Kill o/d and setup new one or just reduce this one?

[Flatshift]

I've had a rather large overdraft hanging over me which I am now in a position to repay, and will be. However, I want to have a buffer of say £200 to cover any unexpectedness.

Question is do I clear the current o/d and later set up a new one, or just reduce it to what I want it to be? Is there one that is better or worse in the eyes of my bank?

[walm]

Paying off the overdraft won't remove your ability to go overdrawn (unless the overdraft you have now is unauthorised in which case pay it off RIGHT NOW).

So you will still have the buffer.
Pay it off.

In the eyes of the bank, their bottom line would prefer you to keep paying interest.
BUT if you want another loan, then the bank prefers you debt free.

[v15ben]

Also if you are paying the full overdraft off, ask about refunds of a charge or two. I guess the bank will have thrown a few charges at you while you've been in the overdraft so it's always worth having a go.

[Flatshift]

Thanks guys, I thought that was going to be a tumleweed moment there.

I think I will have a £0 o/d and if I accidentally go o/d I will ask to set up a very small one.