Can banks legally charge for going overdrawn?

Keep hearing rumours they can't.

I was £500 overdrawn this month(thanks bfc), and barclays have charged me £30 for it.

 

I'd look on the website that deals with this issue.

I am sure they can only charge you an admin fee.

 

Yes but ...

... the charge has to be resonable (i.e cover their costs) and not be to generate profit.

Have a read here http://www.thisismoney.co.uk/bankcharges

My bank (Abbey) tried to charge me 150 quid for going 26 quid overdrawn this month ... 30 per card transaction even though 2 of them were for only 86p each, I chalenged them and got it all refunded.

 

Cheers

Surely it shouldn't be £30 though.

As if charging me £30 helps resolve the issue of me going overdrawn anyway. (banghead)

 

Look at Martin Lewis site "The Money Saving expert"

He's adament it's illegal. You can download a template letter to send to your bank - thousands have done it and got refunds because the banks don't want to pursue it.

 

If you are in breach of the conditions of the account nt

 

RE: Look at Martin Lewis site "The Money Saving expert"

My boss has done it and I'm going through the process. NatWest and Halifax have both tried to charge me recently and I've asked them to reconsider, they dropped charges on both occassions (saving me about £300).

 

they are allowed to cover the costs of going overdrawn, including interest etc etc - but once it starts being a penalty charge, it becomes illegal. the charges for going overdrawn have generally gone down to about £11 now.

its right that the banks don't want to have the matter taken to court because if their charges are challenged they would have to reveal the internal operations and costings of each stage of the process, and obviously, the dont want to do this.

 

This bloke will get them back for you

David Kay
DK Financial Services
10 Fairburn Grove
Elsecar S74 8BB

iwantmychargesback@yahoo.co.uk

He'll do all the legwork for you and take 30% of the charges you get back. He's just got £1700 back for a bloke at work.

 

Link here how to get it back

http://www.moneysavingexpert.com/cgi-bin/viewnews.cgi?newsid1141050760,24632

 

They can charge a fixed payment at first for bing overdrawn. If you still don't pay up, they stick a recentage charge on. So, if they charged you £20 at first they could charge you £2 extra as a 10% increase, therfore you have paid £22. if you still don't pay it, they'll charge u a further 10%, in this case being £2.20, therefore you have paid £24.20. Then you get chargded a percebt of that.......so on......and so forth.

 

Try this one....

<a href="http://www.bankcharges.org">

Bank Charges.org </a>

25% inc VAT if you dont want to do it yourself - and its a lot more painful than they would have you believe!

 

RE: Try this one....

I've only had to send two letters, my boss just sent the one.

 

not really..it can still be deemed a penalty charge

under UCTA and the consumer contract regulations 1999.

so far the banks have failed to put forward an adequte defence, if a defence at all (because its fairly clear that these clauses are penalty clauses and unreasonable).

The risk is that the bank can close your account if you try and reclaim your charges which can leave you in a predicament where you owe the bank for your overdraft for example.

 

A girl at work just got over a grand back using the Martin Lewis template letters.

 

Hope they do? I sent mine of a few weeks ago .(Martin lewis template letter) we'll see .... (dunno) ....

ffs i hope so'' Our lass is planning a holiday with what the robbing buggers probably owe us? .... (seestars)

 

hahaha you sound like ou deserve the fines!!! Consistently breaching overdraft limit tut tut. Some people are exemplary customers and still get treated like something you might step in!

 

I have to to support BFC! Bit **** really, but oh well. Still wouldn't mind getting my money back

 

you were lookin to get a loan aswell LD? You will be lucky!

 

I was a while ago, yeh. Not anymore though, might just win the lottery!