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Up against overdraft limit?

(16 Posts)
InaneNameChange Thu 09-Jan-14 13:01:45

I'm in a weird situation at the moment as have lots of stuff going on, but I'm not working. I checked my bank account today and I am right up against my overdraft limit. I thought I was a few hundred short of that (I know, I know, I should have had a tighter eye on it over the Christmas period).

It's given me a bit of a shock and I think I need to get back to work ASAP so will throw myself at anyone who will take me next week, but what do I do about my overdraft? Assuming I get back to work soon then it's fine, I would like to keep my overdraft facility as a safety net so am wary about informing the bank of my current situation, and am aware of the OD charges per month and it's doable (as long as I'm working...).

But if I don't get back to work soon would they refer me to a debt agency? I don't have any other debt and do have things to sell, which I'll need to crack on with. I think I have about £10 to last a week which is fine because I have lots of food in and am stocked up for other essentials. At the most I would need milk, vegetables and loo roll. This is like being a student again!

SantasLittleMonkeyButler Thu 09-Jan-14 13:10:09

Won't the bank know that you are not earning at the moment, due to seeing no or fewer payments in?

I have had a bank decide to just 'remove' my overdraft facility in the past - shitty Lloyds many many years ago angry.

No idea whether this is common practice though.

Rockchick1984 Thu 09-Jan-14 13:13:55

Your overdraft limit is an agreed amount, so as long as you're not going over the limit regularly it's highly unlikely the bank will withdraw the facility - probably only if the account went completely unused for a significant amount of time (6 months + as a bare minimum). If they decided to, they have to give you notice (usually 30 days) to repay it, if you don't it becomes an unauthorised overdraft and you would start accumulating charges on it.

In theory an overdraft can be withdrawn by the bank at any time with the right notice, in practice they don't do it without a very good reason smile

InaneNameChange Thu 09-Jan-14 13:16:31

Eeek Santas please don't say that!!
I love having my OD facility. Can't believe I've been so cavalier over Xmas.
I guess they might know over the long term but wouldn't have thought they would 'look' at individual ODs in any detail? I've got a lump sum going in next week so I hope that would stave off any questions.

I'm so lucky that I have everything in already, I really don't need anything apart from food for the next month. I will want to smoke and buy wine but I just can't. I even discovered an old bottle of expensive serum so thought 'yes! I can still dress in my old cashmere and slather this on my face!' It's a year old mind but I don't care.

InaneNameChange Thu 09-Jan-14 13:17:33

Thanks Rockchick - hopefully I'll get it paid off within the next 3 months.

Middleagedmotheroftwo Thu 09-Jan-14 13:22:50

Inane - they don't "look" at individual accounts and ODs. They have reports which run which would flag up, for example, that there are 50 overdrawn accounts with no monthly wage payments going in.

If I were you, I'd take advice from your bank before they put some restrictions on your account. Banks are usually happy to help if you're open and honnest with them.

InaneNameChange Thu 09-Jan-14 13:28:53

Middleaged, thanks, I'm not quite sure what to do; I got forced into going onto ESA for the short term whilst waiting for a legal matter to be resolved. I would like nothing more than to be independent again and think I might shirk the ESA early if I find work.

It won't be what I used to do but I don't care at this stage.

Is this honestly worth telling my bank about? I know I have probably hit their generated system so they will write in due course but I was hoping that as I cashed in some shares and that's coming through next week then it would defer the situation...for now!

SantasLittleMonkeyButler Thu 09-Jan-14 13:30:15

Mine was taken away for having been in the red for too long - so when my monthly salary went in it wasn't clearing the OD. Although they were aware of my monthly salary when they set my limit - anyway ho hum confused.

I'm sorry to have worried you though - this was 1999. Banking has changed quite a bit since then smile and yes, if you have a lump sum going in next week, I would expect everything to be fine for you.

CogitoErgoSometimes Thu 09-Jan-14 13:36:51

"Is this honestly worth telling my bank about?"

Always. If you flag up a potential problem but reassure them that there is a solution round the corner (cashing in the shares) then they can either offer a short extension to the agreed limit or agree to waive any charges. Say nothing and you'll just be flagged up for 'unauthorised borrowing' if/when it happens.

Middleagedmotheroftwo Thu 09-Jan-14 13:41:25

Agree with Cogito. Banks will always try to help. The FCA says they have to.
They will be much more helpful though if you are up front and honnest with them, and tell them you are experiencing temporary diffiiculties, and that you are expecting £xx in yy weeks.

You never know, they might also be able to suggest some help, like switching to a different type of account for example.

InaneNameChange Thu 09-Jan-14 13:42:39

Hmmm Cogito. I really hate this situation and can't wait for it to be over but I hate telling people. The response is usually 'aah poor you' but I am not used to this, I always was so independent and didn't do debt. I think I let it get out of hand over the last month.

I might contact the bank then. And hope they let me keep my OD over the next few months. Luckily I'm not into 'unauthorised' borrowing as yet but it's a bit scary. It's given me a huge kick to get back to work, I don't care if anyone else tells me I should have longer off!

InaneNameChange Thu 09-Jan-14 13:44:41

Ok Middleaged, thanks, looks like I'll have to 'fess up. I can always overexaggerate about my situation and then they would feel stricken for me smile <manipulative>

Thanks for the advice.

CogitoErgoSometimes Thu 09-Jan-14 13:54:54

Retail Banks are just shops where you can buy or keep money. Like any other shop, the more info you give them the better they are able to meet your needs. They only get arsey IME when they don't know what's going on. Don't exaggerate, just tell them the truth.

InaneNameChange Thu 09-Jan-14 14:00:18

Cogito I guess, I'm just not used to having discuss personal matters with something (outwardly) as impersonal as a bank.

Thanks though, I will write to them. And hope they don't bark in shock and pack me off to a debt collection agency immediately. It will hopefully only be three months and then it will all be gone and I'll be back to normal. With or without OD facility <cries>

CogitoErgoSometimes Thu 09-Jan-14 14:35:55

They want your custom. You're actually a more useful customer if you have an overdraft and you're paying nice fat interest charges each month than if you're a customer always in credit and paying nothing. Provided they see you as a good risk, stretching your O/D a little will have them rubbing their hands.

Middleagedmotheroftwo Thu 09-Jan-14 14:42:40

And I wouldn't think of them as impersonal either. They know exactly how much you earn, and what you spend your money on, and where! No secrets from banks!

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