Bank taking overdraft charges from my benefit

[bambisoloved]

Hello

Is it true that it is illegal for the bank to take over draft charges from your benefit payments.

If it is what can I do about it please

Any advice would be appreciated


banbisoloved

[CleverClogs]

Re: Bank taking overdraft charges from my benefit

Is it true that it is illegal for the bank to take overdraft charges from your benefit payments?

Unfortunately not.

Open another bank account with a completely separate bank. Even if you have to open a basic bank account, it should be better than your current situation.

Then get your benefit payments transferred to that new account and tell your old bank what you've done, and why.

[leclerc]

Re: Bank taking overdraft charges from my benefit

Hello

Is it true that it is illegal for the bank to take over draft charges from your benefit payments.

If it is what can I do about it please

Any advice would be appreciated


banbisoloved

To add to this, please do not come back and post a link that says it is illegal because it isn't nor is it unlawful(which is what you actually mean since illegal is a criminal matter not a civil matter).

If it is impacting on your ability to pay your essential bills excluding cable/sky tv plus loans and credit cards... then it might be a hardship case or if it is the first time then as a gesture of goodwill the bank might refund them if asked.

[CleverClogs]

Re: Bank taking overdraft charges from my benefit

if it is the first time then as a gesture of goodwill the bank might refund them if asked.

:flypig: :flypig: :flypig: :flypig: :flypig: :flypig: :flypig: :flypig: :flypig: :flypig: :flypig: :flypig: :flypig: :flypig: :flypig: :flypig:

[bluebottle]

Re: Bank taking overdraft charges from my benefit

If your bank is doing this, let DWP know what is going on. If you read the paperwork relating to the benefit you are on, there should be something to the effect that if you find your bank taking your benefit, you should inform DWP asap in order that alternative arrangements can be discussed. Do not let allow this situation to drift. If at all possible, ring DWP first thing on Monday morning.

[bambisoloved]

Re: Bank taking overdraft charges from my benefit

Thanks CleverClogs and BlueBottle for your response and advice

Dear ieclerc

I beg your pardon but I got my information from Kettering Borough Council web site. I quote


Banks are not allowed to use Housing Benefit or any other income related benefit to repay an overdraft as the law provides that a customer needs a minimum amount of money to live on.
Arguably, the money is not actually the claimant`s they are just the agent to pass the money along to their landlord. If the bank do use this money to offset an overdraft the customer should be advised to seek legal advice or contact CAB for further help to claim back any charged. end of quote

If their is a law in place then it follows that if a bank does take money from your benefit to pay for overdraft charges doesnt it follow that it is illegal for the banks to do this ?

www.ketteringboroughcouncil.gov.uk/info
put in box banks and benefits and scroll down


I am not just following what I have read so I will post what I like thank you

bambisoloved

[leclerc]

Re: Bank taking overdraft charges from my benefit

Thanks CleverClogs and BlueBottle for your response and advice

Dear ieclerc

I beg your pardon but I got my information from Kettering Borough Council web site. I quote


Banks are not allowed to use Housing Benefit or any other income related benefit to repay an overdraft as the law provides that a customer needs a minimum amount of money to live on.
Arguably, the money is not actually the claimant`s they are just the agent to pass the money along to their landlord. If the bank do use this money to offset an overdraft the customer should be advised to seek legal advice or contact CAB for further help to claim back any charged. end of quote

If their is a law in place then it follows that if a bank does take money from your benefit to pay for overdraft charges doesnt it follow that it is illegal for the banks to do this ?

www.ketteringboroughcouncil.gov.uk/info
put in box banks and benefits and scroll down


I am not just following what I have read so I will post what I like thank you

bambisoloved

They are wrong btw. I thought it might have been Corby who I think originally quoted that piece. Unfortunately the damage that they do by posting inaccurate and false information means everytime posters quote it on forums, those of us who have been here long enough on the forums have to correct it.

[leclerc]

Re: Bank taking overdraft charges from my benefit

http://www.kettering.gov.uk/info/200...y_an_overdraft

The above is the direct link and I would say that if this happens that the bank should be approached on the basis that the money is for their priority debt, ie rent.

[leclerc]

Re: Bank taking overdraft charges from my benefit

Furthermore the document that Kettering have got on their PDF then refers you to another PDF from citizen's advice which states this on bank charges:

"Bank chargesBanks and building societies charge for some services. You must be told about these
charges before you become a customer. If there is any change to the charges, these
must also be clearly and specifically brought to your attention.
Banks charge when you go overdrawn without an arranged overdraft facility, when
you go over any agreed overdraft limit or when there isn't enough money in your
account to cover a withdrawal, for example a cheque. This is called an unauthorised
overdraft. Unauthorised overdrafts are often considered to be very high. Many people
have complained that they are unfair and have asked for refunds.
Because there were so many complaints about unfair overdraft charges, the Office of
Fair Trading (OFT) took a test case through the courts and existing complaints were
put on hold.
The Supreme Court decided that the OFT did not have the power to decide if the
charges are unfair. It is likely that your complaint will now be rejected, although your
bank should treat you sympathetically if you can show financial hardship"


So the answer is that yes they can take it and I would add that Kettering quote the Social Security Administration Act 1992, section 187 plus they refer you to a website on reclaiming charges that no longer exists.

[bambisoloved]

Re: Bank taking overdraft charges from my benefit

Dear Ieclerk

With respect I know all of what you are saying in your last post.

My issue is can the banks take overdraft charges from your benefit which is the money you are given to live on ? where your only sorce of income is what you get from your benefits.



bambisoloved

[Inca]

Re: Bank taking overdraft charges from my benefit

Dear Ieclerk

With respect I know all of what you are saying in your last post.

My issue is can the banks take overdraft charges from your benefit which is the money you are given to live on ? where your only sorce of income is what you get from your benefits.



bambisoloved

And the short sharp answer is (sadly) Yes,,they can.

Why don't you open another basic bank account (Nationwide amongst others do these),,get your benefits paid into there.(they issue debit cards)
That will prevent your current back taking the first slice of your benefit cake (for want of a better word)

[leclerc]

Re: Bank taking overdraft charges from my benefit

Dear Ieclerk

With respect I know all of what you are saying in your last post.

My issue is can the banks take overdraft charges from your benefit which is the money you are given to live on ? where your only sorce of income is what you get from your benefits.



bambisoloved

I cannot really add further to what Inca has said, the answer is that when benefits are paid into your account it then becomes income and therefore the same as if you were going to work and being paid a salary.

You can approach the bank on the issue of financial hardship and they should be sympathetic. You can do what Inca has suggested but there might be a debt still to pay off at the other bank.

The Act of Parliament quoted by the borough council does not apply to benefits paid into a personal bank account.

[CleverClogs]

Re: Bank taking overdraft charges from my benefit

And the short sharp answer is (sadly) Yes,,they can.

Why don't you open another basic bank account (Nationwide amongst others do these),,get your benefits paid into there.(they issue debit cards)
That will prevent your current back taking the first slice of your benefit cake (for want of a better word)

See post #2.

I had this same problem some years ago with the twerps at RBS; they regarded all the money going into my (overdrawn) account as being entirely their money and I had to 'phone them up every fortnight to beg them to be allowed some of it to pay for food. Fortunately, I already had another account set up with another bank from more prosperous times, so I got my benefits paid into that instead. The RBS was less than delighted, but it put me back in control.

[bambisoloved]

Re: Bank taking overdraft charges from my benefit

Dear all

Ok I get it. I accept what you are saying and I will open another bank account as you have suggested

The artical from the Kettering Borough Council is misleading If I didnt know about legal beagles I would be writing to the bank asking for my money back.

bambisoloved

[Inca]

Re: Bank taking overdraft charges from my benefit

I only found out about being able to open an account with Nationwide from joining here (I also found out that bailiffs lie and it's never a good idea to invite them in ones house).

And as leclerc has rightly pointed out...you may still have a debt with your present bank that may need addressing.