Credit default - withdrawal from loan

[houndsman]

Evening all

I wanted some advice on a default which has been on my credit file from three years ago.

Long story short - I took out a payday loan in 2016. I subsequently obtained money from another source and withdrew from the loan agreement within 14 days of the agreement date as permitted by the consumer credit act right of Withdrawal.

for whatever reason, I was unable to, and did not repay the sums borrowed + interest 30 days from withdrawing

the payday lender subsequently issued a notice of default against my credit file some months later.

This is now obviously massively impacting my credit file but I wanted to ask:

- notwithstanding that I owed them money and the original loan amount was not repaid (foolishly), what is the effect of the withdrawal from the loan and credit agreement? Are the payday lender still permitted to report this against my credit file if I withdrew from the agreement?

appreciate that there remains a debt outstanding but is that debt still one that should have been reported to the credit agencies?

any guidance would be much appreciated!

[Amethyst]

Yes - the credit file reflects the true situation - a debt was obtained and the terms on withdrawal were that the loaned amount was repaid ( probably a term for daily interest in event of withdrawal too ) and the cancellation would likely only have taken effect upon the full repayment of the borrowed monies.

[houndsman]

Thanks Amethyst.

would they have had to still serve a default notice before reporting as a default, even though the loan agreement itself was withdrawn from? I.e. is it still a regulated cca agreement? I did not ever receive a default notice before this was registered on my file

[Amethyst]

Default notices and Default markers on credit files are not directly linked I'm afraid.

Default Notice gives you notice of their intention to call in the full debt if the arrears are not brought up to date by a certain date and is required under s 87 Consumer Credit Act 1974.

Reporting to Credit Reference Agencies only requires the information reported to be accurate. If payment wasn't made under the terms of the agreement ( so repayment within 30 days of the cancellation/withdrawal from the agreement by the sounds of it, ) then they were correct in marking you as having defaulted. From their side you took out a loan, had the money, cancelled the loan, never repaid any of the money. To accurately reflect that on your credit file it would show as a default marker. I believe they should have written and asked for repayment of the loan due to the cancellation/withdrawal with a warning that repayment past a certain date would incur a default marker on the credit file.