How do student account overdrafts work? Watch

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#21
Report 9 years ago
#21
(Original post by adamp405)
So just to clear it up with me because i'm a bit slow. if u was maxed out on your overdraft, then you got money that puts you above the minus, can you return to below the minus if you need to or will the bank hold the money to repay your current overdraft
Yes - so say you're at -£1000 (i.e. you have no money of your own, and owe the bank a thousand pounds, which is the overdraft), then you pay in £1100, your account balance will be £100 (because £1000 of that £1100 just took away your debt to the bank) but you can spend all the £1100 out of that account - the £100 balance (which is your money) and the £1000 overdraft (which is the bank's money). Even though the money is technically used to pay your loan off, the loan's still available, so you don't lose out at all.
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