VexedM8
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#1
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Could someone please explain to me how a 0% overdraft works?
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AmyFenlon
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I think 0% means interest free, so you don't get charged for using the overdraft; I have a student account with Lloyds and have a limit of what the overdraft can go up to.
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SophieSmall
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You will get a certain amount of overdraft allowance for example £500 a 0% overdraft means that you will get charged 0% interest if you use the overdraft. However you will be charged if you go past the allowance.
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VexedM8
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Yeah I know that much guys, cheers - but like, when do you have to put the money back by?
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Welsh_insomniac
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(Original post by VexedM8)
Yeah I know that much guys, cheers - but like, when do you have to put the money back by?
I presume you're opening a student account? If that's correct then you'll be given up to 3 years to pay back your overdraft, however they will lower your amount year on year. For example: You'd have a £500 overdraft in year 1, they'd increase that to £1000 in year 2 and then increase it again to £2000 in year 3. After you graduate your student account will turn into a graduate account and your overdraft will decrease a year after graduation from £2000 to £1000, then a year after from £1000 to £500 and then a year after that to £0.

That's the general gist of things.
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VexedM8
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(Original post by Welsh_insomniac)
I presume you're opening a student account? If that's correct then you'll be given up to 3 years to pay back your overdraft, however they will lower your amount year on year. For example: You'd have a £500 overdraft in year 1, they'd increase that to £1000 in year 2 and then increase it again to £2000 in year 3. After you graduate your student account will turn into a graduate account and your overdraft will decrease a year after graduation from £2000 to £1000, then a year after from £1000 to £500 and then a year after that to £0.

That's the general gist of things.
Ah okay, that's great thank you.

So, how do you use money from the overdraft? Do you just withdraw it as you normally would with any money or?
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SophieSmall
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(Original post by VexedM8)
Ah okay, that's great thank you.

So, how do you use money from the overdraft? Do you just withdraw it as you normally would with any money or?
yes.
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VexedM8
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#8
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(Original post by SophieSmall)
yes.
Thank you so much!
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richardbkirch
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Overdrafts mean you can withdraw money from your account even if your account funds reaches to 0. Basically, bank allows people to ​borrow a set amount of money.
If you have an
overdraft account, your bank will cover the check which would otherwise bonus.
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AmyFenlon
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I think you have to check with your bank about how long you would have to pay it back. Also with Lloyds I had to change my overdraft limit before I could use it and if I went over the limit i had set they sent me letters to say they were charging me, but i dont think they did So you may have to activate the overdraft before you can use it.
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