Coping with defaults on your credit record

rosalind110

Good morning,

My personal circumstances, and the fact that I was trying to cope with debts someone else had left me, have resulted in my receiving three default notices and some late payments in the past eighteen months. All of these debts are now paid up in full, and I currently have no bad debts at all, but the default credit score of '8' for each incidence remains on my credit record and will do so for six years which means that my score will stay as 'very poor' for that length of time also.

Unfortunately, I now need to borrow £5000 - I wish I didn't have to, but it is unavoidable - and the only companies who will offer a loan, even a secured one, want 35 - 40% interest which just isn't feasible. Can anyone tell me how and where I can improve on this situation please? I really DON'T want to get into further bad debt as life is almost impossible financially as it is, but I can't see a way out of the maze at the moment!

Thanks for your help.

Ros

rushnowt

Hiya Ros,

Sorry to hear about your circumstances and congratulations on sorting it all out now  ;D

If all the debts are completely cleared now i'm sure you should be able to contact experian and equifax and ask them to remove anything derogatory on your credit file or at least make a note that you are now debt free and all outstanding amounts have been cleared. I'm sure there are others on here though far more qualified than I that will be able to give you far more info. So bare with it. They'll come to your rescue I promise  ;D  ;)

deemy2004

An alternative is to get someone else who has a good credit rating to act as a guarantor for the loan.

As things are banks are getting and are goign to get a lot tougher in their lending criteria during 2005.

Debt_Free_Chick

Hiya Ros,

If all the debts are completely cleared now i'm sure you should be able to contact experian and equifax and ask them to remove anything derogatory on your credit file or at least make a note that you are now debt free and all outstanding amounts have been cleared.

You're right, in that the debts will now be shown as "settled". Unfortunately, the defaults will not be removed. They are there as a warning to other lenders that the account was conducted in a less than perfect way.

Sorry Ros, but your defaults will remain for 6 years. Ignore any companies who claim to clean up your credit record for a fee - this cannot be done. Whatever they do, you can do for yourself, but the defaults will not be removed.

Ros - you should get a Letter of Satisfaction from each of the previous lenders to confirm that the debts have been settled. You could try sending this to new lenders, but I doubt it will change the position. It's the defaults that are driving the high interest rates offered so far.

Debt_Free_Chick

Good morning,

I really DON'T want to get into further bad debt as life is almost impossible financially as it is, but I can't see a way out of the maze at the moment!

Thanks for your help.

Ros

Ros this should ring alarm bells with you. If your finances are already tight, are you sure you can afford a loan?

Have you worked through Martin's budget on this site and looked at ways of reducing your current expenses? And must you really get into debt? You say you want to borrow £5,000 but when you add interest on, you'll be borrowing much more than that - even if you could get a better rate of interest.

Remember, you cannot borrow your way out of trouble. If you post more details of why you need £5,000 we may have other suggestions. You might prefer not to do this, but the offer is there.

Good luck