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Direct Debit vs credit balance on utility a/c - what happens?

DiamondEcho
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Direct Debit vs credit balance on utility a/c - what happens?

#140360

Postby DiamondEcho » May 21st, 2018, 1:54 pm

For reasons I won't go into here it's possible I will soon be without a UK bank account for a period of perhaps two months. A major concern is that the various direct debits that draw against the present account will default when that account is closed. I expect it's going to start impacting my otherwise very good credit record.

I was wondering whether it's possible to effectively pre-pay the direct debits? For example if my council tax, currently drawn by DD, is say £100 a month, what happens if make a manual payment of say £300 against the council tax account? Will the council try and return the funds to me, or will it sit as a credit on the account? If it sits as a credit does that mean the council would stop trying to draw the DD while my a/c with them remains in credit?

Previously I've set up DDs and just let them run, so have never had to think about it too deeply. I know a standing order draws a fixed sum, but does a DD stop trying to draw if the a/c is in credit, and just leaves the credit sitting there until it's depleted?

This probably sounds like a pretty simple problem, but if I can 'pre-pay' say 3 months of council tax/mortgage/utils on my UK home it would avert the ensuing chaos before my new a/c is activated, credited, and set up to pay them.

I'd appreciate any thoughts!

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Re: Direct Debit vs credit balance on utility a/c - what happens?

#140364

Postby gryffron » May 21st, 2018, 2:22 pm

All council systems are different. So I doubt anyone can give you a definitive answer.

Why not just ring up and cancel all the DDs. Sure they'll be chasing you for the cash for 2 months. You can then find some other way to pay. They're unlikely to start issuing writs for 2 months, so no bad credit record. Or if you cancel earlier, you'll get the first demands before your personal shutdown, allowing you to either find out how to pay manually, or send the a cheque for too much which they can't partially reject.

Gryff

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Re: Direct Debit vs credit balance on utility a/c - what happens?

#140365

Postby Alaric » May 21st, 2018, 2:24 pm

DiamondEcho wrote: I know a standing order draws a fixed sum, but does a DD stop trying to draw if the a/c is in credit, and just leaves the credit sitting there until it's depleted?


You would be gambling on the sophistication or otherwise of the direct debit system being operated. Perhaps it would be better to cancel the DDs and ask the recipients to specify an alternative payment mechanism. Council Tax used to be capable of being operated by paying in slips, perhaps that's still the case?

chas49
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Re: Direct Debit vs credit balance on utility a/c - what happens?

#140366

Postby chas49 » May 21st, 2018, 2:28 pm

Can you get the relevant DDs set up on a friends a/c (and give them the funds) - and then reset them on your own account when that's available?

Allowing the DDs to bounce may affect your credit record...

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Re: Direct Debit vs credit balance on utility a/c - what happens?

#140368

Postby Itsallaguess » May 21st, 2018, 2:44 pm

DiamondEcho wrote:
I'd appreciate any thoughts!


I think early-contact with all the organisations involved will keep any real issues to a minimum.

Account queries are kept on record now, and you can also keep note of who you speak to and when, as you try to find the most appropriate method of dealing with this situation for each direct-debit/organisation.

Whilst this might feel like an unusual position for you to find yourself in, I'm sure the organisations you'll hopefully speak to have really quite standard procedures for dealing with these types of issues, so again, contacting them as soon as possible will allow to hear about the real options you've potentially got available to you.

Whilst you might hear some well-meaning answers here, I think the best thing to do is to just give them all a ring. Most of the organisations you've mentioned will deal with you quickly and efficiently, I'd imagine, and there should be some sort of customer-enquiry number on all of your bills.

No matter what might happen during this 'account-gap' process, for you to be able to say 'I spoke to you about this on xxxxx date, where I made you quite aware of the situation, and we agreed yyyyy' at any point in the future will put you in a very strong position if anything goes wrong....

Good luck!

Cheers,

Itsallaguess

DiamondEcho
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Re: Direct Debit vs credit balance on utility a/c - what happens?

#140517

Postby DiamondEcho » May 22nd, 2018, 12:42 pm

Thanks, I appreciate all the replies. It’s simpler if I make a composite reply:
Alaric wrote: You would be gambling on the sophistication or otherwise of the direct debit system being operated. Perhaps it would be better to cancel the DDs and ask the recipients to specify an alternative payment mechanism. Council Tax used to be capable of being operated by paying in slips, perhaps that's still the case?

The difficulty with this is I’m abroad, returning to the UK end July, and my current UK bank is closing my bank a/c, on the basis that I live abroad, one month before I move back home, and nothing will change their mind [grrr!]. So that’s going to cancel all the current DDs. Also as our departure/relo date nears, past experience tells me things/issues/jobs are going to snowball very fast, comms will get patchy at the end; so I’m trying to pre-empt the ensuing chaos as best I can.

gryffron wrote:Why not just ring up and cancel all the DDs. Sure they'll be chasing you for the cash for 2 months. You can then find some other way to pay. They're unlikely to start issuing writs for 2 months, so no bad credit record. Or if you cancel earlier, you'll get the first demands before your personal shutdown, allowing you to either find out how to pay manually, or send the a cheque for too much which they can't partially reject. Gryff

If I’d a choice I’d prefer not to have to call at international rates and sit in ‘the usual’ long queue to speak to someone. From previous experience a simple call like that made in the UK can cost £20 from out here. From what you say, as things stand, perhaps I just let the DDs continue until the a/c is closed. That’s if my new a/c isn’t fully functioning by then - I don't know that yet. Given the billing is on a monthly cycle, between a/c closure [end June] and us getting back to UK [end July] any trouble might only be just beginning.
Thanks for the heads-up re: writs/time-frames. I hadn’t thought of it like that, ie. what action on their part impacts my credit record – I’d been thinking I had to avoid ANY missed payments.

chas49 wrote:-Can you get the relevant DDs set up on a friends a/c (and give them the funds) and then reset them on your own account when that's available?
-Allowing the DDs to bounce may affect your credit record...

-Another good idea, thanks. Unfortunately my parents are elderly and have offered to help, but it’d mean them driving to a physical branch 10 miles away and that’s asking too much of them I think. The younger generation are all ‘busy people’, and I don’t think they quite see the jam that I’m in. The one relative who could simply do it, her bank a/c is monitored by her husband’s employer and she doesn’t want anything unorthodox, or new, even this, going through it.
-Now I’m again concerned about having to cover all the DDs, rather than just prioritising say the mortgage and council tax...

Itsallaguess wrote:I think early-contact with all the organisations involved will keep any real issues to a minimum. [continues]

Ok, I think in conclusion to this^ and the other replies above I’m going to draw-up a list of DDs, prioritise them [mortgage>council tax>utils>?], and e-mail them setting out my circumstances and requesting their guidance. If I were to offer to pay say 3 months up-front, it might be harder for them to conclude I'm trying to shirk my bills. As suggested this situation can’t be that rare, and contacting them now shows willing.

Many thanks for all the suggestions, I appreciate it!

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Re: Direct Debit vs credit balance on utility a/c - what happens?

#140536

Postby gryffron » May 22nd, 2018, 1:30 pm

DiamondEcho wrote:If I’d a choice I’d prefer not to have to call at international rates and sit in ‘the usual’ long queue to speak to someone. From previous experience a simple call like that made in the UK can cost £20 from out here.

Fair. Then as I think you have already concluded, writing/email and explain the circumstances and where they can contact you for future payments would still be better than just doing nothing.

Gryff

chas49
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Re: Direct Debit vs credit balance on utility a/c - what happens?

#140551

Postby chas49 » May 22nd, 2018, 2:37 pm

DiamondEcho wrote:my current UK bank is closing my bank a/c, on the basis that I live abroad, one month before I move back home, and nothing will change their mind [grrr!].


Are you prepared to name the bank?

Have you gone through their complaints procedure? And/or tried a (reasonable) letter to the CEO? If you're a valuable customer, they ought to be able to find a way round the "rules".

Could you do a change of address to your parents and then to your new UK address?? Actually, if you're paying a mortgage and council tax, can't you use that address or is it rented out?

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Re: Direct Debit vs credit balance on utility a/c - what happens?

#140706

Postby DiamondEcho » May 23rd, 2018, 10:22 am

chas49 wrote:Are you prepared to name the bank? Have you gone through their complaints procedure? And/or tried a (reasonable) letter to the CEO? If you're a valuable customer, they ought to be able to find a way round the "rules". Could you do a change of address to your parents and then to your new UK address?? Actually, if you're paying a mortgage and council tax, can't you use that address or is it rented out?


I think it wiser not to name them until I've done my best to salvage the situation, it's unlikely UK banks monitor the likes of TLF for red flags, but who knows these days.
Once I get my new account up and running, hopefully within a week, and I'm no longer dependent on the present bank, then I'll be happy to come back here and outline the pretty shocking way that I've been treated.
Thanks for your suggestions, they know this kind of info and more, but I've run out of road. That they're aware I'm at material risk of having no way of paying my mortgage to their own subsidiary, despite which they've confirmed closure is a fait accompli means there is no turning this around.

So time to hurry and get the contingency plans activated as best I can.

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Re: Direct Debit vs credit balance on utility a/c - what happens?

#140816

Postby stevensfo » May 23rd, 2018, 4:57 pm

The difficulty with this is I’m abroad, returning to the UK end July, and my current UK bank is closing my bank a/c, on the basis that I live abroad, one month before I move back home, and nothing will change their mind [grrr!].


I've been abroad for 17 years and never had this problem. All they require is a UK address for correspondence. Couldn't you have given them your parents' address? Just a guess, but is it HSBC or Barclays? Banks that have been dragged into the spotlight for dodgy practices often seem to go through a cleansing ritual which normally involves kidding everyone that they're squeaky clean by being extra hard on their customers.


Steve

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Re: Direct Debit vs credit balance on utility a/c - what happens?

#140846

Postby DiamondEcho » May 23rd, 2018, 8:43 pm

I don't think they like where I live abroad - that is the one problem they have suggested is an issue.
I also don't think they like that I have declined a couple of times over recent years to subscribe to their [poor] stock-broking service. They've seen the material cash wires to/from another broker, so I know they are aware of roughly the business I do there, and they've given me the hard-sell on their broker before. But this is just a hunch, 'just another reason to be happy to be shot of me'?
But even when I demonstrated sufficient ties to the UK as requested by them and I thought I was thus ok (UK passport [born+bred], proof of UK property I own - that's available as my home presently, Uk council tax/util bills), they told me no the closure notice has already been issued. To be clear, a UK correspondence address wasn't the issue; it was where I am currently physically resident.

Either way, progress is being made, and just tonight I believe I'm another big step to getting out of this situation. Once I'm clear of it, AND here lol, I will elaborate more.

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Re: Direct Debit vs credit balance on utility a/c - what happens?

#140872

Postby mc2fool » May 24th, 2018, 1:39 am

stevensfo wrote:I've been abroad for 17 years and never had this problem. All they require is a UK address for correspondence.

You've been lucky -- at least so far. Either that or you've got what's called "private" banking, or your "UK" bank is actually in the Channel Islands or Isle of Man.

A UK address for correspondence isn't enough nowadays. When you give a bank a new address you need to be able to evidence that you live there. The normal evidence is being on the electoral roll at that address and having other services (landline, credit cards, other bank accounts, etc) in your name at the address. Those are normally checked electronically and if that fails you have to either turn up at a branch with your passport and utility bills etc or send in certified copies of the like.

Just a guess, but is it HSBC or Barclays? Banks that have been dragged into the spotlight for dodgy practices often seem to go through a cleansing ritual which normally involves kidding everyone that they're squeaky clean by being extra hard on their customers.

Maybe but actually the main event that prompted the Know your customer laws and increased anti-money laundering regulations was the 9/11 attack. The sort of KYC checks above have been around since 2003/4 and since then most banks have, in the end, decided that KYC is too difficult for non-UK customers, and so stop offering them the service (or push them off into their offshore branches).

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Re: Direct Debit vs credit balance on utility a/c - what happens?

#140878

Postby stevensfo » May 24th, 2018, 7:42 am

You've been lucky -- at least so far
.

I didn't know about the KYC rules. You're probably right. I have the usual bog standard bank accounts but still use the same address where my mother still lives, and having worked abroad many years ago and learned the hard way, I made sure to have as much correspondence as possible continue to go there, so no problem with showing bank letters etc. I take the view that, provided I am not doing anything fraudulent or evading taxes, then my action is justified. Having been treated badly and screwed around by banks in the past, my conscience is quite clear and I consider that I'm being a darned sight more honest with them than they have been with me.


Steve

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Re: Direct Debit vs credit balance on utility a/c - what happens?

#141308

Postby DiamondEcho » May 25th, 2018, 5:05 pm

Meanwhile I've got the new a/c activated, a friend with keys had to visit my home to collect my post and pass the details on to me, incl. activation code.
[They also sent a debit card AND it's PIN, unbeknownst to me, and the two letters were sitting there in the open mail slot for me in the entrance-way of the building].
Yesterday I made an initial funds transfer by BACS into the new a/c, just to get it in credit and ready for when payments vs it begin.
Tomorrow I'll check the a/c has received the credit, ie all the details are correct and the new a/c is functional.
Touch wood.

Then, I believe I'm eligible to use the 'Current Account Switch Service'. My current bank made no mention of this. I'll check whether I can use it this w/e. If I am eligible it might be ideal as it would mean all by DDs, and the credit balance, and any last-minute/and late credits will automatically be migrated to the new account. I really want to avoid having to migrate the DDs manually, telling the payees, them screwing it up (inevitably it seems, given the past few months experience).

Just noting this down in case anyone turns up who finds themselves in similar shoes.

mc2fool wrote:You've been lucky -- at least so far. Either that or you've got what's called "private" banking, or your "UK" bank is actually in the Channel Islands or Isle of Man.

[Highlighting the above comment so I hopefully remember to comment on it at a later time]

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Re: Direct Debit vs credit balance on utility a/c - what happens?

#141431

Postby DiamondEcho » May 26th, 2018, 9:53 am

Just a quickie: The bank transfer into the new account has credited, a huge relief for me. This w/e I'll be looking closely at the 'Current Account Switch Service' [CASS], and touch wood my present account is eligible for that.

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Re: Direct Debit vs credit balance on utility a/c - what happens?

#146736

Postby DiamondEcho » June 19th, 2018, 5:32 pm

Just to update on this situation.
I set up the Current Account Switch Service to deal with the transfer of my direct-debits/standing orders and any remaining cash balance into a new UK bank account. This was required as my former bank sought to close my a/c [see previous^], we'd been to and fro for months, despite which they had issued a summary Notice of Closure on the a/c, and I'd had to fly to London to urgently get a new/alt bank account set-up to transfer into. That required me to have all the documentation, ID, proof of UK address etc that Barclays had received but had suggested 'wasn't good enough'.The CASS process was set to trigger on 7-June. It supposedly takes about a week so I set that date hoping that would be sufficient time to fully complete before the threatened legacy a/c closure date of 22-June.

The CASS went ahead successfully, and completed on 15-June. I am hoping to soon see the required D-D's start to be drawn vs the new account. Ie I believe I have salvaged the situation just in time.

When I looked at the new bank account, I tried to reconcile the credit balance transferred over from the legacy bank but wasn't able to - unexpected as I run a tight ship on my personal accounting. Last night I received a letter from 'legacy bank', to tell me:
- They accepted my appeal, they 'need no more information', they have 'received all satisfactory documentation and were able to obtain an exception [to not close my account]'. Their letter is dated 7-June, the day the CASS triggered - and this after about 8-10 months negotiation/documentation/ongoing to-and-fro.
- The told me they had paid me £100 for inconvenience caused

That unexpected last minute £100Cr was why I hadn't been able to reconcile the balance transferred; ironic really. In summary after at least c8 months 'legacy bank' had finally accepted my circumstances, ID etc were sufficient, but on that same day my last-chance pre-set contingency plan activated. I'll be flying back to London next week again (US$850) for two days to collect my new bank debit card and PIN that a friend intercepted at my home address. I could try and claim this trip's expenses from 'legacy bank', but frankly feel that life is too short.

I'll disclose the names of legacy and new bank after we're permanently back in the UK in c6 weeks time. That's in case any other non-resident Brit here finds themselves going through this mill.


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