Can I remove a default from my Credit File

[Vagabond_UK]

A few years ago, I had a basic bank account with Abbey (now Santander) which I wrongly assumed had been closed. However, after a bank charge on the account, it slipped into unauthorised overdraft and began to accrue a negative balance.

After the arrears had reached £100 Abbey passed the account to Moorcroft, registered a default on my credit file and from there I repaid the outstanding balance at an agreed sum each month. It was cleared in March this year, and having checked my credit report I saw that there was seemingly a £10 arrears still marked.

I've queried this with Abbey who say the account is clear and they will mark the default as satisfied. But I would like to know if I could have it removed?

The account in question wasn't a credit-bearing account; ie, there was no overdraft attached to the account, no cheque guarantee or any other facility - simply a basic account with a debit card to use at ATMs and shops. Nothing else. As such I don't see how such an account can come under jurisdiction of a credit agreement and such affect my credit report. Plus, i can't recall ever having received a default notice from Abbey regarding the account.

The default wasn't for a huge amount of money - £130. But it was registered in June 2009, so won't drop off my report until 2015.

Is there anything I can do to try and have Abbey remove the default, or am I stuck with it until it drops off on its own? What effect will a satisfied default have on my getting credit in the future?

Thanks.

[shamen]

Re: Can I remove a default from my Credit File

Technically they could be within their rights to leave the default on your credit file, however I would suggest writing a letter of complaint to the bank about not being told about the default and the fact that it was all made up of charges. Additonally, if the charge was for a bounced direct debit or cheque, they are unfair charges in the first place.

My wife had a bank account she forgot about (left it in credit by a small amount) which a bank charge then put it £1.50 overdrawn (halifax). They they started their £5 per day charging until the balance was over £250, registered a default and sent it to a debt collector. They did not send anything out until they reached the £250 mark as the account was 'paperless,' so without her logging into online banking she had no idea that the account was even overdrawn

After complaining about the situation that a simple error had led to near £300 in charges (after the DCA tried to add their fee), a few letters went back and forth but eventually the agreed to write off the amount and clear all records of it from her credit file.

If you received no communication (for example, postal statements and such) then your complaint has good grounds I would think. If the original charge was 'unfair' anyway then your grounds are even stronger. Personally I would be talking to them along the lines of "this default was made up completely of unfair charges which resulted from an unfair charge. I thought I had closed this account and it was not in a negative balance when I had done so. The only reason it had a negative balance is because you levied an unfair charge. You gave me no notice of any overdraft, default or growing negative balance. I have paid off the balance and am not at this time looking to pursue recovery of the unfair charges. I would like to ask that as a gesture of goodwill you remove the adverse remarks about this account from my credit reports."

Of course, you could always launch a claim in court for the whole amount back, including original charge and all the payments you made if they were 'unfair' . If you win that, they should remove the default as there was no legal basis for it in the first place. see http://www.legalbeagles.info/forums/showthread.php?t=23

Theres also the ombudsman roure

[Caspar]

Re: Can I remove a default from my Credit File

As above I suspect they are totally within their rights to leave it there, and Santander are not known for their helpfulness.

I have no idea where I came across this, but I saved it to my computer. Apologies if the original writer reads this post, I would attribute it if I could, it may help:

How to remove Default Notices

Introduction

In addition to county court judgements (CCJ's) you may find that you have had default notices or termination notices written on your credit file obtained from the credit reference agencies.
Default notices and termination notices are simply a record that is placed on your file normally by banks and building societies or other financial institutions.
Signed Declaration

Whenever you take out a loan or hire purchase agreement you sign a declaration stating that you agree that should you not keep up your payments in any way then the bank or other financial institution has the right to inform the credit reference agencies of your default etc.
This could be due to late payment or a query over the payment. These notices that are placed in your file are nothing to do with the county court. They are simply a way of alerting other finance companies that you are in default against some other finance company.
Remember this is something that you have agreed to allow the banks etc. to do when you took out the loan. It is therefore their right to place these notices on your file without consulting you or a county court.
The only way to have these removed is by applying to the company or bank that served the notice on your file in the first place. In order to do this you will need to check through your credit file returned from the credit reference agency as to who actually placed the notice on your file. Once you have done this you should contact the people who placed the notice to see if you can come to any kind of arrangement.
They may be willing to do this in any of the following situations;

1. The default notice was served but the payments have been brought up to date
2. The loan has now been totally repaid
3. The payments are still in default but you have come to an arrangement with the finance company
4. You totally disagree with the default notice etc. being served, as you think they have been placed on your file incorrectly
In any of the above cases you should write to the finance company and ask if they would be prepared to remove the notice from your file. If they do agree then you need to get them to put this in writing to you.
They may write and ask you to pay an administration fee for this, or they may write and ask you to bring repayments up to date etc.
Once they have written and agreed that you no longer owe them any money, or that they are happy with the revised repayment schedule that you have now agreed, you can then send a copy of this letter to the credit reference agencies who will then be able to remove the default, termination notice, etc. from your file

[Vagabond_UK]

Re: Can I remove a default from my Credit File

Still badgering Santander about the possibility of removing the default, but they're not for budging so far..

However, Equifax have sent me a status update that Santander have changed the status of the account from D(Default) to S(Settled). Is this better, worse or no different to 'Satisfied'?

What, if any, impact will this have on my credit file and score?

Cheers.

[The Debt Star]

Re: Can I remove a default from my Credit File

FWIW I would complain to the FOS on the basis that the default is unfair, not on the basis that it is technically justified.

I had an HSBC default ref my current account successfully removed, despite a lot of peeps telling me it wasn't going to happen.

SAR the bank, find out whether the charge was justified and get some background into it. The fact that they added charges on top of charges may give you some leverage.

[Vagabond_UK]

Re: Can I remove a default from my Credit File

After a complaint/plea to Santander's CEO, I've just checked my credit file through Equifax and it appears that the default has been lifted as there is now no defaulted information shown.. I've also checked it through Noddle (Callcredit - early adopter) and its not even listed on there.

I've yet to receive written confirmation from Santander though, so I'll wait until I get that before celebrating a win over the big boys, however small.

Now I just to settle one account-in-arrears (cleared this month) and wait for my 5-year old default (T-Mobile via DCA - gone awol, stopped taking payments) to drop off next year and I'll be clean.

[shamen]

Re: Can I remove a default from my Credit File

Congrats mate Sometimes writing to them and putting the position across can help, looks like you got lucky.

Are you currently a customer of Tmobile? It may be worth writing to their CEO and asking something along the lines of 'as a gesture of goodwill can you remove the default from 5 years ago as so long has past, I operate much more responsibly with finances and this one mark is holding me back.' or words to that effect.

Its worked with me many years ago but ive not tired that one in over 10 years at least.

[Vagabond_UK]

Re: Can I remove a default from my Credit File

Congrats mate Sometimes writing to them and putting the position across can help, looks like you got lucky.

Are you currently a customer of Tmobile? It may be worth writing to their CEO and asking something along the lines of 'as a gesture of goodwill can you remove the default from 5 years ago as so long has past, I operate much more responsibly with finances and this one mark is holding me back.' or words to that effect.

Its worked with me many years ago but ive not tired that one in over 10 years at least.

No mate, I'm not a Tmobile customer anymore and haven't been for several years.

This default came about due to roaming charges while I wife was abroad. Every text message she sent me was being treated as a call and so was being charged at their international rate. The bill racked up to over £300 which I couldn't pay off in one go so Tmobile defaulted it and sent it to a DCA.

I was paying the default off at a few £££ per month, and now the balance is just £44. However, the DCA stopped taking their payment in August last year, and now I don't know how to pay the rest as Tmobile say they can't take the balance as the account was sold, and the DCA sends back the money if I try to pay them. It seems that I can't pay this debt off, as no-one is taking responsibility for it.

I would ask, but I reckon so long as I have this balance over me, I've little chance of getting this particular default lifted. Still, it drops off in Nov 2012 so not too long to wait...

[shamen]

This default came about due to roaming charges while I wife was abroad. Every text message she sent me was being treated as a call and so was being charged at their international rate. The bill racked up to over £300 which I couldn't pay off in one go so Tmobile defaulted it and sent it to a DCA.

Interesting - thats a big no no under ofcom rules. You must be billed correctly for the service used. Do you have any statements showing the charges? They can charge more for international texts while roaming, but you would have to send hundreds, if not thousands of texts to get to over 300 quid. If the debt was due to their billing error in the firstplace, then the default on your credit file is very likely 'inaccurate data' under the Data Protection Act.

I would ask, but I reckon so long as I have this balance over me, I've little chance of getting this particular default lifted. Still, it drops off in Nov 2012 so not too long to wait...

I would ask, it wont hurt and if tmobile have sold the debt they wont care. After all this time you likely wont even be in Tmobiles system - my old default with them disappeared from their systems after 3 years and when I wrote and asked them to remove the default on my credit file, they could find nothing in their system to corroborate the default so removed it as a 'gesture of goodwill'. If they write back and say no, then nothing lost. Its worth the letter.

Do you know which company has registered the default on your file? Is it tmobile themselves or is it the DCA?

Something else worth noting - they are giving you no way to satisfy the debt. No one is taking payment, and thus you will never be able to have the default marked as 'satisfied' on your report, which could leave them (the comapny actually recording the default in your CRA file) open to complying to a DPA section 10 notice.

Try writing first, see what they say. You really have nothing to lose.

[Vagabond_UK]

Re: Can I remove a default from my Credit File

Interesting - thats a big no no under ofcom rules. You must be billed correctly for the service used. Do you have any statements showing the charges? They can charge more for international texts while roaming, but you would have to send hundreds, if not thousands of texts to get to over 300 quid. If the debt was due to their billing error in the firstplace, then the default on your credit file is very likely 'inaccurate data' under the Data Protection Act.

I would ask, it wont hurt and if tmobile have sold the debt they wont care. After all this time you likely wont even be in Tmobiles system - my old default with them disappeared from their systems after 3 years and when I wrote and asked them to remove the default on my credit file, they could find nothing in their system to corroborate the default so removed it as a 'gesture of goodwill'. If they write back and say no, then nothing lost. Its worth the letter.

Do you know which company has registered the default on your file? Is it tmobile themselves or is it the DCA?

Something else worth noting - they are giving you no way to satisfy the debt. No one is taking payment, and thus you will never be able to have the default marked as 'satisfied' on your report, which could leave them (the comapny actually recording the default in your CRA file) open to complying to a DPA section 10 notice.

Try writing first, see what they say. You really have nothing to lose.

So I wrote to them and explained the situation..

.. and its a halfway house in that they are not going to remove the default but they will waive the existing balance due to the difficulties I have experienced and mark the default as settled.

Not what I had hoped, but the settlement should hopefully help and it drops off in just over a year anyway. My other account that is in arrears will also be clear as of 29th July.

So how will these 'settlements' work? I assume the past payment history of the arrears account will still affect me negatively, despite it now being settled (was never defaulted, just in arrears).

And the now-settled default, once marked as settled will it still affect me as much now after 5 years as it did when new, or is its effect diluted over time?

[shamen]

Re: Can I remove a default from my Credit File

Was worth a try, but at least you have less debt now

Was this done via email with customer services? It may be worth doing a written letter to the CEO's office and put your case forward?

So how will these 'settlements' work? I assume the past payment history of the arrears account will still affect me negatively, despite it now being settled (was never defaulted, just in arrears).

A settled default is a bit better than having an unsettled default if your credit report is being examined by human eyes. Its still a default though, but at least it is shown that you satisfied the account and its no longer in arrears. It is definitely better to have a 'settled' default than an unsettled one, but not by much. Most lenders will still see it as a default, regardless of status, especially if automatic credit application processing is in use by the lender/provider.

However, you say they never defaulted you and its just arrears - thats very unusual for something from so long ago. It would be odd for them to just be marking your credit file as 'late payment' for 5 years. Are you 100% sure its not a default on your file? The reason I ask is that if your account is 'active' and just has 'late payment' markers on the credit file, those will stay on for 6 years from the last notification - so if they did not default you and applied a late payment marker on last month, its my understanding that marker will stay on there for a further 6 years from last month.

Can you post a screen grab (removing any personal details) of this particular entry in your credit report?

And the now-settled default, once marked as settled will it still affect me as much now after 5 years as it did when new, or is its effect diluted over time?

It will drop off after 6 years of the original default date. Settling the default does not change the default date, it just changes its status.

[Vagabond_UK]

Re: Can I remove a default from my Credit File

To say I'm a bit ****ed with T-Mobile at the moment is an understatement, having renewed my monthly credit report to show that the T-Mobile debt has been wiped.

HOWEVER, they have moved the default that was originally assigned in Dec' 06 to the period where the payments stopped getting taken by their agent, marking the default as September 2010! In settling the outstanding balance, they've basically wiped out 5 years worth of payment history in order to extend the default.

This is my report as it appears on AnnualCreditReport (CallCredit, taken this morning)




And Equifax (Taken this morning)

[shamen]

Re: Can I remove a default from my Credit File

Tmobile have no right to 'alter' a default date.

If the default date was marked as December 2006, then it should remain as december 2006. i would get a recorded delivery letter off to the CEO's office informing them that they have incorrectly updated your credit file and moved the default date from December 2006 to September 2010. Ask them to confirm the correct date your account was defaulted.

If that fails to work, then I wold recommend pursuing this through the data protection act, as well as get a full data protection act subject access request from tmobile to see that actual paperwork they have on file (this should support your case).

As a sideline, id advise disputing the entry with equifax, ask them why the default was marked in 2006 has recently been changed to September 2010, as you understand that default dates cannot be moved.

[Vagabond_UK]

Re: Can I remove a default from my Credit File

Yep, I've already raised a dispute with Equifax re: the change in information... I'm currently at work, so I'll be digging the T-Mobile response out and drafting a letter off when I get home.

And now I've refreshed my CC/ACR file to see they are reporting the information differently to Equifax and still have the original information, but show the default being settled in Sept. 2010???

[Vagabond_UK]

Re: Can I remove a default from my Credit File

I highlighted the incorrect information with TMobile.. their response.

"As states in my previous letter, the payment history on your credit profile is a true reflection of your credit profile and the default will not be removed. When an account goes to a debt collection agency, the default is not immediately applied as we have to give our customers time to pay."

Completey misses the point of my response. However, it seems they are of the opinion that the record is correct - although they don't say which one!

I don't believe they can simply erase parts of the account's history and move a default registered in 2006 to 2010! They would surely have had to terminate this account and issue a new default under S87?