04.28.07
A victory for the little person
One of my greatest challenges over the last year has been to come to terms with the fact that for a long time I have been spending far more than I earn. Hubby’s salary fluctuates due to overtime (or lack of it) but we have tended to think it is our right to continue to spend what we haven’t earned and all will be well with the world. Well about a year ago, I realised that all wasn’t well and if I wasn’t careful something very nasty could happen. Since then I have cut up all credit cards and been in dispute with various companies over the amount I can pay back in any single month. For a while that meant dozens of phone calls, some of them threatening every day from people in various call centres around the world, but thankfully arrangements have been made with all of those companies and all money will eventually be paid back. In fact my debt has already fallen by £8000, quite an achievement even if I do say so myself.
When you get into this kind of position, the banks and their charging policies really don’t make life easier for you. I have never expected to be able to take the bank’s money for nothing, but at times the charges caused me to go further into debt, resulting in a kind of downward spiral of borrowing, charges, more borrowing etc. A number of websites are now devoted to advising on money issues, including the reclaiming of bank charges and thousands of people in this country are reclaiming those charges from their banks. Yesterday I scored a victory against a multinational bank and am to receive back nearly £1800 in bank charges taken in the last 6 years. They do not admit liability and continue to say they are right, but will give me the money anyway. I could get more by taking them to court but actually I think I’ll call it quits.
My attitude to banks and the services they provide has changed significantly over the last year. They do not get you to pay off your overdraft with a loan as an act of charity, and they do not then encourage you to build up a further overdraft as another kind act. They are making money out of this process and whats more, the people who have more money and never go overdrawn are benefiting from this, because my charges subsidise this process. No one wants to give up ‘free’ banking, but I would rather pay a small monthly charge for using the service than pay £150 in one month for going overdrawn when it is their charges for the previous month that caused the problem in the first place.
I should use all of the money to pay off more debt, but this will make the difference between a family holiday and a week spent looking out of my window at my own garden. Therefore we are off to France for a week in July, thanks to the bank and the refund of my own money!
Julie said,
April 28, 2007 at 11:48 am
Its people like you that make my blood boil i live off less than 100 pounds a week with my daughter and have never been overdrawn. We just about scrape through. Thanks to you and selfish people like you we now face an extra fee of paying to use the bank cos lowlifes like you cant control your spending!! You will never learn until youve drowned in all your own debt. I bet you go on hol every year and ave a full wardrobe of designer clothes which is not even paid for. I dont dispute the fact that the banks are wrong to charge so much and that you deserve to get your money back but to laugh and say your not gonna put the money towards your debts is absurd!! I feel sorry for your husband and i hope you dont av kids cos they will grow up to do exactly wot your doin now. But hey thats just my opinion carry on livin the high life cos one day it will all come crashing down on you iv seen it before.
ukcommunitypharmacist said,
April 28, 2007 at 12:36 pm
Sorry, but you pay charges for going overdrawn because you are breaking your agreement with the bank. The size of the charges is highly questionable, but that’s a different question to the existence of charges. And you read the terms and conditions when you opened the account didn’t you?
I have no sympathy for you, because as you admit you got yourself into the situation with your reckless spending. You need to take a long hard look at how you got yourself into this situation to ensure it doesn’t happen again. You’re obviously not on the poverty line, so its easy really - don’t spend more than you earn.
And could you explain to me why I should pay for the privilege of accessing my money?
Julie said,
April 28, 2007 at 1:27 pm
Thanks both of you for your support.
It is very easy to judge people about their life choices, and some people learn the hard way. If I had my time again I would never have a credit card and never spend what didn’t belong to me. However I didn’t do that and now I am paying for that choice. Whatever you believe is right, this is my blog, I am recounting my honest opinions and if you don’t like them then don’t visit and don’t read my blog.
Thank you
turnthetables said,
April 28, 2007 at 8:28 pm
Im curious how you started out without the view that banks exist solely to make money, for quite some time now they have been businesses? Not trying to get at you as with the above comments, im really curious how you started with that mind set. Ive never really viewed them as anything but a convenience, like any other business. In which case they try and make as much money out of me as possible, and I try to use there services in such a way as to make as much money out of them as possible, and the struggle continues.
Julie said,
April 28, 2007 at 9:37 pm
I am not sure that I ever thought they weren’t a business, but there is something about being told by the bank manager / a very nice lady in the bank that the best way to sort out your over draft is to take one of their very nice loans. Thats all.
I must say I regret posting something quite so personal, and in future will just stick to work related things or those that do not cause me to spend the whole day thinking about the personal nature of the above attacks, particularly the first one.
ukcommunitypharmacist said,
April 28, 2007 at 11:02 pm
I do find your blog interesting, the above post just touched a nerve somewhat. My earlier comment probably came across as harsher than meant, but that’s one of the problems with written communication. As I’m sure you know, when speaking to someone, what you say isn’t actually that important compared with how you say it and your body language. That all gets lost with written communication and things can be taken out of their intended context.
Criticism can be hard to accept, but can be very helpful. I saw one of my local GPs last week. Some patients have been taking my comments completely out of context - one of the other GPs had a very angry, aggresive husband of a patient to deal with. The patient had been prescribed cef and met, and when I dispensed it I said something along the lines of ‘ok, so we’re not exactly sure what the infection is but this is a good combination as it covers all the bases.’ The patient’s husband somehow interpreted this as the GP not knowing what he was doing! So I had a chat with one of the GPs - it wasn’t an easy chat, but it was very valuable and I’m certainly going to be more circumspect in my comments in the future.
gjmoomin said,
April 29, 2007 at 12:14 am
Having faced what at the time seemed a huge debt ( cos I had a husband who gambled) and I took out one of those nicely offered bank loans, couldnt pay, got suicidal, took 10 years to sort out and am left obsessively tight with money, was pushed further into debt by the bank charges on their own loan. I can see this from both sides. Take heart. Enjoy the holiday-then concentrate on paying off the debts before the next one. Good Luck
Claim Bank Charges Back said,
April 29, 2007 at 11:24 pm
To those people who have written comments expressing rage about people claiming their charges back, there a few points you need to think about:
1) Not all bank charges come about from poor financial management, its not always the persons fault if they charged, it could be because someone else has bounced a cheque on them for example, or a company taking a direct debit out too early (which the bank will do nothing about, the direct debit guarentee is not worth the paper its written on).
2) Although I run a site helping people claim their bank charges back, its not bank charges per se that I have an issue with. If the charges were smaller, myself and I suspect many others would not claim them back. As it is though, the bank are being greedy, and in doing so breaking the law. They are treating people unfairly, and should not be allowed to get away with it.
3) There is no need for the banks to introduce charges on accounts if penalty charges do. The banks main source of revenue is from you lending them your money, and the bank paying you a small amount of interest, and then they lend it out to someone at a much higher rate of interest. This will continue as it has always done, and the banks make a huge amount of profit from this. Penalty charges being stopped is not going to bankrupt the banks, the banks wanting fees to replace them is just plain greed.
4) Barclays for example, paid one of their executives £40 million last year. Is this a fair wage for one person? Is anyone worth this much? If they stopped these massive payouts, then they would have the same amount of money without bringing in fees for accounts.
5) At the moment, the system is blatantly unfair. At the extreme, its a case of poor people (who run their accounts with a near 0 balance) getting all the fees, and subsidising free banking for the rich (who never get fees as they have large sums of money in their accounts). Does this sound fair to you?
6) A number of banks, such as First Direct, decided to introduce fees before people started claiming their charges back in such high numbers, suggesting that fees for accounts would have happened anyway in the long run!
Just a few points points to think about before you start criticising people who are claiming their bank charges back!
For anyone who is interested in claiming their own charges back, have a look at my site http://www.claimbankchargesback.co.uk. It has detailed step by step guides covering the whole process, the latest bank charge news, forums for one to one advice, and a unique guide to filing your claim online.
The site is completely free to use!
turnthetables said,
May 1, 2007 at 8:26 pm
I am not saying I agree with the current situation with charges, but, I do find it quite odd that as a business a bank should not be able to charge people whatever they like for breaking terms and conditions which they agreed too. If the consensus is that we are going to live in a free market economy surely being greedy is the best way for a bank, or any company I suppose, to make money?
Julie said,
May 1, 2007 at 9:11 pm
Well they have to be able to justify their charges and if all you have to do is write to them and say you took £2k off me give it back and they pretty much do then they know they are doing wrong. If I go over drawn I expect to pay for it, but being charged £150 for the pleasure is obscene and they know it. By the way I am no longer going overdrawn as I have sorted myself out financially.
turnthetables said,
May 2, 2007 at 8:56 pm
I assume having to justify the chargest forms part of a law? I am certainly not saying charges are nice, but im not sure I understand why as a business they cannot charge whatever they like. For example, as far as I am aware, I can put an item on ebay with a buy-it-now price of £10000, even if it is only worth £1, as long as I am honest about it. Should the law be changed in this case, and many others, incase someone chooses to buy it then decides they cant afford it?
Julie said,
May 2, 2007 at 9:28 pm
They are regulated though and as such are meant only to charge a ‘reasonable’ amount. The banks keep settling before they get to court, therefore there are no test cases yet.
If you sell something worth £1 on ebay for 10000, so long as it isn’t misrepresented there is probably nothing to be done. If it is then I guess you get sued!
Claim Bank Charges Back said,
May 3, 2007 at 1:47 pm
Its not like your case that you could charge £10000 for something on ebay that only worth £1, as long as your honest about it. In this case you can of course charge what you like for it.
Its a different case with the banks, because the law states that they are only allowed to charge customers what the breach actually costs them, and THEY ARE NOT ALLOWED TO PROFIT FROM THE CHARGES.
So, the case with the banks is that they are actually breaking the law by what they are doing.
However, its not so simple because no one knows how much exactly it does cost the banks, although its universally agreed that its not the £20 - £30 they charge!
Basically, although its technically illegal, it needs a ruling from a judge to clarify this. If the case went to court, then the judge would rule against the banks. However, the banks are stopping the cases from going to court, so that ruling cannot be made. This allows them to keep charging their massive charges, on the basis that not everybody will, or knows, that they can claim them back.
The basic problem is one of greed on the banks behalf. If they were lower, and fairer, then its unlikely that this situation would ever have occured, and they would have got away with it.
I had contact from someone this morning, who went a little over £10 overdrawn, over 3 transactions. Yes, it was their fault they went overdrawn, however, rather than slapping one charge on the person for the day, the banks slapped 3, one for each breach. So, for going £10 overdrawn, they were charged £90!!!
I doubt there is anyone who would agree thats fair!
http://www.claimbankchargesback.co.uk
Julie said,
May 3, 2007 at 2:47 pm
Thanks,
In some cases this is what starts that downward spiral, which in my case resulted in the banks ‘helping me out’ by lending me money to consolidate and the process goes on. It is time there was a difinitive ruling and someone made the banks face the music.
turnthetables said,
May 3, 2007 at 8:18 pm
Im not particularly saying I like or agree with what the banks are doing, but I still have not seen a reason why even the law should limit them in this way. All businesses are greedy, not many are fair.