Overdraft?

[bigladraz]

Hiya,

I am seriously considering getting an overdraft. How exactly do they work? How long do they take to sep up?

Cheers

[Merlot]

Why?

Spend less?

[bigladraz]

I wish it was that simple.

[mcflurry]

Call your bank, get into debt, moan at overdraft costs and charges, try to claim them back, moan some more, find it harder to pay debt back later as other "stuff" comes up, blame bank for recession. Simples

[Mx_Stu]

bigladraz said:

Hiya,

I am seriously considering getting an overdraft. How exactly do they work?

Its a form of short term borrowing. Don’t make the mistake that is free money as they are expensive. An overdraft should be used for emergency purposes or an advance if for example you want to buy something fairly expensive but you wished to pay it back quicker than a loan would allow.

Say for example you have an overdraft limit of £1,000 and you use it all then you will be charged interest on what borrowed. Say the rate is about 16% per annum on the overdraft you will be charged in the region of £13 per month in interest.

bigladraz said:

How long do they take to sep up?

Cheers

Either call your bank or pop in and see them. They will review your account and advise. In my student days I remember getting towards the end of the second year and struggling a bit financially. Went in and saw the bank and they set up a £1k interest free overdraft there and then (which I promptly used part of to go and but the godfather trilogy on DVD).