Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • Glittery
    • By Glittery 12th Oct 19, 10:42 AM
    • 138Posts
    • 872Thanks
    Glittery
    Change banks ? BAD banking habits to debt free
    • #1
    • 12th Oct 19, 10:42 AM
    Change banks ? BAD banking habits to debt free 12th Oct 19 at 10:42 AM
    Have been following Dave Ramseys babysteps and next week will be done with Baby Step 2 & 3 on the same day.
    That means we will be debt free and have a fully funded emergency fund.
    Never in my wildest dreams did I think we would get here.
    From over 50k debt, to this.

    We have been with Halifax a long time, and been awful.
    Bouncing payments and direct debits, maxed out overdraft of 5000, then slowly started reducing it and got it to 2400 (still always maxed out).

    So the plan now is to save hard for a house deposit, and get a mortgage next year if possible.
    Have checked out equifax and (unsurprisingly) it says score is very poor
    Do we
    a) stay with halifax and keep our deposit money in the account and hope they discount our previous bad history
    B) close halifax and open an account somwhere else and start fresh?

    Whichever account we have it will as of next week have a healthy balance of around 20k which we will add to over the next year and hope to double
    2018 25900
    201911950 to pay off
    4400 to pay off !
Page 1
    • Karonher
    • By Karonher 12th Oct 19, 10:57 AM
    • 699 Posts
    • 2,377 Thanks
    Karonher
    • #2
    • 12th Oct 19, 10:57 AM
    • #2
    • 12th Oct 19, 10:57 AM
    Overall would you say that Halifax have treated you fairly? If they have you may be better staying with them as you cant be sure about other banks.

    I would speak to them and see what they say the chances are.
    Getting ready for Christmas 2019

    Aiming to make 5,000 online in 2019.
    • Glittery
    • By Glittery 12th Oct 19, 11:02 AM
    • 138 Posts
    • 872 Thanks
    Glittery
    • #3
    • 12th Oct 19, 11:02 AM
    • #3
    • 12th Oct 19, 11:02 AM
    Overall would you say that Halifax have treated you fairly? If they have you may be better staying with them as you cant be sure about other banks.

    I would speak to them and see what they say the chances are.
    Originally posted by Karonher
    I'd say so yes.
    We have been blimming awful,it's not their fault.
    We concentrated more on other bills and then other debts than the overdraft.
    2018 25900
    201911950 to pay off
    4400 to pay off !
    • sourcrates
    • By sourcrates 12th Oct 19, 12:13 PM
    • 18,460 Posts
    • 17,356 Thanks
    sourcrates
    • #4
    • 12th Oct 19, 12:13 PM
    • #4
    • 12th Oct 19, 12:13 PM
    I'd say so yes.
    We have been blimming awful,it's not their fault.
    We concentrated more on other bills and then other debts than the overdraft.
    Originally posted by Glittery
    The majority of lending decisions these days are automated, your previous account conduct may be taken into concideration, it may not.


    The bank is always more able to take the hit financially, than you are, especially when your struggling, I don`t know if brand loyalty still has any leverage these days, but if it ain`t broke, don`t fix it.
    I'm a Board Guide on the Debt-Free Wannabe, Credit File And Ratings, and
    Bankruptcy And Living With It, boards. "I volunteer to help get your forum questions answered and keep the forum running smoothly".

    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views expressed are mine and not the official line of MoneySavingExpert.com.

    Helping you deal with problem debt.

    For free debt advice, contact either : Stepchange, National Debtline, CitizensAdviceBureaux.
    • Glittery
    • By Glittery 12th Oct 19, 9:18 PM
    • 138 Posts
    • 872 Thanks
    Glittery
    • #5
    • 12th Oct 19, 9:18 PM
    • #5
    • 12th Oct 19, 9:18 PM
    Good points.
    I don't think banks are how they once were,we have about 6 managers that rotator , and just a central call centre number.
    So I imagine it isn't up to them, And all automated like you say
    2018 25900
    201911950 to pay off
    4400 to pay off !
    • BabyStepper
    • By BabyStepper 13th Oct 19, 6:28 AM
    • 457 Posts
    • 1,998 Thanks
    BabyStepper
    • #6
    • 13th Oct 19, 6:28 AM
    • #6
    • 13th Oct 19, 6:28 AM
    I have to agree, the banks won't really mind what you've been up to, as long as it is all sorted now. As above posters have said, it's all automated. A couple of benefits to holding the same account for a long time, it looks good on your credit score, helpful for mortages, and also when I was looking for balance transfer ccs to shift debt, the bank I was with the longest gave me one quicklest and most easily.

    With no debt and 20k in the bank, as long as your credit score is good you can take your pick. Make sure you get a bonus for switching and don't pick an account with fees. Sounds as if you're just a bit embarrassed that the bank know your history - don't be. They won't remember.
    May '18 21,228.07/October '19 7,985

    62% paid

    Getting it done

    • kangoora
    • By kangoora 13th Oct 19, 8:52 AM
    • 814 Posts
    • 747 Thanks
    kangoora
    • #7
    • 13th Oct 19, 8:52 AM
    • #7
    • 13th Oct 19, 8:52 AM
    Is your 20k in interest paying accounts? If not, a transfer to a Santander 123 account may be worthwhile. This pays 1.5% on up to 20k, that would pay you around 25 month interest plus cashback on a lot of household/utility bills (we get about 9/month). There is an account fee of 5 for this however so you really need a large sum in there to offset the 5 fee and make it worthwhile.

    Alternatively Marcus Bank is paying 1.4% interest in their savings account on any amount currently so just leave standard monthly expenses going into your existing account and put any surplus into that.
    Last edited by kangoora; 13-10-2019 at 8:55 AM. Reason: Added savings account
    • Takmon
    • By Takmon 13th Oct 19, 9:27 AM
    • 834 Posts
    • 838 Thanks
    Takmon
    • #8
    • 13th Oct 19, 9:27 AM
    • #8
    • 13th Oct 19, 9:27 AM
    I have to agree, the banks won't really mind what you've been up to, as long as it is all sorted now. As above posters have said, it's all automated. A couple of benefits to holding the same account for a long time, it looks good on your credit score, helpful for mortages, and also when I was looking for balance transfer ccs to shift debt, the bank I was with the longest gave me one quicklest and most easily.

    With no debt and 20k in the bank, as long as your credit score is good you can take your pick. Make sure you get a bonus for switching and don't pick an account with fees. Sounds as if you're just a bit embarrassed that the bank know your history - don't be. They won't remember.
    Originally posted by BabyStepper
    Using the term "Credit Score" is a bit misleading because most people think of the credit scores generated by the CRA's which are never used as part of any mortgage or credit application.

    What they do see is the data on your credit report showing the last 6 years of how you have managed your credit and it's this information that they use when you apply for credit to determine if you are accepted or not.


    OP it's good advice to keep the Halifax account open because long term accounts are a positive in credit applications. There is no benefit in closing the halifax account because even if you do they will still keep records of how it was operated because they legally have to keep this for financial auditing reasons. But there is nothing stopping you opening accounts elsewhere in addition to make sure you get the best interest rate on your savings and to help manage your finances.
    • Glittery
    • By Glittery 14th Oct 19, 1:37 PM
    • 138 Posts
    • 872 Thanks
    Glittery
    • #9
    • 14th Oct 19, 1:37 PM
    • #9
    • 14th Oct 19, 1:37 PM
    I have to agree, the banks won't really mind what you've been up to, as long as it is all sorted now. As above posters have said, it's all automated. A couple of benefits to holding the same account for a long time, it looks good on your credit score, helpful for mortages, and also when I was looking for balance transfer ccs to shift debt, the bank I was with the longest gave me one quicklest and most easily.

    With no debt and 20k in the bank, as long as your credit score is good you can take your pick. Make sure you get a bonus for switching and don't pick an account with fees. Sounds as if you're just a bit embarrassed that the bank know your history - don't be. They won't remember.
    Originally posted by BabyStepper
    Definitley is embarrassing, but also want the best chance of a smooth mortgage application.
    Hope our credit score changes from Very Poor, maybe we need to take out a card and build our score, or keep our 2400 overdraft but never use it?
    2018 25900
    201911950 to pay off
    4400 to pay off !
    • Glittery
    • By Glittery 14th Oct 19, 1:41 PM
    • 138 Posts
    • 872 Thanks
    Glittery
    Is your 20k in interest paying accounts? If not, a transfer to a Santander 123 account may be worthwhile. This pays 1.5% on up to 20k, that would pay you around 25 month interest plus cashback on a lot of household/utility bills (we get about 9/month). There is an account fee of 5 for this however so you really need a large sum in there to offset the 5 fee and make it worthwhile.

    Alternatively Marcus Bank is paying 1.4% interest in their savings account on any amount currently so just leave standard monthly expenses going into your existing account and put any surplus into that.
    Originally posted by kangoora

    Thank you for this info!
    Santander was one of the banks recommended for self employed mortgages.
    So may be helpful having the cash in there and adding to it over the next year
    2018 25900
    201911950 to pay off
    4400 to pay off !
    • Glittery
    • By Glittery 14th Oct 19, 1:43 PM
    • 138 Posts
    • 872 Thanks
    Glittery
    OP it's good advice to keep the Halifax account open because long term accounts are a positive in credit applications. There is no benefit in closing the halifax account because even if you do they will still keep records of how it was operated because they legally have to keep this for financial auditing reasons. But there is nothing stopping you opening accounts elsewhere in addition to make sure you get the best interest rate on your savings and to help manage your finances.
    Originally posted by Takmon
    This is what I think we should do, thank you.

    Hope that one year of good behaviour and doubling savings from 20 -40k Will offset our terrible past
    2018 25900
    201911950 to pay off
    4400 to pay off !
    • EssexHebridean
    • By EssexHebridean 14th Oct 19, 2:51 PM
    • 9,510 Posts
    • 48,990 Thanks
    EssexHebridean
    Thank you for this info!
    Santander was one of the banks recommended for self employed mortgages.
    So may be helpful having the cash in there and adding to it over the next year
    Originally posted by Glittery
    Have your 20K in there and then see if they have a suitable savings product for anything more - or as others have said take a look at Marcus. there's no sense in having any more than the threshold for interest payments in an account as everything past that point is earning you nothing.

    Personally I'd drop that O/D limit a bit - we keep a small facility in place on each of our accounts but it's there only to take account of a small miscalculation meaning we go a few 's over.

    If neither of you have owned a property before then a Help To Buy or Lifetime ISA might be worth looking at for savings as well.
    MORTGAGE FREE 30/09/2016
    SOA CALCULATOR (for DFW newbies): Stoozing.com SOA Calculator
    • Glittery
    • By Glittery 14th Oct 19, 10:09 PM
    • 138 Posts
    • 872 Thanks
    Glittery
    OH has never owned a property so could get a Help to Buy ISA
    I had heard that you can only open with 1200 and put a max of 200 a month in.
    Is it still worth doing for only 12 months?
    2018 25900
    201911950 to pay off
    4400 to pay off !
    • EssexHebridean
    • By EssexHebridean 15th Oct 19, 10:08 AM
    • 9,510 Posts
    • 48,990 Thanks
    EssexHebridean
    There's an excellent guide about HTB ISA's on the main MSE site - that should tell you all you need to know. I believe the bonus is still payable even after 12 months? If so - then yes, it would be if you can't get a higher equivalent in interest elsewhere.
    MORTGAGE FREE 30/09/2016
    SOA CALCULATOR (for DFW newbies): Stoozing.com SOA Calculator
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

1,785Posts Today

6,993Users online

Martin's Twitter