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Overdrawn? You can tell your bank how to use money that comes in



Did you know that we all have the right to say how money paid into our bank account is used?

Most people don’t know this. If your bank account is overdrawn, you can tell the bank not to use money going into your account to reduce the level of your overdraft. Instead, you can use this money to pay for bills, rent etc first.

This is called the 'First Right of Appropriation'.

How do I set this up?

You will need to contact your bank or building society and let them know, in writing, that the payments being made into your account are to be used to pay for specific items, which you will need to list. You can even set this up if the bank has already used your money to reduce the overdraft, and can ask for a full or partial refund.

What do I need to say in my letter?

In your letter, you will need to include your account details, name and address, the amount being deposited and on what date the money will be paid in. You will need to formally request that you want to exercise your ‘first right of appropriation’ and to mention what essential bills you need to cover, how much, on what date and for how long. We recommend you send your letter before a deposit is made and to keep a copy just in case.

Here's an example letter

Creditor name and address:
Account/Agreement No:
Your name and address:

To whom it may concern,

I wish to exercise my first right of appropriation.

A payment of £___ will be paid into the above account on (date).

The account is currently overdrawn. However I need the money to meet my living costs, utilities and rent payments over the next week.

I want to use the ‘first right of appropriation’ to reserve the £___ for this purpose and will withdraw the sum of £___ on (date) in order to do so.

I’ll contact you separately to make an arrangement to reduce my overdraft.

Yours faithfully,

(Print name)

Have any questions? Need help? Contact our friendly Customer Accounts team who will help you through this process.

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