Thursday 9th of December 2010
Individuals hit by overdraft charges on top of debt that is already causing them a large amount of financial strain may seek individual voluntary arrangement answers to try and rectify their monetary situation.
Ed Bowsher, head of consumer finance at lovemoney.com, said he believes come Brits are unaware they will be charged for an overdraft and even more unlikely to know how big these sums can be.
He noted that some financial institutions have made substantial increases to the amount people going into the red are forced to pay, at a time when the base rate is at a record low.
"When you join a bank, find out if it charges for overdrafts via a daily fee or via an interest charge," Mr Bowsher advised.
He added that people borrowing money from establishments seeking payment on an everyday basis face paying out large amounts as the sums can mount up if a person is in the red for a significant period of time.
Figures released by the Bank of England reveal the rates for authorised overdrafts in October reached 19.09 per cent, compared to 18.89 per cent in July.
By Kimberley Parsons
