Bank putting an unauthorised overdraft on account with no notice.

sdooley

without a signed consumer credit agreement the debt is unenforceable

ask the bank if they have this as evidence

I hate to say it but it may be that someone's

Keeping_Positive

I would switch accounts so they dont swallow up any more of her money then arrange to pay back at a pace thats reasonable for her. Does she need to have a credit rating? If not then I wouldnt worry about further damage to it.

I bank with Natwest and have never had a problem but although in debt I have never missed a payment so am down as a good customer. I know they arent nice to all.

Also make sure she understands whats happened so it doesnt repeat its self.

sdooley

without a signed consumer credit agreement the debt is unenforceable

ask the bank if they have this as evidence

I hate to say it but it may be that someone's been helping themself to your mother's funds or is ripping her off - £2,500 is a lot of money to spend if you're normally careful. If she's embarrased to say about one thing she may be about another.

Also, if there have been banking charges, reclaim them!

TEDDYRUKSPIN

Excellent. All valid points.

Who fault is this? Majority of it will be the customer but this time partially the bank as well.

It seems the bank has come to a compromise but one which is not affordable to the customer. I would suggest your mother to renegotiate with the lender.

This APR for such a small term is very common with high street lenders.

I would also suggest your mother to write a letter of complaint to the bank. Wait for a response, roughly 5 days. Then write another to the financial ombudsman service.

Good luck

YorkshireBoy

TEDDYRUKSPIN wrote: »

I would also suggest your mother to write a letter of complaint to the bank. Wait for a response, roughly 5 days. Then write another to the financial ombudsman service.

...who will then bounce it straight back to you because you haven't allowed the bank the requisite 8 weeks to resolve the matter.

Details on the NatWest & FOS websites.

jamesd

The problem for NatWest is that your mother had no knowledge of the facility and innocently spent the money, presumably believing the funds available report from the ATM and knowing that she had not requested any credit facility so it had to be her money. That could mean that NatWest is simply told that it must write off the money.

I suggest that you approach them and suggest:

1. Switching the account to one that has no overdraft facility available so that this can't happen again.
2. Refund of all interest and charges to date.
3. Arranging a loan at 0% interest with affordable repayment rate based on your mother's income and expenses.

4. If you are able to pay the money, consider offering to do that subject to refund of all interest and charges if they are inflexible on the options above. Then set up a repayment plan from her to you via standing order for a set period.

Absent that, invite them to consider their chances of persuading a court that someone who didn't even know what an overdraft was had knowingly agreed to borrow this money from them and was not instead an unknowing victim of their actions.

Your mother is the wronged party here, not NatWest. Finding a way to repay them without her losing out due to their actions is the way to go.

Meltdown_2

Natwest DO give you an overdraft facility on your current account - without you either requesting it or agreeing to it. And, as has been mentioned, this is then included in the "available balance" that is displayed to you. It can be a little confusing if you have not come across this technique before.

But can it really be, as sdooley seems to imply, that Natwest customers who neither requested nor agreed to their overdraft facilites are free to use that overdraft without Natwest being able to get the money back?

jamesd

Meltdown, yes, it can be because there's a well-established innocent mistake doctrine in UK law. If you do honestly believe that the money was yours then it may be impossible to recover it. Pensioner ignorant about what an overdraft is and just using a cash machine without having ever requested a borrowing facility might well be a perfect example case. And regardless of perfect, a nice example for a TV consumer rights program, since it's clearly what such a program would call "irresponsible lending".

NatWest screwed up here. No more, no less. They get to hope that they can unwind this without too much pain for them. They can do it... provided they stop trying to compound the error with high rate loans as the only unwinding option they offer.

Well, not so much screwed up as this being one of the cases where offering unsolicited credit facilities can backfire, a business risk NatWest knew about and decided to accept when it decided to adopt the practice.

The lenders at Zopa could offer better terms than the loan NatWest is offering if it ever does seem that a loan is the only way.