overdrafts

[stevec000]

can anyone clafify the difference for me off an ARRANGED overdraft and a UNARRANGED overdraft.
keep it simple for me pls because the baks dont
cheers

[RATTER15]

If you go overdrawn without an arrangement/permission with your bank then it is an unarranged overdraft.

[EvianBaby]

Someone is welcome to correct me but isn't the first an overdraft amount that is agreed pre-agreed by your bank. The second is when you exceed your agreed amount. You're likely to find that fairly costly.

[Kathyan]

With an arranged overdraft you don't pay charges for going overdrawn, only interest on the amount you go overdrawn. With an unarragned overdraft you will pay charges per day plus interest.

[LoftyLottie]

An unarranged overdraft is when you overdraw without having arranged an overdraft with the bank beforehand. Quite simple really.

There are charges (high) for unarranged overdrafts as well as interest. Arranged overdrafts you just pay the interest. An arranged overdraft with your bank will be capped at a certain amount according to what the bank and you decide is acceptable.

[RATTER15]

Many people have an arrangement with their bank to have funds available if they need to go into the red, this an arranged overdraft.

[stevec000]

so i have a £500 overdraft (arranged)? yet thet charge me £5 per day i am in it, is it fair to say the banks are trying to claw back some off their money after screwing up the country

[EvianBaby]

I'd speak to your bank. That doesn't sound right.

Maybe they removed/reduced your overdraft facility?

[LoftyLottie]

Strange Steve. If your overdraft was prearranged with the bank and you have not reached the £500, I cannot see why they are charging you (other than interest). Have you queried this with them?

[woofgang]

Yes, the only source who can answer your question is the bank. It will depend on the terms of your arranged overdraft as to what they an charge you but a fiver a day seems a bit steep.

[Wharton]

Most banks charge £1 per day for an arranged overdraft and £6 per day for unarranged. Clear your overdraft and change banks.

[LoftyLottie]

I don't pay charges on our arranged overdraft. Well I rarely go into it, but there is a safety barrier of £500 on one account which I have made a few errors on by not transferring funds and I have only paid interest.

[mccfluff]

i pay interst on my overdraft and it works out at £7.50 per month. it sounds like you have the wrong type of account if you use your overdraft all the time. i would talk to your bank about chaning accounts

[woofgang]

I have just checked my bank. I have a planned overdraft facility. Charge is £5 a month if I go into overdraft but this is charged only once no matter how often I go in and out of overdraft. there is also a interest of 19.8%. If the overdrawn amount is less than £10 then there are no charges levied and in any case I have till close of business each day to pay money into my account and avoid the fees entirely.

[LoftyLottie]

Just checked with our bank too. No charges for arranged overdrafts up to £7,500 - just interest.

[woofgang]

Do you pay a fee for the account Lottie? Mine is free

[LoftyLottie]

No, no fees, Woofy.

[woofgang]

woo! can I ask which bank?

[LoftyLottie]

NatWest. We didn't even ask for an arranged overdraft, they just gave us a credit zone a good few years back. I phoned them and said I didn't want such a high amount but it has crept back up again. We have two accounts both with a credit zone facility.

I think that we came under an old set of rules for overdrafts, because looking at the site they are two sets - from what I remember pre 2010 and post 2010.