"Arrangement" on credit file

jimbo83

Guys/girls

I have an arrangement on my file which relates to an overdraft that has a latest staus of "2" - showing that i was 2 months late with a payment. I'm paying it off each month.

Once the balance is paid off, will it just show as a normal settled account wihout makng reference to the "arrangement"?

Also, will having an "arrangemnt" on my account affect my credit score in the meantime?

Thanks for any advice

Nikabella

I don't know what is supposed to happen but I know that my partner's Experian report still shows his accounts as 'Arrangement' with 'Settled' above it.

He had 6 defaults - 3 of which were then listed as 'Arrangements' I believe. In Jan 2007 used a lump sum to pay off all his debts as up until then he was making reduced payments that I had arranged with the creditors on his behalf. (The plonker had been using Gregory Pennington before he met me & paying £700 a year for their 'service'... I soon got rid of them!!)

So as far as I can see it seems that the 'Arrangements' will continue to show until the accounts fall off his report 6 years after default. I believe that 'Arrangement' does affect your credit score as it basically shows that you broke your original contract but I could be wrong as my partners file is ruined anyway due to the defaults.

This said I have still managed to get my partner a basic account from Natwest, a Vanquis CC, a Capital One CC, a Flybe CC & a Next account so my hard work seems to be paying off. You may be able to still get accounts like these, however, I wouldn't advise taking anymore credit out whilst you are still in debt of course!

jimbo83

Is an arrangement the same as a default?

The account only shows a status of "2" when i thought a default was "8"?

xgingerx

Hi, just got an idea i was thinking of !!!

Well if u keep on arrangement right upto you can manage the debts which should be very small by then, you could ask to come off the arrangement and start paying contractual payments, granted you may get some interest charged as normal but then you could get your account off the arrangement and then when you settle they will just be normal closed accounts, remember though that once you close them the last 3 years payment history will show

Just a thought, if like me you have a lot of debt I was working out that I could continue arrangements on the defaulted accounts as normal as these drop off my file in 5 years anyway and on the accounts not defaulted but on arrangement try to get in position where can come off arrangement and leave 3 years good history. Its difficult for me to explain but hope you get the idea

Nikabella

No, sorry if I confused you, an 'Arrangement' isn't the same as a 'Default'. A 'Default' does usually show "8", whereas "2" means you have only missed 2 months of payments rather than having defaulted on the account.

However, if your arrangement is for less than your minimum payment would be then I believe they can mark you account as defaulted as you have basically broken your contract by doing this. I think this is what happened to my partner, some of his accounts had not reached default (he hadn't missed enough payments) by the time he started on his arrangement but were marked as default in the end due to the arrangement being for less than the minimum payment.

I believe if you offer a Full & Final settlement at some point, if you are ever in the position to do this, then you can request that they remove the 'Arrangement' from your file once you pay them. Make sure you have this in writing before you pay though! Unfortunately we didn't know this back when we paid my OH creditors off.

One of my partners credit cards I believe never went to default, however, went to arrangement once he started paying below the minimum payment. Towards the end of the arrangement before I paid them off in full we started paying over the minimum payment, however, I'm pretty sure the account still shows as arrangement (but settled) so I'm not sure xgingerx's suggestion will work. I'm not 100% though & am happy to check this for you if it helps.