Think I've just made a massive mistake - advice please

Hopeful0324

Hi everyone,

Just had a sinking feeling that I've made a big mistake. We are on a self managed DMP, all but one of the debts has been sold on. We are paying £5 a month to all our creditors and keeping them updated with income and expenditure and all going smoothly with no issues. The only debt that has stayed with the original creditor is Nationwide and it is with their recoveries department. A few years ago we had a letter advising that they had made some errors with sending out arrears statements and they had therefore marked the account as unenforceable due to their errors,

I recently applied to do a current account switch moving from Santander to Nationwide, trying to get the £175 switch fee. The switch is due to complete on Wednesday 17th Feb. I completely forgot about the link with the debt with Nationwide until today and my stomach dropped

I am concerned about the right of offset - will Nationwide now take any money paid into my new current account to pay back the defaulted loan or as they have marked the debt unenforceable can they still do this? Panicking now as don't want them to swipe all my wages when they go in at the end of the month.

Any help much appreciated. Thanks so much x

fatbelly

Yes it's a mistake.

But there is still a process to be gone through before exercising that right

https://www.financial-ombudsman.org.uk/businesses/complaints-deal/banking-and-payments/bank-accounts-right-set-off

https://www.handbook.fca.org.uk/handbook/BCOBS/4/?view=chapter (4.1.4A)

sourcrates

Banks are not that quick to act on these matters, you can also cancel the switch up to 7 days prior to it happening.

Wednesday is the 19th, not 17th.

Hopeful0324

Just checked Nationwide and it says I have to cancel 7 days before the switch so I have missed that cut off. Do you think it would be wise to immediately transfer any wages that go into the Nationwide account into another account then look to open a new account with someone else? I am so stupid - can't believe I didn't think of this before

fatbelly

You might be Ok

To quote Clint Eastwood

Do you feel lucky?

fatbelly

The bonus is to be paid within 10 days of meeting the criteria, which appear to consist of a switch, one big payment in and one debit card payment out.

I think I'd risk it but it's not my month's wages at risk

Is there any way you could put your money in and immediately make a big debit card payment to yourself?

Hopeful0324

Thank you both so much for your replies - I really appreciate it.

My thinking is to manage this Nationwide account very carefully until I get the bonus. I know exactly when DDs go out etc so could just transfer the DD amounts into the Nationwide account the day before they are due to go out. I can transfer £1000 in from my savings and immediately withdraw it and also make one small debit card payment so as to qualify for the bonus. I will transfer my wages straight out at midnight when I get paid next week. In the meantime I will open a new bank account and move everything over gradually from Nationwide. Any recommendations for the best current account?

Does this sound like a feasible plan? I've caused myself a right headache haven't I? If only I had chosen the First Direct switch option!! 

As an aside, I have a joint savings account with Nationwide with my son who has autism. Again the previous default hadn't crossed my mind at the time. It's his money but we have the account in joint names as he cannot manage money independently. There is £1500 in this account and it was opened in October last year. Nationwide couldn't take this could they? They haven't done anything yet and the account has been open for 5 months. As it is not solely in my name would they be able to take any of this? If so, I can transfer it into another savings account for him - don't want him losing any money because of me

Thanks again for all your help so far

Rob5342

For alternative bank accounts I would suggest Monzo or Starling. You can open an account in ten minutes and their apps are gar better than what other banks offer. 

Hopeful0324

Thank you so much - will get one opened this evening in preparation!! 

Hopeful0324

Sorry - one last query if that's ok? The switch has completed this morning - does the amount transferred into my new account count as part of the £1000 deposit needed for the £175? So just over £500 that was in my Santander has now moved over to Nationwide - do I only need to put another £500 in or does it have to be an additional £1000? 

Also, does anyone know if the balance has to stay in the account for a minimum length of time eg 24 hours or can I transfer it into the Nationwide account then take it out straight away as I don't ant to leave it in there for any longer than I have to?

Thanks so much  

fatbelly

I would guess that it doesn't. I think you have to transfer that sum in.

I had a look at the t&cs for you earlier and didn't see any minimum time that it has to stay. You may have a more detailed version somewhere