this last month i have had a lot to spend out at a pretty bad time money wise. i went into the bank and set up a small overdraft just to cover my direct debits. a not to be spent back up .now a freind tells me if i go overdrawn it will affect my credit rating.is this true as i have arranged the overdraft with my bank.cheers..
going overdrawn with the bank.
- Thread starter stukacat
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Not if you stay within your arranged limit or if you do go outside your limit a lot of banks will not consider you for additional credit for thee months after the event. If you use your overdraft only go into it from time to time stay out of it as much as possible because the bank may take the view that you are having to live financially outside your own means if you stay permenantly in your overdraft.
But like I say using it will NOT affect your credit rating.
But like I say using it will NOT affect your credit rating.
A direct debit will overdraw you and charges will occur because of this, I'm not actually sure if you can get cash from an ATM over the value thats in your account though.
Not always. Some banks may have that in place but most banks don't. More than likely so that they can still charge you silly amounts of fees.
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Some banks, mine included allow you to go upto £10 over your limit without charges and others will refuse to pay a DD if it would take you 1p over. You would have to ask your bank but they may not tell you so you would not know until it happened. Best not to really, I only found out by mistake.
hitman are you saying that if a direct debit is due my bank will not let it be paid out of my overdraft or only if i have gone over my limmit.the overdraft covers my direct debits in size and it will only be used for these.i have cash coming in but i cannot be sure it will always be in to cover these out goings on time.the one that concerns me is for something i got on an intrest free deal and if i miss a payment it will cost a fortune.i should be on my feet again soon.
its a bank holiday and i have a direct debit due on tuseday.i have been going through my finances today.i have just had to tax mot and insure my car and get a new clutch fitted.that took a lot of cash.i had a job on for this weekend for cash but it fell through.i thought i was doing the best thing by getting a small overdraft just to see me over for a couple or weeks.then my mate mentioned it affecting my credit rating.and it all starts ticking in my head.
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Only if the DD would take you OUTSIDE your limit, if it is within your limit the bank will pay.
There are two kinds of overdraft - authorised and unauthorised. An authorised overdraft is just like having extra money in your account. For example, if you asked the bank for a £200 overdraft, then your available balance would show as £200 more than you have in the account. All available funds can be used in the same way, so direct debits etc will work as if you actually had that money.
An unauthorised overdraft occurs when you spend more money than you have AND more than the bank has allowed in the form of an authorised overdraft. There are some transactions which aren't checked by the bank and so can still go through when there aren't enough available funds. Unauthorised overdrafts are the kind which affect your credit rating, as you are borrowing more from the bank than you said you would.
An unauthorised overdraft occurs when you spend more money than you have AND more than the bank has allowed in the form of an authorised overdraft. There are some transactions which aren't checked by the bank and so can still go through when there aren't enough available funds. Unauthorised overdrafts are the kind which affect your credit rating, as you are borrowing more from the bank than you said you would.
Soldato
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I felt the pain when a DD came off which i thought came off my other account. £28 charge and a £35 charge at the end of that month:S I was confused when she tried to explain that one! Then had the cheak to offer me a credit card!!
thanks for all your help it lookes like i shall be ok from what you have all said.i
dont often run into things like this as i tend to try to live by my means but on this occasion i have been well caught out.thanks again for all your help i shall sleep better now...
dont often run into things like this as i tend to try to live by my means but on this occasion i have been well caught out.thanks again for all your help i shall sleep better now...
Going to hijack this thread
I have just had ANOTHER charge from Natwest for £28. Now I haven't gone over my agreed limit. Do you get charged if you don't pay it back within a month?
You get charged if you've gone over the limit at any point, regardless of how quickly you pay it off. You can then get charged if the initial charge takes you overdrawn. I had a problem a few months ago where a transaction went through when it shouldn't have and I ended up getting charged come statment time. I didn't realise I would be charged because I thought it would be a more instant response and I only use online banking so didn't even open the statement which had a letter about the charge. Since I didn't budget for the first charge, it took me overdrawn, which resulted in a second charge
. In the end, I called the bank who refunded it all because it wasn't my fault that the first transaction had gone through.Yeah but that's just it, I haven't gone over the limit.
But now I have been charged I have gone over my limit. I'm going to go in this week and ask them to reverse the charge. Otherwise I will have to close the account for my own sake so I don't keep using money I don't have. Think this is my 6th charge now because it was a constant cycle just as you said.
But now I have been charged I have gone over my limit. I'm going to go in this week and ask them to reverse the charge. Otherwise I will have to close the account for my own sake so I don't keep using money I don't have. Think this is my 6th charge now because it was a constant cycle just as you said.
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My bank lets me go over my limit, but it's not a cheap thing to do.