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Overdrafts - Are banks calling them in?

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mediah01

Free Member
Jan 31, 2008
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Leeds
Hi all
I was considering asking our bank for an increase in our overdraft. Then I thought that in the current climate I probably wouldn't have a chance of that happening. Then I started to panic that our bank could call in our overdraft at any time. Has anyone's bank called in their overdraft? What are the options if you don't have the money?
 
Your bank will only call in your overdraft if you are not showing money passing through the account or they feel its a risk to keep the overdraft etc.

Some banks will offer you alternative means ie loans to pay off the overdraft, but this is only usually done when they see that the overdraft is always at its limit.
 
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our bank (RBS / UK Government) guarantee the overdraft for 12 months at inception and renewal. They can't just call it in.
 
Last edited by a moderator:
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pixelnet said:
our bank (RBS / UK Government) guarantee the overdraft for 12 months at inception and renewal. They can't just call it in.
Click to expand...
happened to a client of ours who was with RBS gave them 30 days notices to find another account.
They stated it was a comercial decesion..:eek:
 
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A Natwest manager is trying to get usto move our business from Barclays, and the carrot is they offer a 12 months guaranteed overdraft that cannot be recalled *overnight* so not sure how accurate that is as we haven't budged yet.

The bank would always rather you have a loan than an overdraft as it will cost you more in the long run, and is less of a risk for them, I suppose it would depend on the relationship someone has with their bank or bank manager.
Julie
 
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I have 12 companies and 7 have had their overdrafts cut. 5 just got a letter on the same day saying company policy 25% off now and then 3 months later another 25%.
I have one company that never used their facility for the last 18 months and just had it cancelled, outright.
have two companies that have £200,000 monthly turnover and overdraft cut to £30k.
It is bloody mad out there. watch it and if you can arrange a loan that you may need. do it now.
 
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Moneyman said:
I have 12 companies and 7 have had their overdrafts cut. 5 just got a letter on the same day saying company policy 25% off now and then 3 months later another 25%.
I have one company that never used their facility for the last 18 months and just had it cancelled, outright.
have two companies that have £200,000 monthly turnover and overdraft cut to £30k.
It is bloody mad out there. watch it and if you can arrange a loan that you may need. do it now.
Click to expand...
That sounds pretty scary.
 
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It does depend entirely on what sector and what part of the country. i have had problems in scotland only to find norfolk very easy and visa versa. Some central office bloke will just make a decision for that area and that's it.
 
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I had a REALLY nasty call from Halifax about my overdraft because I wasn't 'sending' money through the account. I explained my situation and am now making monthly payments to pay it off. They will get their short term goal - their overdraft paid back- but there is no way I will stay with them if that is the way they talk to customers. (Yes, even bad ones like me.)

RBS on the other hand have been ok. I do put all of my money through that account, but I am in sort of the middle stages of business - good money coming in, but trying to pay back start up costs, AND keep turning over. If they were to call in the overdraft now, I would probably have to declare bankruptcy, unless they could offer me a loan.

Hopefully they will see the increasing sales and give me the extra months I need to get back into the black.
 
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sparklyscotty said:
I had a REALLY nasty call from Halifax about my overdraft because I wasn't 'sending' money through the account. I explained my situation and am now making monthly payments to pay it off. They will get their short term goal - their overdraft paid back- but there is no way I will stay with them if that is the way they talk to customers. (Yes, even bad ones like me.)
Click to expand...

Don't take this the wrong way, but Halifax will probably be glad to get their money back and for you to close your account. That's perhaps why their attitude was as it was.
 
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I know of a doctors surgery (really high risk, consumer driven business, not) that had its facilities cut from an offered £250k last year, to £30k this year.

Now that makes no sense at all.
 
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My Bank and I have agreed a repayment plan for the next 12 months. Therefore, my overdraft is being reduced every 3 months. My bank manager advised me she was helping me reduce my charges and save me money or charges! To be honest with you a business with an overdraft is not really a stable business I have learned over the years.
If you can ovoid borrowing (even if it is against the government rules apparently borrowing stimulate the economy) do hesitate to do it and be fool with Loan offers will be stack with loan for a duration of the repayment with an overdraft you can repay it any time you have the money (may be win the lottery at some point or very nice stock investment which can earn you some nice pip)
 
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Clodbuster said:
Strange things are happening, we were offered an overdraft facility about 4 years ago when beginning trading. This has never been used even for £1.00 yet we got a letter recently withdrawing the facility. Natwest.
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It's something to do with the fact that the 250k of lending that has been offered to you cannot be offered to anyone else, but if you don't use it at all thats why they are taking it back, to be able to offer that amount to somebody else.

Julie
 
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mediah01 said:
Hi all
I was considering asking our bank for an increase in our overdraft. Then I thought that in the current climate I probably wouldn't have a chance of that happening. Then I started to panic that our bank could call in our overdraft at any time. Has anyone's bank called in their overdraft? What are the options if you don't have the money?
Click to expand...

I have 2 buisnesses both with HSBC, i wouldnt even highlight the fact your out there! they pulled in my smaller overdraft for the hell of it
 
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