent debt charities who can offer assistance....

Dimanche_Prochain

BDeluxe said:

Thanks for that.

They make it so punitive I'm probably just going to plump for an IVA at this point, I don't want to but they are taking the !!!!!! with what they are charging which gives me little choice as things are only going to get much worse when the fuel bills start rolling in.

You really need to speak to one of the debt charities.

Bankruptcy or a DRO may be a better option but with no information, nobody on here can advise you, and they probably should not.

Try https://www.stepchange.org/ or https://nationaldebtline.org/

You need to actually speak to them over the phone and they can help.