cancelled overdraft without warning

[dissonantdreams]

Hi,

 

I'm posting this on behalf of a friend who has been having some really quite bad problems with NatWest... would anybody be able to advise me for her please?

 

She had a £560 student overdraft (which she was already in the process of paying off) and NatWest cancelled it altogether without any warning, back in 2005. She had extenuating circumstances at the time, which NatWest were aware of but didn't take into account. They also charged her for interest on this overdraft, which she shouldn't have had to pay as she was a student at the time. NatWest ordered her to pay back the £560, plus two £30 default charges arising from the fact the overdraft had been cancelled without warning, and the overdraft interest, and she has been paying this back at a rate of £25 per month. She has been told she has been blacklisted and will not be able to open another bank account - NatWest closed her account and she has no bank account at the moment. Even though she is paying back this money, she has been receiving letters from debt collection agencies, and when she has phoned NatWest to enquire, they have admitted they have made errors and not entered her payments into their system. It really sounds like they're bullying her quite badly and I think she should be entitled to some, or all, of this money back (at the very least, the overdraft interest, which they had no right to take from her account) - can anyone advise what to do? Any help would be appreciated because I think this is, understandably, getting her down somewhat?

 

Thanks in advance

[hedgey06]

According to the CRA's, there's no such thing as being blacklisted at all. However, if your friend has two defaults against her name, this would give her a very poor credit rating and she'd struggle to get credit/finance/anything more than basic banking facilities.

 

If she doesn't have an account at the moment - I'd advise her to open a basic bank account with one of the high street lenders (Nationwide are quite good with people who have poor credit histories). She'd probably only be offered a basic cash account with a cashcard (no direct debts, standing orders, switch card, cheque book or overdraft facilities) but at least she'd have an account to pay any salaries into.

 

With regards to them taking the overdraft interest from her account - does your friend still have her old bank statements and a copy of the original account agreement and terms and conditions? If she does, I'd be inclined to suggest that she write to Nat West informing them that the interest was applied to her old account when it shouldn't have been and that it clearly breaches the terms and conditions that she signed up to. And thanks to them calling in the overdraft for no reason she's incurred defaults against her name and possibly other charges. How charming of them. If she doesn't have the original agreement, she needs to request it.

 

I'm going to ask for further advice for you on your post - it's quite complex and it seems as though Nat West have made some quite serious errors in the way they've treated your friend.

 

I've also asked for further advice on your post and unfortunately, overdrafts are payable on emand and the banks usually have trigger points before they start to recall a debt (e.g., not paying a loan, etc).

 

And on a final note - she can (of course) reclaim any charges back from Nat West. If she doesn't have the statements - she'll need to send a S.A.R - (Subject Access Request) off.

[dissonantdreams]

Thank you so much Hedgey, I'm sure she will appreciate that. I will pass what you've said on to her.

 

With regards to the overdraft being payable on demand; surely they would actually have to demand it, though? The first she knew of it was when she went to a cash machine to withdraw some money and was refused; she walked straight into the branch to see why, and that was when they told her they'd taken the overdraft back. I am not sure of their exact reasons for doing so, but she did let them know that she was having financial difficulties at the time and they refused to enter into any dialogue with her. I'm with HSBC and whenever I've been having trouble, I've always been able to go into the branch and talk to them about it. I know all banks are slightly different on these things though.

 

I'll let her know about reclaiming the charges as well; she is aware of the test case but we can always start the process and see what happens.

[hedgey06]

As far as I'm aware, you're supposed to receive written notification (I think it's 28 days but don't quote me!) that they're recalling your overdraft. When your friend sends her SAR off, tell her to make sure that she's clear that she wants all information related to her account - including any letter that they've supposedly sent recalling the overdraft.

[jkspepper]

I am browsing the forums for some help on on overdraft defaults and am surprised to see this as it is exactly what has happened to me.. to the letter!

 

I was a student with a student account at Natwest in which they unexpectedly (to me) cancelled my account citing inactivity as a reason. I wasn't in financial difficulty but still as a student, I agreed to pay them back over a set term... which I have and is settled... early as well.

 

It wasn't until recently, after looking at my credit status that I found out Natwest had issued a default on my account. No notice of the default was given or even mentioned at all before!

 

I would be interested in finding out how you are getting on with this.