Halifax Overdraft - Changes to Accounts £1 a day

[sigsoldboy]

Sorry if this thread is elsewhere but I have just come home to a lovely letter for Halifax telling me how they are going to extrort more money from me.

 

Apparently from the 6th December Halifax will now charge £1 a day for every day we are overdawn, by my calculation I will now pay double the amount I did before. I payed about £18 a month in total in interest. Now I think I will be nearer to £41.00.

 

Halifax offerd me the OD when times were better and I had a better paid job, to provide a comfort zone I accepted, but I then lost my job last summer and I now earn much less and struggle to pay my credit card, now my interest is double !!

 

Is there any Bank / Building Society people can recommend, any way to get away from this horrible horrible bank?

 

(p.s. When complaining in a branch recently about a charge that should never have been the teller said there was no point complaining, 'Nobody cares'. Please god let there be a half decent bank out there)

[BankFodder]

There are no decent banks. They are greedy and bullying and some are dishonest if they need to be.

If you mnove to another bank - don't close your Halifax account if it doesn't cost you do keep it open. Uk bank accounts are useful to have. Also, you are more of a thorn to them with an open account which you don't particularly use

[sigsoldboy]

Thanks for the advice do you know if any other Banks are planning to go the same route, it actually makes sense for the banks to make a mint this way, again from the poorer elements of society.

 

I dont want to change bank to find them all following suit but if one does usually all follow. The way of the Cabal.

[the_freedom_trail]

Sorry, just out of interest, you are telling me that they are going to charge you £1 a day for just an arranged overdraft, not an unarranged overdraft?

 

TFT

[sigsoldboy]

yep, £1 a day for every time post 12pm I have an arranged overdraft facility in use. £5 a day for unarranged.

[Pook_Pook]

My housemate had a letter from the Halifax this week saying they would be changing to this new £1 a day charge, I have the same type of account as him also from the Halifax so I was rather worried.

 

I went into my local branch to enquire if this change would also effect me, sadly they confirmed it would as it will apply to all current accounts.

 

I'm currently waiting for an ESA (Employment Support Allowance) claim to be processed & so for the last month I have had no income at all, over the last five years I have bounced between JSA and Incapacity Benefit when ever they decided I was "fit for work".

 

I have a £850 overdraft with the bank and have been more or less at the limit for the last 5 years, this has been costing me about £8-9 a month. A £1 a day is a massive difference to me & I can't think of any way out of it.

 

I spoke to a very nice lady in the bank and she did really seem to be trying to help, but sadly she couldn't come up with anything either.

 

Does anyone have any suggestions?

[Bookworm]

Yep.

 

Change banks.

 

Then divert all your income etc to the new bank. Tell Halifax in writing that you do not accept those new T&Cs and will no longer be using the account, but can not afford to pay off your o/d before closing it, and ask that they keep on running it under current T&Cs whilst you pay it off, the way credit cards have been doing.

 

I'd also report them to the OFT, the more people do that the better, as if that's not unfair terms, I don't know what is! I feel this comes squarely within the CPUT Regs and should be reported to the OFT as such, IMO.

[yid33]

I recieved the new terms and conditions for my halifax account today and I was wondering about the legality of these charges?

As its a charge and not intrest

[coolchris]

Hi. Did not notice this thread until it was too late, as I opened one here:

http://www.consumeractiongroup.co.uk/forum/general-debt-issues/226052-new-halifax-overdraft-fees.html

 

Yer. I am gonna get stung with £30 per month as I cannot afford to pay the £1000 overdraft back. Like you, it was given to me when I was working. Now I am a Carer and only getting Carers allowance and Income support, so no way I can pay a grand back. I am gonna write a letter of complaint and see what they come up with. I wanna pay it back as best I can per month..like a sort of loan...but taking out a normal loan on benefits is deffo out of the question.

[leon_heller]

As I read it, they won't be making those charges of £30 or so when there are insufficient funds in the account. They are presumably doing this as they think they are going to lose the appeal over those charges.

 

Leon

[the_freedom_trail]

yep, £1 a day for every time post 12pm I have an arranged overdraft facility in use. £5 a day for unarranged.

 

So basically, the bank have backed you in to a corner and now they are trying to exploit that situation. If you or I involved ourself in such practice I'm sure be would be arrested.

 

I hope you don't mind me asking, what type of current account is it - I just wondered because I have a Halifax account, albeit with a modest £150.00 overdraft - just want to make sure that I don't get stung. Mine is a standard visa debit account - nothing fancy like breakdown insurance or any of that nonsense.

 

TFT

[hallowitch]

it looks like i could be in same situation i have 2 current accounts with the Halifax both overdrawn

i cant recall getting a letter from them telling me of the £1 a day charge

can anyone tell me when these charges start from

 

how do i complain to the OFT and what would i write i wouldn't know where to start trying to write a letter like this

is it possible for template letters to be written and posted up 1 for the Halifax and 1 for the OFT i think there will be loads more people looking for help with this

[the_freedom_trail]

This is Halifax throwing their rattle out of the pram. What they are basically saying is we can't get you with bank charges as they are so now we have come up with another way of screwing you. I will certainly complain to the OFT.

 

I agree, it would be good if we could get a template letter together so that we are all singing of the same hymn sheet then bombard Halifax and the OFT with as many as possible.

 

I think there might be quite a few parachute accounts that need to be set up.

 

TFT

[cupcake65]

I too have received this disgusting and obscene charges letter. I rely on my overdraft and was paying about £9.00 a month in interest charges it will now be £31/31 a month. I have a small amount of savings should I use this to pay off the overdraft? As I rely on benefits I am not sure if I will be able to cover my outgoings without an overdraft. Is this how the Halifax will pay the bonuses next year? How can they get away with this as again it is the low paid/on benefits people who will suffer. Also please could someone tell me what a parachute account is (the -freedom-trail post) and (leon-heller what did you mean in your post) i am rather new at this and do not understand some of the details in the posts

Edited October 15, 2009 by cupcake65
needed to add something else for clarification

[the_freedom_trail]

Hello cupcake65,

A parachute account is a separate bank account with a completely different provider - i.e. a bank completely un-associated with the bank that you currently have your main account with.

You may not know this but a bank has a right to offset which means that if you default on a debt/borrowing on one of your accounts, they can use another account with a surplus (i.e. your savings) to make good that default. This is why you must make sure that your savings are not with Halifax. I don't mean to scare or panic you but believe in letting you know the potential risks so that you may address them before any issues arise.

You can set up a parachute account generally irrespective of your credit record and financial circumstances. Co-op is often cited for the cash card account they provide - I believe this account is not credit scored. Also, I will make clear; a parachute account is a generic term rather than a particular type of account.

With regards to leon_heller's post, he is referring to the current bank charges test case which is now awaiting a verdict in the Supreme Court (formerly the House of Lords). It is thought that the banks will lose the case that bank charges cannot be assessed for fairness under the UTCCR (Unfair Terms in Consumer Contracts Regulations) which will allow the OFT (Office of Fair Trading) to rule on the fairness of the current charges. Ultimately, this all means that banks have had to come up with another charging structure that cannot be legally challenged like the current charges - hence the new per day charging structures we are seeing.

Finally, be very careful with the bank that you choose for your parachute account. No doubt you will be aware that there has been much consolidation in the banking industry within recent time which now means many different banks are now ultimately owned by the same company. For example, Lloyds Banking Group now own Lloyds TSB, Halifax, Bank of Scotland, Birmingham Midshires, Scottish Widows, etc, etc.

Your question of how can they get away with it is one on the lips of many people. Personally, I am disheartened but not surprised by the banks changes to their charging structures.

I hope that this information may be of benefit to you.[/font]

Regards,

 

TFT

[Bookworm]

it looks like i could be in same situation i have 2 current accounts with the Halifax both overdrawn

i cant recall getting a letter from them telling me of the £1 a day charge

can anyone tell me when these charges start from

December 1st.

 

how do i complain to the OFT and what would i write i wouldn't know where to start trying to write a letter like this

is it possible for template letters to be written and posted up 1 for the Halifax and 1 for the OFT i think there will be loads more people looking for help with this

I'll work on that over the rest of the week and post them up.

[coolchris]

December 1st.

 

I'll work on that over the rest of the week and post them up.

 

Many Thanks. I can see this getting as much, if not more, publicity as the unfair charges did. It is ALWAYS the ones that have the least get stung the most. The world is upside down, run by liars and thieves. As I get older I become more aware of just what these greedy bstrds are doing to us all...slavery through debt basically.

[chloecat]

Aggghhhhhhhhhhh not been on here in ages. But I too have just returned home to this lovely letter and without wanting to lower the tone here but WTF!!!

How on earth can they get away with this? I ran away from Barclays to the seemingly warm open arms of the Halifax and then BANG. It must be illegal somehow surely?? It is an ARRANGED overdraft

 

Also they say ' from 6th December 2009 we'll no longer be paying the 0.1% AER/Gross Credit interest we pay you on the balance in your account, or charging you debit interest on any overdraft you use... blah blah blah

 

My point is...we'll no longer be paying the 0.1% AER/Gross Credit interest we pay you on the balance in your account Does this mean they WILL pay me £1 per day everyday my balance is in CREDIT?? I dont think so!

 

Grrrr Winkers! Replace the letter 'i' with any letter you see fit.

 

If you produce a template letter for the OFT I will duly sign and send it off.

 

I am seriously beginning to wonder (possibly a bit too hopefully) that it is looking more and more like the banks will lose the test case and they are desperately trying to shore up their funds in advance.

Edited October 15, 2009 by chloecat
I was so angry I couldnt spell

[hallowitch]

December 1st.

 

I'll work on that over the rest of the week and post them up.

 

 

thanks bookworm very much appreciated

[cupcake65]

Thank you freedom_ trail, that worries me even more as my pitiful savings are in the Halifax I also have a Halifax1 credit card. I am thinking of paying off the overdraft and just putting enough money in to cover my direct debits and keeping the rest under my mattress!! or if there is anything left Premium Bonds At 65 I feel that I have been kicked in the teeth I have been a Halifax customer for over 40 years and NOW Halifax are putting the boot in. They arranged this overdraft I didn't ask for it. Ok I agreed to it but on the terms at the time I could manage ,now it is impossible.They even lost me all my money on my free shares. Now it means that my family will get lumbered with my funeral costs instead of me being able to cover them myself. I get the impression that if you have plenty of money the banks will look after you if you don't TOUGH T...Y

[hallowitch]

Ive been a Halifax costumer for 35 yrs and i am seriously considering getting a small loan to pay of my overdraft i will then transfer the the balance on my credit card and will move my accounts elsewhere

 

i have always dealt with the Halifax for all all my finances bank loans credit cards mortgage

thankfully i have never had any charges from them and have never missed a payment for anything but do live on both my overdrafts

well no more Halifax for me

[coolchris]

To be honest I think all the banks are gonna go this way. Its sort of saying .."well..you asked for it..now have it", in regards to the court case on unfair charges. If the greedy gits cant get their profits one way, they will try all the tricks in the lawyers' book to get it another...and they certainly have come up with a right teeth-kicker. I seriously despise everything the banks stand for.

 

The more people we get together on this, the better. I wanna see if the OFT actually thinks that this is FAIR. To be honest I think this should be means-tested, based on your income, not a flat rate for millionaires and paupers alike. Totally disgusting.

[sigsoldboy]

It would be great if anybody could get a OFT template ready. It is true that as they are replacing it with a staning charge and not interest what is the legality of this ?

 

Also this starts from the 6th Decmeber, that is less than two months notice what is the legality of that.

 

The best Idea I have heard is the idea of closing the account at the existing T&C's ? Can you do this and how ?

 

Also has anybody else heard any details about other banks heading the same as yes there are really only 6 banks left.

 

If the Bank actually paid me back the charges they owe me I would actually give it straight back to them to pay of my overdraft.

 

Moments like these I think of Goldman Sachs, enough of a bonus pool to pay all thier staff globally £315,000 each. Sorry off topic but Im v.frustrated.

[Endgame]

If anyone hasn't broken down how the £1 'fee' equates to annual interest, here are a few illustrations based on authorized overdrafts:

 

£0.01 Overdraft: 3,650,000%

£100 Overdraft: 365%

£100 Overdraft: 73%

£500 Overdraft: 36.5%

 

This is an outrage. These rates are many times greater than unauthorised rates in many cases. My fear is that the other banks will follow this lead, unless Halifax customers make a collective stand. Here's what I think we should all do, and I've done this already:

 

1. If you are in a position to do so, switch bank. You'd be hard pressed to find a worse deal.

2. Complain to Halifax.

3. Report this to the OFT.

4. Contact press and media financial correspondents and get them to tak an interest in this case (look of the BBC Watchdog feature next week)

5. Notify some of the bank's major shareholders, i.e. the government.

 

The more stink that can be caused, the less likely other banks are to follow suit. The biggest single measure that can be taken is to get out of the Halifax, and as soon as possible- let's see what that can do to their bottom line. This is surely a bigger scandal than unauthorized overdraft charges, and they affect ALL customers regardless of credit profile and income, but will serve to impact those on lower incomes far more severely.

[funkyparott]

I've just had this letter.

 

We told them last night we were looking to move all our accounts mortgage etc to another lender. To be honest, the person on the other end of the line couldn't care less. We've been with them 10 years plus.

 

I do feel sorry for the call centre staff, they must be taking a lot of pressure at the moment and I realise its not their fault.

 

I don't know who to transfer to. I have a nasty feeling all the banks will follow suite.

 

I just can't believe they can get away with this. The arragonce of banks amazes me.

 

Has anyone read the pamplet that came with the letter? In particular, the section 'why are we doing this'. I can't quote verbatim as I'm at work. It was along the lines of getting rid of complicated charge structures and making charges more 'transperent' for their customers.

 

What a load of old.......