Why you should avoid overdrafts and the heavy interest rates?

mybithdaye By mybithdaye, 1st Oct 2012 | Follow this author | RSS Feed
Posted in Wikinut>Money>Debt

Just was surfing about the facility given by bank and I came by overdraft facility. So here is my research on this facility to you all...

Overdraft cannot be fruitful always!!!

Well let us start with the meaning of overdraft. When you don't have enough funds in your bank and you wanna withdraw more money, then your balance goes negative for which you have to pay high interest later, this facility is called overdraft. But everyone should try their best to avoid this overdraft facility by contacting the respective bank. It seems so good like a loan for which you don't need to do any paper work but this overdraft policy can land you in serious trouble for you to regret. Let me explain with an example, you have just 1 dollar in your bank and you try a service which you need to cancel. And if you fail to cancel, heavy monthly charges would be applicable. And you think you have just 1 dollar, you forget to cancel and the monthly charges are charged to you with overdraft facility. Now you are charged and had to pay back to bank with heavy interest. It is now a confusion for you whether this overdraft is good or bad. It is good in many cases like if you want some quick funds without asking anybody which are going to be credited back in sometime later. But many times overdraft occurs with ignorance or you allow some fraud company and they charge you with overdraft. So considering positives and negatives of overdraft which leads to heavy interests or sometimes huge loss, it is highly recommendable to avoid overdraft to be on safer side. Whenever possible try to avoid heavy interest on any kind of loan, it always leads to problems because heavy interests can give really heavy headache. Overdraft is a good facility but when ignored by you can give trouble to you. And it is a very important tool used by fraudsters to make you bankrupt to an extreme. Keep yourself happy, be secure without overdraft and heavy interest.


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