Overdrafts

Managing your current account

Try to keep your account in credit at all times – being overdrawn will mean that you will normally pay interest charges

An overdraft is best used to help deal with unexpected payments rather than a way of borrowing money for long periods of time
Cheques paid into an account have to be ‘cleared’ before the money is available and can be spent – check your balance to make sure
Cash paid into an account at a branch using your debit card will be credited straightaway. If you do not have your debit card and complete a credit voucher, the credit will appear by close of business
Be aware of the timing of standing orders and direct debits on your account and make sure you have money in your account to cover these payments
You must have money in your account the day before a payment is due to avoid the possibility of not having enough money to cover the payment and potentially a service charge
If you do need extra money to cover unexpected payments then contact us to arrange a formal overdraft – if we agree to provide this facility it will last for a maximum of one year.
We also offer current accounts that have a free overdraft as standard – if you do not have one of these accounts why not contact us on 08457 212 212 to find out more?

What overdraft services are available?

An overdraft is simply a way of borrowing money for a short period of time, perhaps to pay an unexpected bill. You can request our overdraft services either formally or informally.

Formally – You can request our overdraft services in advance and if we agree to your request (by agreeing an overdraft limit, or an increase to an existing overdraft limit) we will tell you your overdraft limit and confirm the terms in writing. A formal overdraft lasts for 12 months and we will write to you towards the end of this period with information about what we may be prepared to offer you when your current overdraft expires. We will charge you £20 to set up or renew a formal overdraft.

Informally – If you have not formally requested our overdraft services as above, you may still request an overdraft by undertaking a payment or withdrawal from your account, even though no overdraft limit has been agreed or where the payment or withdrawal would cause you to exceed any agreed or standard overdraft limit. Please note that, depending on your circumstances, we may either accept or decline your request. We will charge you £20 for every informal overdraft request that is approved and £30 for an informal overdraft request that is declined and where the item is returned unpaid.

How will I know what charges have been incurred?

During each charging period, which runs from on or about the 5th of the first month to on or about the 4th of the following month, we keep a record of service charges for informal overdraft requests and unpaid items. This information is then added to the statement that we send you at the end of the charging period. The charges are then subsequently taken from your account on the date shown on your statement.

What will it cost?

Formal Overdrafts
If you decide that an overdraft is the best option for you, we would encourage you to request the overdraft formally as this is generally less expensive than an overdraft that is not agreed in advance. Where we agree to your request for a formal overdraft, the facility will be provided for up to 12 months and there will be an annual charge for this service of £20.

At the end of the 12 month period we will contact you and may offer you an overdraft for a further 12 month period. Any overdraft limit that we offer you will be based on your circumstances and may be lower or higher than your current overdraft limit. A charge of £20 will be charged for each 12 month period. These charges apply even if you do not use the overdraft. You may request a change to your overdraft limit at any time and if we agree there will be a service charge of £20 to make this change.

Informal Overdrafts
If you request an informal overdraft which we agree to provide there will be a charge for this service of £20 when you first go informally overdrawn. We operate on monthly charging periods (from on or about the 5th day of the month to on or about the 4th day of the following month) and if you make a further request for an informal overdraft in a charging period – i.e. your informal overdraft increases - there will be a further charge for this service of £20.

If you request an informal overdraft and we do not agree, we will refuse to make the payment you request by returning it and there will be a charge of £30 (or £19.50 for Cashminder accounts). Any subsequent requests for an informal overdraft may also be declined and the item returned unpaid and a charge will be applied for each item returned unpaid.

In addition to the overdraft service charges above, you will also be required to pay overdraft interest on the amount that you borrow dependent on the type of account that you hold. Please refer to your Account Charges Leaflet for further information.

Helping with Infrequent Charges
However carefully you manage your account you may occasionally go overdrawn when you hadn’t intended to, resulting in charges. We will automatically waive these charges when you request an informal overdraft, providing that:

you have maintained your account in credit (or within any agreed overdraft limits) for the previous 366 days, and
you return your account to credit (or inside an agreed overdraft limit) within 6 working days.

Putting an Upper Limit on Charges
We will limit your informal overdraft service charges and unpaid item charges to £150 per quarter. If we have provided you with any refunds during that quarter then this amount will increase by the amount of those refunds.

Is an overdraft the right option for me?

Our services are designed to meet short-term borrowing needs such as an unexpected bill. Where you have an ongoing or longer term borrowing need, another type of product, for example a personal loan or credit card, may be more suitable. Maintaining an overdrawn balance close to your overdraft limit may limit your ability to respond to unexpected bills or payments and you will incur interest charges on the amount you have borrowed. You should consider how you are going to repay an overdraft before making use of this facility. Some of our current accounts, such as Current Account Plus, have a fee free overdraft facility.

How do I apply for a formal overdraft?

You can apply for a formal overdraft by calling 08457 212 212 or at your local branch. We are available 24 hours each day, seven days a week. You can be assured that every request for our overdraft services is considered based upon an individual’s circumstances and in line with our responsible lending policies. We will provide you with a decision immediately in most cases.

Where can I obtain further information?

You can get further information by calling 08457 212 212. Our branches also offer a free financial review service and will be happy to discuss our full range of borrowing services including overdrafts.