Moving House & Setting up Direct Debits

AnnaUni

Hey

I'm moving into a house soon, and looking for some help. I know when we move in we need to call the suppliers and let them know we've moved in, but if we want to pay by direct debit will we need to give them the bank details there and then?

Also, if we pay by direct debit, what happens if there are insufficient funds in the account when a payment is due?

Anything else I should know?

Premier_2

When a utility company agrees to supply someone energy on credit, there is a huge amount of trust the company is placing in that individual. In essence, the company is lending the customer money and expects it back on demand.

The questions you pose make me wonder whether a pre payment meter would not suit your need better.

However, to address your questions directly. When you move into the house, the account holder will be assessed for credit risk. The company may ask for a deposit before agreeing to a traditional credit agreement (i.e. payment on receipt of bill every 3 months) to reduce the risk they are exposed to.

By agreeing to regular monthly payments (by Direct Debit) the company will accept this is a lesser risk than the traditional agreement. Of course the company will need your bank details - they can't set up the DD mandate without them. Subject to status, such a monthly payment plan is often accepted, and because of the reduced risk, no deposit is required.

Also, as a result of regular monthly payments, you would often be entitled to additional discounts because of the lower risk, the regular payments (helping the company's cash flow) and the lower cost of collecting direct debit payments.

If you don't have sufficient funds in your bank account at the time of collection, whether the bank pays depends on its policy; it may pay, it may not. Either way, the bank usuallly charges you (the amount and legality of which is a whole different topic currently being established in court)

Assuming the bank pays. the utility company will be none the wiser.

Assuming the bank does not pay, depending on the amount of goodwill you as a customer has built up previously, expect your standing with the credit provider (i.e. the utility compnay) to be severly affected. Typical action would be to transfer you to a standard tariff, eliminating any discount for DD, demanding the deposit that normally applies to such agreements, and expecting you to pay any outstanding debt that may have accrued.

At worst, the supplier may lose all faith in you as a credit risk and decide the only way forward is with the installation of a pre-payment meter which most companies charge higher rates for.

IKWeb

If you move into the house tho and say the supply is with British Gas and you decide to stay with them and setup an account they DO NOT run a credit check..... its only if you change to another company then you will find they will then do a credit check on you.
Also the information above can vary, If you miss 1 or 2 DD payments then this would be oki, but if you were always missing your DD payments then yes the DD payment plan would get canx and your account would fall onto a 3 month billing cycle, and then finally if payments were still no made, LAST LAST option by the energy company would be to remove the meter for a PrePayment meter, but this is always last option and does take repeat lack of payments by yourself, so the comments above are right but the way its been worded makes it sound allot more scary than it is..

Just make sure you budget yourself and you should be fine.

Premier_2

IKWeb wrote: »

If you move into the house tho and say the supply is with British Gas and you decide to stay with them and setup an account they DO NOT run a credit check.....

I'm not sure they ever run a formal credit check as such. In my experience they tend to base their risk assesment on your past history with them. If you have no past history (perhaps because this is your first home), or it is poor, that is when they will require a deposit.

Surely they don't base their risk assessment on the previous account holder - that's of absolutely no use.

AnnaUni

IKWeb wrote: »

If you move into the house tho and say the supply is with British Gas and you decide to stay with them and setup an account they DO NOT run a credit check..... its only if you change to another company then you will find they will then do a credit check on you.
Also the information above can vary, If you miss 1 or 2 DD payments then this would be oki, but if you were always missing your DD payments then yes the DD payment plan would get canx and your account would fall onto a 3 month billing cycle, and then finally if payments were still no made, LAST LAST option by the energy company would be to remove the meter for a PrePayment meter, but this is always last option and does take repeat lack of payments by yourself, so the comments above are right but the way its been worded makes it sound allot more scary than it is..

Just make sure you budget yourself and you should be fine.

Thanks, this is a lot more helpful than the above post, which seems to assume I just have no idea how to handle money.

I realise the company will need our bank details to set up the direct debit, my question was whether we'll have to give them those details straight away when we phone up on the first day of moving in, or whether it would be possible to phone them when we move in, telling them we've moved in, then give them the bank details a couple of days later when we have things sorted out?

IKWeb

Its your choice on when you give them to the company, they can take them from you when you move in and setup the account this would be the best way to get everything setup for you, or you can ask for a mandate form to be sent out to you fill in and send back.. its totaly your choice.

As to Premier reply only on a new supply, experian's services are used to do a credit check. on a normal move in to a house NO credit vet is done.

Incisor

AnnaUni wrote: »

Hey

I'm moving into a house soon, and looking for some help. I know when we move in we need to call the suppliers and let them know we've moved in, but if we want to pay by direct debit will we need to give them the bank details there and then?

Also, if we pay by direct debit, what happens if there are insufficient funds in the account when a payment is due?

Anything else I should know?

Yes. Take careful readings of gas, electricity and water as your very first action after gaining entry and keep them safely

Premier_2

AnnaUni wrote: »

Thanks, this is a lot more helpful than the above post, which seems to assume I just have no idea how to handle money...

I'm sorry you were not happy with the advice given, but you did ask!

Let's look at what you actually wrote, rather than what you assumed I assumed.

About 4 months ago, you were thinking about about setting up a joint bank accout with you and 4 housemates in preparation for a house share in the forthcoming educational year. You were strongly advised not to.
http://forums.moneysavingexpert.com/showthread.html?t=741781

Last week, you seemed to be thinking about setting up the bill accounts in multiple names. I responded giving you the advantages and disadvantages of doing so.
http://forums.moneysavingexpert.com/showthread.html?t=973703

Now you say in the opening post

AnnaUni wrote:

...if we want to pay by direct debit...

So have you ignored the good advice given earlier?

...and in the OP here you asked

AnnaUni wrote:

Also, if we pay by direct debit, what happens if there are insufficient funds in the account when a payment is due?

:rolleyes:

SwanJon

I could be wrong, but most suppliers in my experience don't credit vet at move in as there is very little point.
They can't stop you moving in.
They can't stop you using energy without a warrant.
They won't get a warrant unless they have evidence you are avoiding your bills.
The costs involved in getting a warrant and exhanging/removing the meter outweigh the risks of letting someone pay their bills.
All the above goes for security deposits too - what would they do if you refused to pay?

Premier_2

SwanJon wrote: »

...All the above goes for security deposits too - what would they do if you refused to pay?

Arrange to have a pre-payment meter fitted

SwanJon

Premier wrote: »

Arrange to have a pre-payment meter fitted

On what grounds? You don't owe them any money.
Unless you agree, they'll have to go to court for a warrant, and I can't see a judge granting them one because you didn't pay a security deposit.