HSBC Overdraft query

pmchapman

I had a very entertaining call from HSBC yesterday with one of their very frustrating indian/yank operators. I've got a student account which I still use the interest free overdraft to earn a bit of interest in a high interest account, but the woman was saying that I need to make regular payments otherwise they would make changes to my credit score. Is this the HSBC credit score or my actual credit rating? Now i've read the terms of the account and it does say this, but what constitutes regular payments? She reckoned it was once every 30 days but can't find that in writing anywhere.

Anyway, as a good will gesture I offered to pay over £50, to which she asked if i'd like to bump it up to £100...I kindly declined and intend on taking the £50 back out! She got a but shirty with me and said that they needed my commitment to pay in regularly..."Do we have your commitment Mr Chapman, do we?!"

I thought it was all a bit of a joke but don't want to damage my credit rating. Has anyone else experienced similar? Does staying overdrawn for a long period affect my credit rating even though its 0%?

ShelfStacker_3

It's in the terms and conditions (which very handily I have a copy of to hand), clause 7.8: "Whenever your account is overdrawn you should make regular payments into your account. You must tell us if you are unable to do this."

You agreed to it, I'm afraid... most banks have similar clauses, and would probably interpret your not paying back your overdraft as a missed repayment. I mean, you ARE borrowing from them, you will have to repay the money. I'm sure they'd have very good grounds for reporting it to a credit reference agency, especially if you carry on refusing to repay now they've warned you of the consequences.

pmchapman

Yeh i'd seen that but does it say anywhere what classes as 'regular'?

gt94sss2

pmchapman wrote: »

I thought it was all a bit of a joke but don't want to damage my credit rating. Has anyone else experienced similar? Does staying overdrawn for a long period affect my credit rating even though its 0%?

It shouldn't affect your external credit rating - but the lack of activity will probably lead to HSBC eventually cancelling the overdraft on your account.

Regards
Sunil

ShelfStacker_3

pmchapman wrote: »

Yeh i'd seen that but does it say anywhere what classes as 'regular'?

No. Phone them up and ask them. I personally would define "regular" as being monthly or weekly, but they obviously may not agree with that.

Just to make a point: it's ALWAYS worth taking the 10, 20 minutes out of your time to read the terms and conditions of your accounts or credit cards or whatever. ALWAYS.

Purple_Peril

As it's a student account I should have thought that payments once a term (on receipt of your student loan cheque) should count as regular - but it might be worth contacting them and explaining your thinking behind this.