Q&A: How to reclaim bank charges
Can I get my charges back?
Not yet. Today’s appeal court ruling just allows the Office of Fair Trading (OFT) to investigate the charges – it has to decide if they are fair and, if not, what level of charge would be lawful. It also needs to decide whether the banks will have to actively return money they have charged over and above that amount, or if consumers will have to request a refund.
What should I do while I wait?
If you have paid overdraft charges since 27 July 2001 you should send a reclaim letter to your current account provider requesting a refund, even though you won’t get an immediate response. The Financial Services Authority (FSA) has granted banks and building societies a waiver allowing them to sit on these letters until the case is over. But if you write now your complaint will be in the system, which should mean it is one of the first to be dealt with.
Should I instruct someone to handle my claim?
Some firms promise to recover charges on a “no win, no fee basis”, but these can take up a big chunk of your compensation. It may seem appealing to let someone else do the legwork, but you can make life easier by downloading a template letter to fill in. These are available from guardian.co.uk/money, or from Which? or MoneySavingExpert.com.
I am struggling financially. How will I cope while the waiver is in place?
The FSA’s waiver does not apply to reclaim letters from consumers in financial difficulty, which it defines as someone whose income is not enough to cover reasonable living expenses as well as their bills. If you are in this position you should indicate this in your letter as your current account provider is obliged to identify and deal with claims from people in difficulty. You can’t just claim to be having problems to bypass the waiver – the bank will check your circumstances.
I am waiting to hear about a claim I made last year. What should I do?
Wait some more. Your claim is in the system, but while the waiver is in place your bank will not have to do anything.
How far back can I reclaim charges?
Usually there is a six-year legal limit on claims, but when the FSA put the waiver in place on 27 July 2007 it effectively put a freeze on refunds. This means you can claim anything paid since 27 July 2001.
Will I get all my money back?
It seems unlikely. While consumers who reclaimed the fees before the test case were able to claim all their money, it seems likely that those who get payouts in future will only receive the difference between the maximum charge imposed by the OFT and the amount they originally paid. Reclaiming will not be as lucrative as it once was.
I claimed previously. Can I do it again?
If you claimed for charges and were successful you cannot do so again, but you can write and claim for any charges incurred since then. If your original appeal was unsuccessful you will be able to go back to your bank after the OFT ruling to ask for that money again, but only if your original claim did not go to court and you did not reach a settlement with your bank.
Need a Loan? Visit Secured Loans Broker.
