Are Banks allowed to refuse to give specifics reason for declining extension of overdraft?

enthusiasticsaver

Overdrafts can be withdrawn at short notice and are one of the most expensive ways of borrowing so not sure why you want it anyway. Regardless they don’t need to give a reason but if you don’t normally use the facility maybe they don’t want customers to be approved with limits they don’t use. It is unprofitable for them I guess as you aren’t paying fees/interest. 

Bridlington1

enthusiasticsaver said:

Overdrafts can be withdrawn at short notice and are one of the most expensive ways of borrowing so not sure why you want it anyway. Regardless they don’t need to give a reason but if you don’t normally use the facility maybe they don’t want customers to be approved with limits they don’t use. It is unprofitable for them I guess as you aren’t paying fees/interest. 

Other than when I'm stoozing, the only real advantage of overdrafts for me is that they can be quite useful if you want to write a cheque. I have a £2.5k arranged overdraft facility with Nationwide so whenever I open a savings account by post (less common these days to be fair) I will usually write a cheque for my opening deposit from Nationwide and then keep the account at a nil balance with enough money to cover the cheque in a high paying easy access account. As soon as the cheque is taken I repay the overdraft fully using the money that is in the easy access account so that I never pay any overdraft fees and do not have money sat in a current account earning little or no interest whilst I wait for the cheque to be taken.

pridehappy

I have 3 small overdrafts across 3 current accounts instead of 1 large one as I personally find this more useful for budgeting and each one is adding to my credit score even further instead of just one bank. 

I found Nationwide to be the easiest to setup and the most accepting to receive. Virgin Money was a little hassle sending proof of income. Haven’t touched the Lloyds Bank one for years but my sister had a similar experience to you with them instead.

jimjames

Richard1212 said:

The answer is " they can do whatever suits their own interests" as is the case with all banks. I'd really miss a large overdraft facility ----and I have a 5 figure overdraft on 2 accounts with NatWest. 

Why would you need to run a 5 figure overdraft on 2 accounts when you have so much money invested and savings? For the cost of overdrafts it makes absolutely no sense to be in excess of £10k overdrawn.