M&S mistake and account when to overdraft
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CuriousUser
Posts: 30 Forumite
Hello,
I have an M&S credit card with a 32 months free interest for a balance transfer. I did a balance transfer from another credit card of £1,402 and then I called M&S (4th January) so I can set up a Direct Debit of a minimum payment but still to clear off the balance before I will be charged any interest. The lady I spoke with did it for me and said £50 will be collected each month.
Now Friday evening I saw a transaction of £1,402 showing up on my Debit Card statement so I called M&S who admitted that it was an error and the Direct Debit was not changed as I requested and to try and cancel with my Debit Card bank the transaction and make manually the payment to them (I paid £60 to them). My bank said they can't as it has to be prior to 2 working days. Now my Debit Card went to overdraft -£1,203 so called up M&S who said that they can reverse the transaction and pay me compensation to cover up the overdraft fees but I told them I am worried about my credit score as it has been excellent. My Debit card bank said my score might be affected or not, they can't say for sure.
M&S said they will reverse it today but will not show up straight away and it might take up to 5 working days which my bank will charge me overdraft fees (covered by M&S) but my credit score might be affected. I declined the offer made by M&S and said I am not interested in compensation, I just do not want my credit score to be affected and they said they have to speak with someone higher for a resolution and call me back.
Now, if you made it that far (thank you!) will my credit score be affected you think?
Also, what other options do I have here in order to avoid getting there?
Thank you,
I have an M&S credit card with a 32 months free interest for a balance transfer. I did a balance transfer from another credit card of £1,402 and then I called M&S (4th January) so I can set up a Direct Debit of a minimum payment but still to clear off the balance before I will be charged any interest. The lady I spoke with did it for me and said £50 will be collected each month.
Now Friday evening I saw a transaction of £1,402 showing up on my Debit Card statement so I called M&S who admitted that it was an error and the Direct Debit was not changed as I requested and to try and cancel with my Debit Card bank the transaction and make manually the payment to them (I paid £60 to them). My bank said they can't as it has to be prior to 2 working days. Now my Debit Card went to overdraft -£1,203 so called up M&S who said that they can reverse the transaction and pay me compensation to cover up the overdraft fees but I told them I am worried about my credit score as it has been excellent. My Debit card bank said my score might be affected or not, they can't say for sure.
M&S said they will reverse it today but will not show up straight away and it might take up to 5 working days which my bank will charge me overdraft fees (covered by M&S) but my credit score might be affected. I declined the offer made by M&S and said I am not interested in compensation, I just do not want my credit score to be affected and they said they have to speak with someone higher for a resolution and call me back.
Now, if you made it that far (thank you!) will my credit score be affected you think?
Also, what other options do I have here in order to avoid getting there?
Thank you,
0
Comments
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Firstly there's no point in obsessing about a credit score itself, which is essentially a made up number that isn't seen by any lenders.
It is possible that your bank may report your use of overdraft facilities but that really depends on the timing of their data feeds to the credit rating agencies - I don't think there'll be anything you can do about it anyway, because M&S can't influence what's provided to the CRAs by a third party (your bank) and your bank is unlikely to be willing to change what they report if it's factually accurate.
So, your credit files may be affected but it's unlikely to be of any huge significance, unless perhaps you're looking at an imminent mortgage application?0 -
Firstly there's no point in obsessing about a credit score itself, which is essentially a made up number that isn't seen by any lenders.
It is possible that your bank may report your use of overdraft facilities but that really depends on the timing of their data feeds to the credit rating agencies - I don't think there'll be anything you can do about it anyway, because M&S can't influence what's provided to the CRAs by a third party (your bank) and your bank is unlikely to be willing to change what they report if it's factually accurate.
So, your credit files may be affected but it's unlikely to be of any huge significance, unless perhaps you're looking at an imminent mortgage application?
I am looking to apply for a mortgage in the next 1 year and a half - 2 years. M&S said they will provide a letter which states that the fault was at their end so I can pass it to my bank which will explain the issues they had with their sistem. Will that be beneficial to get, I agreed and they reversed the transaction and offered me £100 gesture of goodwill.0 -
Do you currently have an agreed overdraft with your bank or have you gone into an unauthorized overdraft?0
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maxximus75 wrote: »Do you currently have an agreed overdraft with your bank or have you gone into an unauthorized overdraft?
It might sound silly, but I had no idea that I have an overdraft so to answer, I don't know. My bank said they will charge £25 interest for it if it's going to take up to 5 days for the reversed amount to be back.0 -
CuriousUser wrote: »I am looking to apply for a mortgage in the next 1 year and a half - 2 years. M&S said they will provide a letter which states that the fault was at their end so I can pass it to my bank which will explain the issues they had with their sistem. Will that be beneficial to get, I agreed and they reversed the transaction and offered me £100 gesture of goodwill.
If the transaction affects your credit file at all, it will long have vanished in 1.5 to 2 years' time.
The £100 sounds a good offer, though how good it is depends on how much your overdraft charges will actually be. How much will you have to pay?0 -
CuriousUser wrote: »It might sound silly, but I had no idea that I have an overdraft so to answer, I don't know. My bank said they will charge £25 interest for it if it's going to take up to 5 days for the reversed amount to be back.
You either have an overdraft facility or you don't. It sounds as you might not have one. Your bank can help you figure that out if it isn't obvious from looking at your account.
You can get overdrawn whether you have an overdraft facility or not. If you don't have one, you will pa the charges for unarranged overdrafts.
If the total charge is £25, the £100 offer from M&S sounds good, as you will still be in clover. I would hold a decision until I knew the exact amount of overdraft charges.0 -
And to try and cancel with my Debit Card bank the transaction and make manually the payment to them (I paid £60 to them). My bank said they can't as it has to be prior to 2 working days.
Actually I think you should complain to your bank because you were incorrectly advised. Under the direct debit guarantee a bank must cancel the direct debit immediately on your request. In addition, if they did not cancel the direct debit then when it came through they should have refunded it immediately.
https://www.directdebit.co.uk/DirectDebitExplained/pages/directdebitguarantee.aspx
If I were you I would make an official complaint to your bank that they did not immediately cancel a direct debit on your instruction, and that they did not immediately refund a direct debit that was taken in error.
In the meantime accept the fair and reasonable offer from M&S for compensation. Bear in mind that this might show up on your report, but financial institutions cannot change or manipulate what is reported to credit agencies, they are factual statements about your account. However, it is extremely unlikely to affect a lenders decision to offer you a mortgage in the future and therefore it is not worth worrying about.0 -
You either have an overdraft facility or you don't. It sounds as you might not have one. Your bank can help you figure that out if it isn't obvious from looking at your account.
You can get overdrawn whether you have an overdraft facility or not. If you don't have one, you will pa the charges for unarranged overdrafts.
If the total charge is £25, the £100 offer from M&S sounds good, as you will still be in clover. I would hold a decision until I knew the exact amount of overdraft charges.
I confirmed with the bank and it is £5 per day for anything above £10 overdraft. M&S will cover up to 5 working days and the £100.0 -
Actually I think you should complain to your bank because you were incorrectly advised. Under the direct debit guarantee a bank must cancel the direct debit immediately on your request. In addition, if they did not cancel the direct debit then when it came through they should have refunded it immediately.
https://www.directdebit.co.uk/DirectDebitExplained/pages/directdebitguarantee.aspx
If I were you I would make an official complaint to your bank that they did not immediately cancel a direct debit on your instruction, and that they did not immediately refund a direct debit that was taken in error.
In the meantime accept the fair and reasonable offer from M&S for compensation. Bear in mind that this might show up on your report, but financial institutions cannot change or manipulate what is reported to credit agencies, they are factual statements about your account. However, it is extremely unlikely to affect a lenders decision to offer you a mortgage in the future and therefore it is not worth worrying about.
My bank stated that it's not their fault as the transaction went through already when I contacted them. Friday the direct debit payment was already showing up on my transactions. Now M&S credited the £100 promised but my account is still in overdraft zone so waiting for a reversal to take place by Friday if not I would be calling M&S again.
I am not that worried now and probably the letter from M&S will be enough to explain what went wrong and that it was not my fault.0 -
Assuming you have presented us with the facts of the incorrect transaction, you were wrongly advised by your bank. If a payment has been taken on the wrong date you are entitled to an immediate refund of the amount debited from your bank under the Direct Debit Guarantee. https://www.directdebit.co.uk/DirectDebitExplained/Pages/Incorrectpayments.aspxCuriousUser wrote: »My bank stated that it's not their fault as the transaction went through already when I contacted them. Friday the direct debit payment was already showing up on my transactions. Now M&S credited the £100 promised but my account is still in overdraft zone so waiting for a reversal to take place by Friday if not I would be calling M&S again.
I am not that worried now and probably the letter from M&S will be enough to explain what went wrong and that it was not my fault.0
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