Banks Overdraft Charges

[TheAnimus]

Actually I think that some of the banks are taking the piss a bit now.

But its also due to that voucher website which has IFA pretensions money saving expert encouraging everyone and their dog to claim back fees, sometimes hundreds of pounds for their own repeated irresponsible behaviour with regards to over draft fees.

Martin Lewis went around day time TV encouraging students and other reckless types to claim back their fees, ultimately a few indeviduals with no sense of responsibility came along and took advantage of that system a little too much, I think he played a big part in the courts siding with the banks, because it was quite simply unfair that the banks had to defend actions against someone who was claming back their fee for every month they went over-over drawn.......

Thats a rant over.

In the OPs case a little bit more politeness in wording might do wonders with this.

[Saracen]

You could always choose not to have an account. If you want to avail yourself of banking services, there are rules.

And there are laws governing when contract rules are fair, and voiding them when they are not.

....

It isn't only the OP who goes overdrawn; what do you want, a free-for-all? I recall you vociferously moaning about a Government that spent what it didn't have. You speak with forked tongue.

No, I don't want a free-for-all, and I've said, repeatedly, that charges for going overdrawn are fine (and I mean fine as in okay, rather than fine as in monetary penalty). It's the scale of the charges, in relation to either the 'offence' or the costs imposed on the bank, and it's especially the cyclical cycle that appears to have happened here.

My point is not that I want a free-for-all for customers, but neither is it for the banks. There needs to be a balance, based broadly on something fair to both sides.

Y....

The rules only became unreasonable to the OP when he broke them. How about you go to the bank and they can't let you have any of your money because everyone and his mother thinks an overdraft is fine? You'd pop a blood vessel.

Again, not what I've been saying, and either you know that or aren't reading me properly.

For the record, I do not agree with letting customers just go overdrawn without penalty. I also am of the opinion that many of the people that used the threat of legal action against banks to get refunds for charges were taking the pee. If you've goofed, and gone overdrawn by a trivial amount, it wouldn't hurt the banks to waive the fee, but if they want to charge something resembling their costs plus interest, that's okay with me, and it's okay with the OP.

But essential in that above paragraph, to me, is the word "goofed". It implies, to me, both that it was a mistake, and that it is not a matter of habit. If the OP did this again and again, month-in, month-out, I'd have little or no sympathy. And a lot of people reclaiming thousands of pounds from banks were doing exactly that, and I did not agree with it. I also am not surprised that eventually the banks dug their heels in and fought, and as it happens, albeit on a very narrow technical point, won. That's fine with me. People were taking the pee, and the scale and nature of many of those refund claims were, in my view, an abuse an close to the use of the threat of legal action to extort money from banks.

So once again, I have no problem with the banks making a charge if you go overdrawn. Waving it for a customer that goes over by a relatively small amount, very occasionally would be a nice goodwill gesture, but it ought to be just that ... a goodwill gesture at the bank's discretion, and certainly not a right.

What I don't think is right is the extent of the charges the OP got clobbered with, assuming it's an occasional or better yet, one-off event, given the nature of the overdraft in the first place.

So it comes down to not just whether the bank has rules, but to :-

- are the rules right, as in fair and moral?
- are they legal?

On the first, in my opinion, no they aren't. A charge, yes, but not £360 for going less than £10 overdrawn.

On the second, the jury is out. Despite the Supreme Court ruling, there are grounds for arguing that such charges are both unfair and illegal. It just won't be on the grounds that the Supreme Court ruled on in that test case. That is now a dead duck. But there are other grounds, albeit most more suited to individual claims than a regulator test case.

Whether they will stand up to scrutiny or not depends on either the Ombudsman ruling in a given case, or a court decision, assuming they are challenged in either arena. And that, we don't know until the OPs makes such a challenge and we find out what happens when/if he does.


No free-for-all for irresponsible customers to abuse overdrafts, but no free-for-all for banks to make excessive profits from a simple, small and rare mistake either. Balance, and fairness, that's what I'm advocating.

[santa claus]

Balance, and fairness, that's what I'm advocating.

Well, we seem to be advocating the same thing, with differing views as to how it can be achieved. However, I don't accept that I have offered:

....the worst advice of the week.

[Saracen]

Well, we seem to be advocating the same thing, with differing views as to how it can be achieved. ....

I think, from what I understand of what you've said, that we disagree on what's fair and what isn't, yes. And I think we have much ground in common, yes, such as about personal responsibility. But as I read him, we have that in common with Robscure too. He agrees with that, and with reasonable charges and expects to pay some, despite it being an innocent mistake. Were I him, and were my account normally kept in good order and this was a simple mistake, I'd feel a goodwill gesture by the bank a decent thing to do, but not a right to demand. After all, I'd have goofed by going overdrawn, however accidental. What would wind me up, were it me, was the scale of the charges and the way they appear to have accumulated.

I guess the golden rules of this, for Robscure or anyone else reading this are :-

1) Don't go overdrawn, even by accident and by a small amount.
2) And this one's critical ..... monitor your account regularly
3) If you do go overdrawn, talk to the bank and make sure you've paid in enough. Do not, ever, assume you have. And remember rule 2).

Well, we seem to be advocating the same thing, with differing views as to how it can be achieved. However, I don't accept that I have offered .... <worst advice of the week>

I was playing off Zak's comment, and maybe worst of week overstates it. Still, pretty dire, IMHO, if for no other reason than it implies an assumption or two. Specifically, from :-

My advice is to put this behind you. ..... Taking them on for a few hundred quid is not worth it.

And you can do without the stress.

Implied are :-

- the value to the OP of "a few hundred quid"
- the impact of stress.

The "few hundred quid" will, to some, be an irritant and a dent in spare cash reserves. For others, it'll mean they can't pay the rent/mortgage, or their bills .... or don't eat next month.

So the "stress" aspect depends, very much, on Robscure's situation. Far be it from me to expect him to comment on that, but it seems plausible that if his current account drops that low, that spare funds is not something available in abundance. If spare funds were available, I guess he wouldn't have got into this mess in the first place.

There are a lot of people, especially in the last couple of years, living sufficiently close to hand-to-mouth that "a few hundred quid" in charges is a flaming great source of stress in the first place, especially if your monthly income and outgoings are so close together that you might never be able to recoup sufficient funds to clear those charges, so every month, you drop back under zero balance and get yet more charges, because of the unexpected and unanticipated absence of "several hundred quid".

What I'm getting at is that if your finances are sound, then your advice to ignore that several hundred quid because it's not worth the stress might be sound, but for lots of people, several hundred quid loss is utterly devastating. For someone barely managing on the dole and unable to get a job, for students building up whopping debt levels without banks charging excessive charges, that advice could very well be the worst advice of the week .... or the year.

It ALL depends on Robscure's personal situation, and were I him, that's not something I'd be discussing on a public forum.

Far better advice than just writing off a few hundred quid and not stressing about it is advice as to what his options might be, together with comment on the chances of success and/or downside, and leave it to him to decide on stress levels and what's worth what.

And in that context, one more thing I'd recommend, and I'm not sure if I said it earlier. If it happened to me, I'd do whatever it took (short of rioting and ripping of a new TV, etc) to get the account back in the black, ASAP. If that meant moving money in, and/or living on beans on toast for a fortnight, so be it. But stopping the charges accruing any further, by any legal means, is priority one. Getting money back, if you can, is a poor second to that.

[santa claus]

If it happened to me, I'd do whatever it took (short of rioting and ripping of a new TV, etc) to get the account back in the black, ASAP. If that meant moving money in, and/or living on beans on toast for a fortnight, so be it. But stopping the charges accruing any further, by any legal means, is priority one. Getting money back, if you can, is a poor second to that.

You got there in the end .

And is the definition of someone who is skint a fancy rig and 20 mb connection these days? I think not. I hope that if Rob takes the best advice of the year (yours, apparently, IYHO) it doesn't end up costing him more than he owes already.

[peterb]

I don't think the OP ever denied that he was in the 'wrong' by going overdrawn without authorisation, but he does feel that being charged for going deeper into debt because of the penalty charge is a little unfair, particularly as he remedied the situaton as soon as he discovered it. (And I can see his point)

As for it costing hime more by disputing it - well, it may cost him the postage, but if he reclaims part of the charge for the cost of a couple of first class stamps, that would seem to be to be a worthwhile activity and a good return on his investment.

But as others have said, a reasoned and logical explanation of the facts to the bank is more likely achieve to achieve a positive result than the emotional approach of "the bank stole my money" - which (IIRC - and I do!) is pretty much what I advocated in the second or third post in the thread!

[santa claus]

I don't think the OP ever denied that he was in the 'wrong' by going overdrawn without authorisation, but he does feel that being charged for going deeper into debt because of the penalty charge is a little unfair, particularly as he remedied the situaton as soon as he discovered it. (And I can see his point).

Well, rules are rules.

As for it costing hime more by disputing it - well, it may cost him the postage, but if he reclaims part of the charge for the cost of a couple of first class stamps, that would seem to be to be a worthwhile activity and a good return on his investment.

My mistake then. I thought he hadn't paid up and could therefore be accruing more debt.

I have no intention of giving £300 to a company as corrupt, unethical, and discriminatory as Lloyds TSB

But as others have said, a reasoned and logical explanation of the facts to the bank is more likely achieve to achieve a positive result than the emotional approach of "the bank stole my money" - which (IIRC - and I do!) is pretty much what I advocated in the second or third post in the thread!

Yes, we all agree on that. But it is wholly right that Saracen should produce a few biblically styled and exhaustive posts before we all say we are agreed on that. It just wouldn't feel right otherwise .

[Robscure]

You got there in the end .

And is the definition of someone who is skint a fancy rig and 20 mb connection these days? I think not. I hope that if Rob takes the best advice of the year (yours, apparently, IYHO) it doesn't end up costing him more than he owes already.

Wow this thread sure did take a sharp turn in political intrigue and popularity.

Well I think I've read everything (almost) that everyone wrote. From santa claus, I keep getting the impression of a crudely judgmental attitude. It's quite rude of you to assume my financial standings or any other personal details in this fashion.

Not that I owe you any explanation, but out of my distaste for your comments, I feel virtually compelled to rant. I've been out of work for a long time, struggling with my wife to find work and make ends meet, food and bills draw all of our income, I haven't paid into any hobby or luxury in several years. I built this computer in 2009 after I received a rather large pay check and wanted to spoil myself to the one material object that I'd always dreamed of since I was a kid, a proper computer that I could rely on for gaming. I'd never had such a luxury because I grew up in a very poor household. I'm sorry to burst your bubble, but not everyone is rich, or even moderately well-off, but some people are born into low-income families and have done hard labour since they were a young teenager in order to help make ends meet. I think you should change your tone for the future, because being judgmental in that manner is very unwelcomed. But for whatever good intentions you may have had, thank you anyways.

[santa claus]

Wow this thread sure did take a sharp turn in political intrigue and popularity.

Well I think I've read everything (almost) that everyone wrote. From santa claus, I keep getting the impression of a crudely judgmental attitude. It's quite rude of you to assume my financial standings or any other personal details in this fashion.

Not that I owe you any explanation, but out of my distaste for your comments, I feel virtually compelled to rant. I've been out of work for a long time, struggling with my wife to find work and make ends meet, food and bills draw all of our income, I haven't paid into any hobby or luxury in several years. I built this computer in 2009 after I received a rather large pay check and wanted to spoil myself to the one material object that I'd always dreamed of since I was a kid, a proper computer that I could rely on for gaming. I'd never had such a luxury because I grew up in a very poor household. I'm sorry to burst your bubble, but not everyone is rich, or even moderately well-off, but some people are born into low-income families and have done hard labour since they were a young teenager in order to help make ends meet. I think you should change your tone for the future, because being judgmental in that manner is very unwelcomed. But for whatever good intentions you may have had, thank you anyways.

Everything I have said in this thread is well-intentioned. You may yet come to see that.

Oh and please don't be judgemental about my circumstances. You have no idea.

My tone won't be changing, if it's too much for you I suggest you put me on your ignore list and save yourself the angst of listening to opinion that might be different to your own.

[aidanjt]

£360 fee for slightly dipping past the overdraft? At least Dick Turpin wore a mask.

[santa claus]

£360 fee for slightly dipping past the overdraft? At least Dick Turpin wore a mask.

If he had a mask on, howd'ya know it was Dick Turpin ?

[aidanjt]

If he had a mask on, howd'ya know it was Dick Turpin ?

Funneh.

[razer121]

Not to dig a llyods but i was once with them, i went overdrawn by 86p (yes i have all details thought i would dig it up before posting!) this was down to paypal taking money even after i canceled the direct debit, paypal set up the direct debit to take a payment for ebay, i couldnt afford it so canceled it. paypal set it back up

Anyway lloyds decided to charge me £30 plus £5 for going overdrawn.

Id already corrected the error the very same day. Still they charged me and of course it put me back in the red and then they added anouther charge for going back into the red. This brought it all up to £65.

I refused to pay it and moved banks, which is what id suggest to you. before anyone says im wrong bla bla bla i dont care, im pretty sure lloyds is wrong for what they did and believe this is exactly what they are doing to you.

hsbc are good mind ive going over by pennys, corrected it the same day and never been charged

[roachcoach]

That's odd, since the link I posted says you have until 1530 same day to correct things like that gratis. Was it a while ago? Also - why did you not invoke the direct debit guarantee? It is precisely things this like that it exists for.

____________________________________________________________________________

I digress, and to flog my dead equine buddy again...more details are needed to give substantive advice/assistance. From what I've read both here and on their site, is appears they are outside their guidelines, but I could not say for certain as all information is not present. But if they are outside their own guidelines, you have a much stronger case, if not you're going to be relying on manager good will.

Their own charges booklet previously linked states that:

A payment from your account you into an Unplanned Overdraft by £10 or less

You use an Unplanned Overdraft for one day during the month

For Classic Account,Added Value Accounts, Student and Graduate Accounts the charge for the quote above is NILL.




For clarity I do not work in a bank or indeed in that sector, just trying to look at this objectively and the account here and the website details do not mesh. It is perfectly possible the bank made a SNAFU, easily done I expect.

OP, only you will know and I'd have a thorough read to see if they are in error and otherwise it is, I am afraid, cap in hand grovel time. It works a lot better than going in angry.

[santa claus]

I refused to pay it and moved banks, which is what id suggest to you.

You can sorta see why banks have rules *sigh*. What will you do when you run out of banks to run away from?

I digress, and to flog my dead equine buddy again...more details are needed to give substantive advice/assistance.

Look, you ain't gettin' no more info. The facts shouldn't be allowed to get in the way of a good ol' sob story .

[TheAnimus]

You can sorta see why banks have rules *sigh*. What will you do when you run out of banks to run away from?

Or if he ever wants cheap credit....

Its funny this because I do think the fees are outragous, but I think OP went about dealing with the issue incorrectly, rather than pointing out plenty of coraspondance could have been lost due to moving etc, he took his eye of the ball due to everything going on and if they could arrange a better penalty system as this is a first offence....

But the crux of the matter is a personal responsibility issue imho. And the odd thing is, you appear to be agreeing with me on that. Which is odd because I had you penned as one of those head in clouds lefty types, who don't ever worry about the effects of balancing the equation.

If you take credit, its your responsibility. Myself I never use my overdraft except in emergencies, and no wanting a new TV is not an emergency, neither is wanting expensive food or drink.... That way I've got a comfortable safety net, of twice my monthly bills, so that if something happens I'd forgotten about (such as having to pay my sisters rent) i'm charged a few pence, if anything.

The danger comes when people treat an overdraft as an every day occurance, its simply not ment to be, and I think banks have been very irresponsible in how they market them as that.