- Tuesday, 12 January 2010Struggling consumers could need
IVA help after slipping into an unauthorised overdraft.
Andrew Hagger, of price comparison website moneynet.co.uk, is warning people who are struggling to avoid exceeding their limit before January pay day that they risk facing hefty bank charges resulting from unauthorised overdrafts.
There is no common policy on such fees among banks, claims Mr Hagger, with some providers charging daily, monthly or even both.
He recommends people apply for an authorised overdraft to tide them over, and to allow them some financial breathing space.
"The cost of an authorised overdraft is a mere fraction of the cost of unauthorised borrowing, and a arranging a temporary increase for a couple of months whilst you get your finances back on track could save you from some crippling bank charges which could turn a minor problem into something more serious," Mr Hagger said.
Research by the Finance and Leasing Association revealed that last Christmas the average consumer spent 11 per cent more on credit cards and 25 per cent more on store cards than they spent during the other 11 months of the year.
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