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Default removal

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I’m in the process of trying to repair my credit rating and was after some advise.

I have 7 defaults of my account. I have checked my Experian record.

Experian state that defaults are removed after 6 years, paid or not so does this mean my credit rating will improve? And they will be removed like it never existed???

Also, I have some defaults that are almost at the 6 year mark and therefore should be removed soon. Is it really worth paying them if they will be removed anyway?

And final question. The defaults that are not nearing removal, none of them are in dispute, I read about trying to negotiate with the lender though that if I agree to pay then they remove the entry on my credit file.

I was just wondering how this works and what assurances I should get from the company before I part with my cash.

Thanks for reading

Comments

  • stuartmck
    stuartmck Posts: 260 Forumite
    Part of the Furniture Photogenic Combo Breaker
    Defaults are removed from your credit file 6 years after being issued - whether or not you pay them. It is my understanding that they do not affect your rating after that time. If you pay the lender then the default is marked as 'satisfied' on your account, but it still isn't removed until the 6 years have passed.
    In need of a new signature! :rotfl:
  • brians_daughter
    brians_daughter Posts: 2,148 Forumite
    edited 16 June 2009 at 4:12PM
    maximoomoo wrote: »
    I’m in the process of trying to repair my credit rating and was after some advise.

    I have 7 defaults of my account. I have checked my Experian record.

    Experian state that defaults are removed after 6 years, paid or not so does this mean my credit rating will improve? And they will be removed like it never existed???

    Also, I have some defaults that are almost at the 6 year mark and therefore should be removed soon. Is it really worth paying them if they will be removed anyway?

    And final question. The defaults that are not nearing removal, none of them are in dispute, I read about trying to negotiate with the lender though that if I agree to pay then they remove the entry on my credit file.

    I was just wondering how this works and what assurances I should get from the company before I part with my cash.

    Thanks for reading
    They drop off after 6 years regardless if paid or not

    - is it worth paying them? Thats a question of morals

    you can negotiate i did for my little brother last year he got a default but was in and out of hospital with a very serious illness, in hospital 5 months solid. All his bills where dd except 1 which he forgot about due to all that was going on. i helped him write to the credit company involved and sent medical apps etc and as he has been a customer for 12 years and never missed a payment up to when admitted to hospital and they removed the default. The agreement we had was they would remove the default and write to him to say it had been done then he would pay the balance owing within 7 days or else the default would re enter on his credit profile. it depends on your circumstance, i would like to here of ppl who got them removed with not a 'good' reason ie severe ill health almost dying as i have one from 04 when i was made redundant
  • GeorgeUK
    GeorgeUK Posts: 7,737 Forumite
    If you have not made any payment towards a debt for 6 years (5 in Scotland), or acknowledged the debt in writing during that time, then the debt will be statute barred. If this is the case, then the debt although it will still exist will be unenforcable. They could ask you to repay the money on a statute barred debt, but that's all they could do - if they tried to take you to court your defence would be that the debt is statute barred.

    If not statute barred and you wish to make a settlement offer, you would need to make sure you got written confirmation that it was a full and final settlement - not partial. You should also get them to state that your will no longer be liable for the remainder of the debt.

    For F&F settlements, if the debt is with a CCA then you could pay 25%-50% of what's owed.
    After falling off the gambling wagon (twice): £33,600 (24,000+ 9,600) - Original CC Debt: £7,885.91

    Dad Gift 6k ¦ Savings & Inv Tst: £2,500
    Loan 10k: £0 ¦ Dad 5.5k: £2,270 ¦ LTSB: £0 ¦ RBS: £0 ¦ Virgin £0 ¦ Egg £0

    Total Owed: £2,270 (+6k) 11/08/2011
  • never-in-doubt
    never-in-doubt Posts: 20,613 Forumite
    maximoomoo wrote: »
    I’m in the process of trying to repair my credit rating and was after some advise.

    I have 7 defaults of my account. I have checked my Experian record.

    Experian state that defaults are removed after 6 years, paid or not so does this mean my credit rating will improve? And they will be removed like it never existed???

    Also, I have some defaults that are almost at the 6 year mark and therefore should be removed soon. Is it really worth paying them if they will be removed anyway?

    And final question. The defaults that are not nearing removal, none of them are in dispute, I read about trying to negotiate with the lender though that if I agree to pay then they remove the entry on my credit file.

    I was just wondering how this works and what assurances I should get from the company before I part with my cash.

    Thanks for reading

    Try this - see how you get on.


    Letter to send:


    Dear XXXXXXXXXX,

    Ref: XXXXXXXX

    I write with reference to previous communication regarding an outstanding balance on the account and wish to make an offer to resolve that will suitably please both parties.

    I do have an outstanding balance on the account, as you are fully aware this is made up primarily of charges. However, a default to you and no payment will not achieve much and so I therefore write to try and resolve matters amicably, that will suit both of us long term.

    I propose to offer a full and final payment to settle and close this account to the value of 50% of the original amount, which will take into account and absorb, a lot of the charges that have been added to the account throughout time.

    The alternative is for me to place the account formally into dispute and demand s.10 CCA (1974) is brought into play (cease & desist) whilst I reclaim all unlawful charges combined with all costs. I shall then look at the legality of the assignment of debt; the issuance of a default notice and the agreement (prescribed terms) and between them, i'll probably be able to counter sue and litigate over unenforceability.

    To confirm, I am more than happy to settle as much as 50% of the total amount owing so long as you can agree to, and ensure that, the following actions will be carried out;
    • The Default Notice will be removed
    • The Status of the account will change from “Defaulted” to “Settled”
    • The Current Balance will appear as £0.00
    • The Default / Delinquent Balance will be set to £0.00
    • There will be no date in the “Defaulted Date” field (as it will be removed)
    • There will be no date in the “Date Last Delinquent” field on the report
    • This will apply to all 3 Credit Reference Agencies, namely Experian, Equifax & Call Credit
    If you're happy with my proposal, please respond confirming each of the above points on official letterheaded paper, confirming the exact amount owing and I will send a cheque by return.

    Failure to agree will result in more formal papers being sent, by return.

    I look forward to your response.

    Yours faithfully,

    Sign here digitally
    :o 2010 - year of the troll :o

    Niddy - Over & Out :wave:
  • I have read this thread with interest as I have just learnt the RBS have placed a default on my account, with a balance of £996.

    I moved house in January 08 and sent the branch a letter advising them of this, it would seem they never received my letter and as the account was inactive, other than me paying in £10 per month to pay off an outstanding overdraft, I did not query not receiving statements as I had online banking and the account was pretty much inactive.

    I found out the default had been placed on my account because I logged on to Equifax and got my credit report. I immediately phoned the bank and arranged a repayment schedule of the balance. I then wrote to the bank to explain the situation and ask that the default be removed from my account, I was not aware the account was over its overdraft limit and had not been receiving any statements/letters from them.

    I have now received a response which was quite rude and basically tells me the default is correct and will not be removed. They also attached statements from September, when the account went over its limit of £550, the remaining £450 of the default balance is ALL charges!! From what I have read I believe the letter in the thread will apply to me, but am quite nervous about the banks response.....anyone that has used the letter, I would appreciate hearing what happened...

    Many thanks
  • GeorgeUK
    GeorgeUK Posts: 7,737 Forumite
    Michelsea, never used the letter but it might be worth sending the bank a subject access request (cost £10)

    This SAR will enable you to receive a copy of all data held on you by RBS - this will include transaction information (so you can work out how much you can reclaim from unlawful charges) and documentation (which should include the default notice).

    There are others on the board with more knowledge of defaults but if the amount they have defaulted you for is incorrect (due to unlawful charges), you could argue that the default is also unlawful. If a default notice was never sent then the default should not have been placed on your file.
    After falling off the gambling wagon (twice): £33,600 (24,000+ 9,600) - Original CC Debt: £7,885.91

    Dad Gift 6k ¦ Savings & Inv Tst: £2,500
    Loan 10k: £0 ¦ Dad 5.5k: £2,270 ¦ LTSB: £0 ¦ RBS: £0 ¦ Virgin £0 ¦ Egg £0

    Total Owed: £2,270 (+6k) 11/08/2011
  • Thanks GeorgeUK, I'll do that. I agreed to pay them £200 per month to pay the balance off, so I'll pay this months and hopefully will have received something back from the bank before the next payment is due.
  • I sent the letter off and have receievd the following back, any help as to how i proceed would be gratefully received:

    'Dear Miss King,

    We write with reference to your recent correspondence dated 26 June 2009.

    Please confirm the amount that you are offering in full and final settlement of the above accounts.

    We reply to the points in your letter as follows:

    1.The default notice will not be removed as it is correctly updated.
    2.If your offer is accepted the status will change to partially satisfied.
    3.The balance will not be set to £0.00 until it is paid.
    4.The default balance will be set to £0.00 when paid.
    5.There will still be a date on the default date filed.
    6.In the delinquent field it will show as part satisfied.
    7.We will update the credit reference agencies accordingly.

    We trust this clarifies matters.

    Yours sincerely

    Recovery Manager'

    They are still saying the default notice is correct, I don't believe this is right as I never received notification that it was going to be placed as they were sending letters to an old address.

    The letter was actually sent from a credit services agency, I have phoned them today to complain, and been advised that they will contact RBS and someone will get back to me within 72 hours - if anyone has any advice in the meantime....

    Thanks
  • maximoomoo
    maximoomoo Posts: 22 Forumite
    Hi

    I started this thread and am still battling away to improve my credit rating.

    I received a reply from the letter posted by 'never-in-doubt' and the creditor agreed to the terms stated in my previous letter. I was not happy with this as I did not believe I could prove what the content of the letter I sent them.

    Since getting back on the case I have sent them a letter again and they have refused to remove the default from my account but will change it to satisfied if I pay the 50% I offered.

    I have 2 questions:

    1. How does an account with bad payment history affect your credit file. i.e. Is it worth me paying it if they are refusing to remove the default.

    2. How should I respond to the creditor that has knocked me back. I am tempted to reply saying that if they refuse to accept my offer then they will receive no money from me, but how will this affect my credit rating?

    This debt is the oldest on my credit file, meaning this is the last that will drop off my file, so if I do not manage to get this one removed is it worth even bargaining with the other ones?

    Does the amount of defaults on your credit file matter or is it all or nothing?

    Thanks for reading

    Maximoomoo
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