Banking questions

[singlemom]

I was wondering if any member of this forum is from a banking background? If so I was wondering if you could help me understand how the process really works.
I do not have a good credit record. I am a single parent, rent privately with three teenage daughters. (two at Uni).
I am going out my way to make sensible financial decisions and trying to set aside a small amount for an emergency fund.

I am curious, how I passed the credit test and recently was accepted for a current account? The bank stated in their application that they credit check you.
Naturally, I want to make a good impression and have my salary, tax credits and housing benefit credited to my current account. However, at any stage will they carry out a further credit check? I read somewhere that some banks have monthly feeds from credit agencies. So could they suddenly get a warning that I do not have a good credit rating?
It is just I have gone to the trouble of contacting salaries, Housing benefit, Tax Credits to pay in my new bank. I would not want them to suddenly close it.
They give the impression you have a pre approved overdraft. That would be useful for emergencies. However, I take it they would have to update your status to all the Credit reporting agencies? Would they see the whole of your file?

Any advice would be greatly appreciated please.

[alham]

Re: Banking questions

If you were accepted and have signed the account forms you will be fine. Further checks are not a usual procedures - unless you are asking for a credit card. If you are using your overdraft sensibly your credit record will improve dramatically. Different institutions use different (some all) credit ref agencies - usually you can find the name of agencies used in the small print of the paperwork. BTW, why do you think you have bad credit history?

[leclerc]

Re: Banking questions

completely agree with Alham, everything depends on credit reports. The bank will have an internal credit score for you based on payments made on time(for credit cards) based on income/outgoings over the month(which I think can potentially be manipulated) most credit references agencies used are experian and what's the other ones Alham(brain really needs a slap!!!).

[singlemom]

Re: Banking questions

Thank you for your replies! I have a couple of payday loans that are in dispute. I will never ever use payday loans again. So that is probably showing on my credit file. Also, a smallish overdraft from another bank I am repaying. Also, a visa card from a few years back that went on to a collection agency. However, I have made such an effort to clear other debts.
The problem is up to now I could just about cope on my own. However, housing benefit was dramatically reduced when my middle daughter went to Uni. (I have two at Uni and a 13 year old at home). My rent is very high. I am trying to increase my hours at work (I currently work 30 hours but full time is 37.5) My energy bills are very high. I need to compare different Companies.

[leclerc]

Re: Banking questions

Remember that if you are struggling with the bank then perhaps making them aware is another thing ie look at the Lending Code section 9

[alham]

Re: Banking questions

Credit Agencies: Experian, Equifax and Callcredit. Your priority - sort out your payday loan first, keep paying off REGULARLY your credit card even if a small amount, try not to use your new overdraft. Sorry to mention but if your hours go up you will lose more benefit - I know it sounds horrible but have you thought of moving to reduce rent? Things are about to get even tougher.

[singlemom]

Re: Banking questions

Hi Alham. If I moved further out then I would have the additional expense of train fares to get into work. This would be the same for my youngest daughter to get to Secondary school. I am just a 20 minute walk from work.
It is a catch 22.
I need to educate myself not to rely on credit. Have to start saving for an emergency fund. If I could reduce my energy bills and literally go on an economy drive I would be fine. I am also paying over the top on council tax. I am convinced they have made some kind of error. I should be paying 124 pounds per month but they are charging 170. They said I was not paying enough council tax last year. I really have to check the paperwork. I think they have payments missing.

[alham]

Re: Banking questions

Quick update singlemom, just discovered that my council has missed over £700 of my payments over the last three years from my council tax. I suggest that you request your history for the last five years and check it against your liability summary, you may find that you are ££s in. Good luck.

[singlemom]

Re: Banking questions

Thank you Alham. I will definitely ask them. I sent an e mail recently and explained my situation and it has now been reduced. (monthly payments). However, there has to be missing payments for them to increase the instalments so much.

[alham]

Re: Banking questions

I've requested and received payment list for the last 7 years, after checking I found over £1200 gone missing!!!!! But I was able to check my bank statements online otherwise I don't know how one would do it (does anyone keeps their old bank statements?)

[singlemom]

Re: Banking questions

One of my problems is I do not check bank statements properly. At the moment I receive paperless statement statements. I am now amending it to receive paper statements.

[SpringerSpaniel]

Re: Banking questions

If your daughter receives any help due to her disability you might qualify for the Warm Front scheme to help improve the insulation of your home, which will reduce the utility bills. Are houisng benefit aware that a member of your household has a disability ? This may affect how much they give you.

[alham]

Re: Banking questions

One of my problems is I do not check bank statements properly. At the moment I receive paperless statement statements. I am now amending it to receive paper statements.

Can you access them online? That maybe very helpful

[singlemom]

Re: Banking questions

Housing Benefit are aware that my daughter has applied for Disability Living Allowance. They have told me as soon as there is a decision to let them know straight away. She has an interview on campus on the 30th of November.

[enquirer]

Re: Banking questions

(does anyone keeps their old bank statements?)

Yes, for 6 years. And it's saved my bacon numerous times.