A credit facility on the checking account is a nice thing. But this can also quickly lead to overindebtedness. Although the positive aspects predominate, the overdraft facility should be used with caution. The account holder should also not forget that an overdraft facility is very expensive. It is only worth using this if it can be quickly compensated for.
When the disposition is exhausted
Many use their overdraft facility in full. Some even overshoot the target and exaggerate more than is allowed. In some cases, banks accept this tacitly, up to a certain amount, which the account holder cannot see. The bad awakening then comes with a letter from the bank with the kind request to get in touch with the clerk.
During this interview, the bank’s employee will make a proposal to take out a credit for the overdraft facility. This makes sense because it saves the borrower interest. But there are also dangers here.
Anyone who has taken out a credit for the overdraft facility has no more worries at first. However, the banks mostly leave these customers the overdraft facility without reducing or even canceling it. This is exactly the risk, because this will seduce the account holder into using the overdraft facility again. This puts him in the same situation as before. What follows is a loan increase to offset these debts again.
This results in overindebtedness. Many households are now affected by this. To prevent this situation from occurring in the first place, the account holder should refrain from using a credit for the overdraft facility, at least until the loan has been paid off. The banks, however, do not like to hear this because they earn a lot of money from overdrafts.
Only if the child has already fallen into the well do they cancel the overdraft facility without replacement. Then it is usually too late. Only those who have their finances in view should use the overdraft facility. For everyone else, it is only a great seduction.