closing my account

[coxy]

Hi everyone - first post.

 

I'm just reading throught the various FAQs and information, but can find no mention of my specific query. I basically live in my overdraft - set at £2000 - hence I have had a number of charges, which I am looking in to claiming back. But, should they choose to close my account, what will happen? Will they try to claim back my overdraft, i.e. charge me the £2000?

 

Hope this makes sense and someone can help. Cheers.

[carlyt123]

Hi,

 

Well basically there have been some cases where acounts have been closed. My Lloyds a/c was closd aftr I won my case, but as Ididn;t have an overdraft and had already opened a new a/c I wasn't bothered.

However, there are things you can do as Sophie-Jane pointed out to me.

This is what she said

First what I would do, is send a letter to your bank about the OFT ruling in April 2006, that The OFT would look unfavourably at your account closure, and any retalitory action inplied or taken will result in an Court injunction being pursued forthwith

 

If they have implied that this retalitory action is being taken, then also state that their letter will be sent together with a complaint to the OFT, and also will be produced in court

 

The FSA and Banking code, would also look unfavourable at your bank, as they are taking retalitory action for a LEGAL process which you ave taken, even thou they have not taken it all the way thru the court.

 

BTW, Have they said that YOU are closing your account??

or is it direct action against you after winning??

 

There is a thread about this, quite recently, I will check if I can find it for you, the thread is especially if they think that YOU are the instigator in closing your account

Normally, its the left hand not knowing what the right hand is doing

 

So it seems you can still try and prevent this happening on retaliatory grounds.

 

I hope this helps

 

Carly

[coxy]

Thanks for the reply. I'm yet to start any sort of proceedings regarding claiming my money back, but being shafted because of my overdraft and suddenly being asked to pay £2k is something I'm worried about, so wanted to check before I start.

[carlyt123]

Hi,

 

No problem, it is deifnitely best to be well informed before yout ake them on

 

Good luck!

 

Carly

[caro]

Alliance & Leicester have stated publicly that they will close the account of anyone who claims their charges back, and will not pay back unless a court claim is started. They have also stated that they will not actually go to court. You will definitely need a parachute account. How much of your overdraft is down to charges? Is there any chance that the reclaimed bank charges would pay off your overdraft?

[coxy]

I see... Well that sounds rather ominous.

 

My charges would amount to a good few hundred pounds, but not £2000 - the limit of my overdraft around which I hover.

 

I have another current account, but would worry about A & L demanding this overdraft is somehow instantly paid-off.

 

Thanks for your reply, I look forward to any more responses and advice. Cheers.

[johnsacco]

I'm in exactly the same boat mate - live in my A&L overdraft of £2k and my claim will only be circa £500. If I claim I know they will close the account, so I'll need a parachute account with a £1500 overdraft facility! Anyone know of any bank which is particularly leanient with their overdraft levels?

 

Thanks all.

[stodman]

After AnL paid out i revieved 2 letters,

No 1: Told me that my debit card had been deactivated due to the "poor" conduct of my account.

 

No2. "AS it is clear that you do not accept cerain aspects of the terms and conditions for the operation of your account we are unable to continue to offer you banking facilities". ( giving me 30 days notice).

 

Not letting them get the last word, so with help from Mcuth's threads. I Sent them this:-

 

Current Account Number xxxxxxxxx

 

Thank you for your letter of 20th July 2006.

 

As you are no doubt aware, I consider that your penalty charges for returned standing orders, direct debits, cheques, etc. are unlawful and unenforceable. Thus, I do not accept the clauses of your terms & conditions that allows you to levy such disproportionate, unfair & unlawful penalties.

 

I consider the proposed enforced closing of the above account to be a punitive retaliatory measure in respect of my recent County Court action against yourselves with regards to recovering your unlawfully applied penalty charges. In fact, your public announcements completely support this conclusion:

 

during an interview on the Radio 4 MoneyBox program. The A&L spokesperson said; (paraphrasing) "we will continue to pay claims because it's not worth our while defending the claims because we can't get our legal costs back. But we will close accounts if someone claims". She also said, in relation to the overdraft charges; "the £50 is not what it costs, but it is fair".

 

As the penalty charges are unfair under the Unfair Terms in Consumer Contracts Regulations, it follows that an account closure made in response to a challenge to unfair charges must itself be unfair under the Regulations.

In the Unfair Terms In Consumer Contracts Regulations 1999, it states:

 

Effect of unfair term

8.

 

(1)An unfair term in a contract concluded with a consumer by a seller or supplier shall not be binding on the consumer.

 

(2)The contract shall continue to bind the parties if it is capable of continuing in existence without the unfair term.

Whilst I will not be challenging the closure at this time, I will be taking further advice on the situation and reserve the right to challenge it in the future.

Yours sincerely

 

LOL, see what the response is, if any!

[caro]

If the bank tells you to repay the overdraft in full, don't panic.

 

Work out how much you can repay per week/month without leaving you in financial dire straits. Write to the bank telling them that you can not possibly repay the o/d in one go, and that you will pay back £xx per wk/mth/4 wks/whatever until o/d is cleared. Enclose 1st payment in letter. If they cash the cheque, it will be all the harder for them, in the case of future argument, to explain why, if they didn't accept the agreement, they cashed the cheque. You need to say in your letter that this is the best you can do, and if they are not happy with it, they can and should take you to court and ask a judge to decide what and how much you should repay. Oh, and demand that they freeze interest onto the debt until it is paid off. (they probably won't, but it is aways worth a try)

 

Here's the news: The bank doesn't want to go to court on that either, for the following reasons:

 

a) Like the rest of us, they have a duty to mediate outside the court sytem. If you have made a reasonable offer, a judge will not take kindly to them litigating.

 

b) Depending on what you offered to repay and what your existing debts are, a judge could well decide to award them LESS than what you have offered to repay in the first instance. Because a bank o/d is not a "necessary" debt, it is at the bottom of expenditure, and before a judge decides how much you should repay the bank, he'll look at all your other outgoings, mortgage, food, electricity and so on... Then, on a sliding scale of importance, until it gets to the overdraft... And since you had made an offer of repayment as it is, and kept to it, he is not going to put the bank very high in the order of priority. And the bank knows this.

 

The 3 important things to remember are these: Enclose 1st payment with your proposal. Keep up the payments. Don't budge once you have made your proposal, no matter what they say.

 

In all likelihood, when you win your charges back, they will pay them againt the o/draft. Fair enough. Think of it as one less debt hanging around your neck on the way to financial recovery.

[bakerag]

I have recently had a letter from the Alliance and Leicester saying they are going to close my account, and I have been in contact with the Financial Services Ombudsman (0845 080 1800) who are writing to the bank, I'm not sure how much good it will do, but it is another option.

 

Has anyone else done the same and what was the outcome?

[coxy]

Got a letter from A&L today saying they are dropping charges from £25 a pop to £12. Better than a kick in the teeth.

[caro]

Well that implies it didn't cost them £25 a time, and I frankly doubt it cost them £12 either, but if they care to prove it I will be amazed.