Packaged Account Fees

[leclerc]

Re: Packaged Account Fees

It depends, if the one single benefit would cost you less by upgrading your account.

Eg. If you were paying £110 for AA breakdown cover but with upgrading your account it only cost £5 per month costing only £60 a year. Saving £50
That is nonsense. The bank does not offer the same coverage as the £110.00 coverage you were paying. Most banks offer the basic roadside assistance and claim it costs £60.00 when it does not. You can price match on that and cut the cost in half therefore losing money on it. We need specific examples so here we go: http://www.lloydstsb.com/current_accounts/added_value_accounts/aa_breakdown_cover2.asp
It's clear they are talking about roadside recovery which for me cost me £36.00 price matched this year. That means based on their basic cost I make a loss on a packaged account.

One size does not fit all. May I reiterate that these accounts do have real benefits for some BUT not for others
I agree with you that the packaged accounts that are on offer COULD benefit SOME customers but they are sold to many people who are ill informed misadvised and until only 4 days ago, the bank had no obligation to care if they were selling an account that was fit for purpose for that person.

It is important for us to make adult and educated decisions about our finances and not get fooled into sales talk. As a parent I am training my children in financial matters as I don't believe the schools go far enough in preparing them for the 'real' world. What I am teaching them is from my own personal experience and I have had my fair share of knocks!

Ruby, what I am showing is perhaps similar a person who was a smoker but is a non smoker. I worked in the bank and we missold you granny to be blunt and when people challenged the packaged account we either conned them into keeping it, threatened them with things that were untrue or simply did not care.
I am 100% anti packaged account and I will always be that way when generally the people who will claim missold the account will be able to prove by showing that the bank sold them it by misleading them, sold it to them despite the evidence that they have that they did not need it or simply they exploited their customers for personal and branch gain......bonus culture personified.

[di30]

Re: Packaged Account Fees

I have a case at the moment with the FOS, where the adjudicator agreed to uphold the complaint which is a joint account (I have details on my own thread), but Lloyds have come back to say that we benefitted from the preferential rate via the overdraft and forwarded the calculations for the adjudicator to review.

Before I went joint with hubby, he has his own savings account and I had my own classic account with Lloyds, in about 2007 we decided to go joint but would only give us a packaged accounts, said that was the only option, so basically we have had packaged accounts all the way from 1997 to 2009 when we moved our account elsewhere.
They upgraded our accounts over the years, we never requested them, they did say if we wanted a good rate loan then its best to upgrade, so it was upgraded all the way up to the Premier account. We've had them all.

Our adjudicator is currently looking at the information of the preferential rates and the calculations, and I understand this could put a damper on the original decision made, but the point here is the accounts were forever being upgraded without us having a say so and we had separate cover and cheaper elsewhere, with home insurance etc, and never once been abroad, and never will, so european travel is/was no good to us.

I can now see that ID theft is automatic anyway, cover or no cover as long as not being negligent.
We have a number of pre-med conditions, we not always had a mobile phone, just in recent years.

The only benefit would have been breakdown.

It appears that they go by the fact that even if you did not need or use them, you may still have been eligible. Going by some researching.

My adjudicator did say by email we are welcome to forward any further info to support out case, but am really not sure how to get around this one, of the preferential rates, despite our reason.:tinysmile_hmm_t2:

Any help on this will be great thank you.

(I did apply to my thread about this a few weeks back) but not received a reply as yet, so hope you dont mind me posting here folks lol thanks in advance!

I am more on the PPI end, and am learning on this one as I go along. Cheers.

[di30]

Re: Packaged Account Fees

Emailed our Adjudicator earlier due to some confusion in regards of packaged accounts and fee free and was told that she had to work out if we would have saved money if we did have a fee free account compared to packaged accounts, any help for this please folks as time is running out on this and we have a short time to forward any further info, am grateful thank you.
Email we just received below, thanks......

Dear Mr and Mrs

Thank you for your email.

Sorry for the confusion. You did not hold a fee free account - you have stated that you were not aware that this option was available to you. As we have discussed, you would have been eligible for a free account however you have had three different fee paying accounts with Lloyds. My understanding is that if you had been given the option of a free account, this is what you would have chosen.

I therefore need to work out whether you saved money by having the packaged accounts which offered a preferential rate on your overdraft. If you did save money by having the packaged accounts, I would be unable to say that you suffered any financial detriment - this is because it would have cost you more money to have a free account. As such even if there were shortcomings in the way the accounts were sold, if it saved you money I would be unable to conclude that you would have acted any differently had you been provided with the correct information.

I hope this makes sense and I appreciate it is quite complicated. If you require further clarification and would like to discuss this in more detail please call me on my direct line listed below.

Yours sincerely


Adjudicator
Financial Ombudsman Service

[Amethyst]

Re: Packaged Account Fees

Hi Di,

I haven't been through all your thread so you may well have gone through these bits already -alongside the add on ''benefits'' were there any preferential overdraft facilties/interest rates/returned item fees etc when compared to the free account. Having three fee paying accounts would surely cancel out the benefits on two of them - so that should be quite straightforwards to evidence those other accounts didnt save you money. Also I'm sure Nattie did a post ages ago about working out how much the benefits were actually worth to you - I'll have a hunt (mind you just read back a bit and he's posted quite a lot on here anyway :doggieyes: )

My basic roadside renewal was for £42 this year (I had it 'free' with home insurance last year).

Ame
xx

[di30]

Re: Packaged Account Fees

Hi Di,

I haven't been through all your thread so you may well have gone through these bits already -alongside the add on ''benefits'' were there any preferential overdraft facilties/interest rates/returned item fees etc when compared to the free account. Having three fee paying accounts would surely cancel out the benefits on two of them - so that should be quite straightforwards to evidence those other accounts didnt save you money. Also I'm sure Nattie did a post ages ago about working out how much the benefits were actually worth to you - I'll have a hunt.

Ame
xx

Hi Ame
Thank you for your quick response.

I have statements going quite a way back so wonder if anything will arise on them, but the only benefit that was then beneficial was breakdown cover, everything else we had covered elsewhere, we even had separate home insurance to cover most with Lloyds as well. Never had issues in regards of returned/item fees. I am really not sure what free accounts entailed to be honest as I've never had one lol.

Good thinking on the fact that that having 3 fee paying accounts would cancel out the benefits on the 2 of them.

Reading through one of Natties post on here, I'm sure there are some benefits like ID theft etc is usually included free or paying account.

I appreciate it big time thank you Ame xx

[di30]

Re: Packaged Account Fees

Does anyone of you folks know what I should be looking for if you know please (on statements etc) I take it the calculations the adjudicator received are from statement/info Lloyds have sent them?
Thank you.

The gutting thing about this is that the adjudicator originally upheld it and lloyds decides at that point to forward these details last minute, why didnt they do this when they first sent the adjudicator info?? :-/

(Does Nattie still post on here)? xx

[EXC]

Re: Packaged Account Fees

I'm probably not going to be much help and don't know if I've got this right but from what I understand the 'benefit' that the adjudicator is concerned with is the preferential rate on your overdraft versus what you paid in account fees that were surplus to your requirements so maybe you should try and work out the savings you made on your overdraft rate compared to the overdraft rate you would have got with a free account, if you know what that is.

[di30]

Re: Packaged Account Fees

I'm probably not going to be much help and don't know if I've got this right but from what I understand the 'benefit' that the adjudicator is concerned with is the preferential rate on your overdraft versus what you paid in account fees that were surplus to your requirements so maybe you should try and work out the savings you made on your overdraft rate compared to the overdraft rate you would have got with a free account, if you know what that is.

You are correct EXC thank you for that right so would bank statements show this? lol.

Like PPI will eventually get there lol.

[EXC]

Re: Packaged Account Fees

You're very welcome Di - just hope I'm right!

[di30]

Re: Packaged Account Fees

Found pages 3, 4,5 and 6 of account charges and interest etc, as not too sure where to be looking in the paperwork in regards of the preferential rates etc, but as well as the final account being £25 a month (Premier), charges were excessive for obviously going into the overdraft, for example as well as the monthly £25 overdraft interest as shown as £55.67, £45.54, £52.87, £50.87, £48.44 and more, so rather high.

Is that anything to do with what the Adjudicator states?

[EXC]

Re: Packaged Account Fees

Found pages 3, 4,5 and 6 of account charges and interest etc, as not too sure where to be looking in the paperwork in regards of the preferential rates etc, but as well as the final account being £25 a month (Premier), charges were excessive for obviously going into the overdraft, for example as well as the monthly £25 overdraft interest as shown as £55.67, £45.54, £52.87, £50.87, £48.44 and more, so rather high.

Is that anything to do with what the Adjudicator states?

The adjudicator states ''a preferential rate on your overdraft'' which to me is the total cost of your arranged overdraft (interest and charges), as opposed to any fees and interest for unauthorized overdrafts.

So I think he's asking you to compare what you actually paid for your overdraft on your packaged accounts compared to what you would have paid if you'd have had a free account, for which you'd need to find out the overdraft rates for both types of accounts and factor in your actual overdraft usage to arrive at the figures.

So if you saved x amount on the overdraft rates on the packaged accounts (compared to a free account) he'd want to compare that with what you paid in packaged account fees to establish whether you saved money or suffered detriment overall.

I take it you had an arranged overdraft and used it because if you didn't you wouldn't have saved anything and he should be upholding your complaint on that basis.

But if I were you I would take him up on his offer to discuss this in more detail and call him on his direct line to be sure.

[di30]

Re: Packaged Account Fees

Had another email this morning.......(thanks EXC)

Dear Mr and Mrs

Thank you for your email.

You are still able to forward further information at this point and I am happy to review any further information you provide.

If, for example, by having the packaged account you saved £30 a month as you had a preferential overdraft rate, and the monthly account fee was £10, then this account would have saved you £20 a month. The packaged account would therefore have been more financially beneficial than a free account.

I hope this clarifies things, if you have any further questions please let me know.

Yours sincerely

Adjudicator

[EXC]

Re: Packaged Account Fees

Ok but what I don't understand is that in order to calculate the savings on the overdraft rate he'd have to know the difference between the rate of the packaged and free accounts and also your level of usage of the overdraft over the period as I assume the rates actually payable are dependent on it.

[di30]

Re: Packaged Account Fees

Ok but what I don't understand is that in order to calculate the savings on the overdraft rate he'd have to know the difference between the rate of the packaged and free accounts and also your level of usage of the overdraft over the period as I assume the rates actually payable are dependent on it.

Thanks again EXC I appreciate it. I have to admit I do find it confusing as i'm not sure what a fee free account would benefit, I do know or think I know that some benefits are automatic like ID theft etc.

I had separate insurances with Lloyds since about 1997 all the way up to about 2003 house insurance etc, contents etc, then taken out another one elsewhere as it benefitted with lots of benefits, so did not require the main of the benefits package.

The fact that we fell into difficulties in 2007 as where my hubby then worked closed down and went into liquidation just days before xmas, (the year they moved us on automatically to Premier) top account, and finally it went to collections) so with going over the overdraft which led to excessive fees, I way paying not far off £100 a month fees with the monthly account fee of £25.
Not sure how we would be saving there and as this happened, they failed in their duty because the account fee was potentially causing the account to incur charges, therefore unaffordable......


As you know when a business close down. your left with no wages whatsoever to enter into the account, we had lots of problems with lloyds from then on.

[EXC]

Re: Packaged Account Fees

From reading the e-mails again the adjudicator seems to be taking the default position that you did save money overall by having a packaged account but offering you the chance to prove otherwise. As you probably don't have the information to demonstrate that, how about asking him to ask the bank for the information as they would have it.