"Delinquent" c.c. @ ref agency - strategy?

samizdat

Hi, first post, love the site.

I signed up for Equifax Gold Creditwatch (thanks) and had a look at my reference.

I have a "red 4" (four missed monthly payments) on a credit card. What happened was that this card was with Intelligent Finance but they withdrew their Offset card and transferred my account to Halifax Card Services. I was unemployed at the time and having marital difficulties so (not an excuse I know) I didn't check my mail for a while. I subsequently realised that my direct debit instruction to make payments on the card was failing because it was set up to pay off the IF card, whereas the new account had different details.

As a result, I also went to £8400 debt on a £8000 limit. So my file says "Account last delinquent 10/2005, delinquent balance £8400, current balance £5000." For your info., I did not in fact reapply to Halifax at the time of the Offset card's withdrawal so I no longer have a card that I can use, just a continuing account that I have to pay off.

I am with LloydsTSB so I tentatively inquired at a branch about a Platinum Card (0% for 9 mths) but was told "there is something on your file at the reference agency that automatically disqualifies you but we can't see what it is ourselves without doing a formal check". I assume this relates to the above problem because there is nothing else bad in my history at Equifax. Lloyds itself, however, knows that I missed a couple of payments on my personal loan (£7000 left of £10k 5-year loan, not mentioned at Equifax) with them at about the same time as the above events.

So, I am wondering how to improve my profile. My strategy is:
1. Write to Intelligent Finance and ask them to amend the file, citing personal difficulties combined with their unnoticed withdrawal of a long-standing facility. Maybe I could at least reduce the number of missed payments on the file? Not holding out much hope on this because of my past experience with their customer services.
2. Either transfer the balance to a 0% card if I can get accepted, or
3. if not, pay off all but £200 using my wife's personal loan (new £15000 5-year loan, also with Lloyds, already taken out), then keep making a monthly payment just to chalk up some history.

My question is, is it best, from a credit rating point of view, to keep the Halifax account alive like this to show a repayment history, or would I be better to pay it all off asap?

As for getting accepted for a new credit card, whether 0% or not, other details are that I am earning £40k per annum and am a home-owner with two-years of mortgage repayment history (no missed payments on Equifax). What are my chances? Do you think Intelligent Finance will help at all re amending records at Equifax?

Edited: Noticed my reference does not say "credit limit £0" on Halifax card.

Voyager2002

I certainly think you should contact IF and Halifax to ask them to amend that part of your credit record. Ultimately, the reason why those four payments were not credited to your account was that they failed to collect payment using a DD that you had authorised. You might even get some joy from the ombudsman. If these measures fail, then contact Equifax and ask them to add a note to your file explaining why those payments were missed. The slient point is that the creditor failed to collect using a DD that was already in place.

samizdat

Thank you for your reply, perhaps there is still hope! Mind you, the thought of dealing with IF customer services is truly horrific!

Still interested in responses re completely paying off the formerly delinquent, unusable, credit card account versus keeping it alive with a small balance. Having read around the site some more, it seems that there are some providers who will offer me a card with a high rate, which I can use to build up some more history - but I think I'm getting history from the unusable account too and perhaps having quite a high stated limit of £8,000 (even if I can no longer use it) will look good if I reduce the balance further. This is from what I read here about how it is best to aim for a small number of providers with high individual limits with plenty of unused capacity. Comments please.

accountnurse

Have you checked your Experian file? The agencies don't always have the same information. If your file at Experian is in better shape you could apply for a credit card from a provider who does their searches there. There is a list showing who searches where-click 'credit file' in blue band above your first post.(sorry I can't help with old debt question)

samizdat

accountnurse, Thank you for your suggestion. I have sent off for my Experian file. When I tried to sign up for their free on-line trial, it seemed that they required a credit card, not a debit card, so I couldn't proceed with that!

I'm expecting that information about a delinquent account would have been shared around, unfortunately.

Meanwhile, I have written a letter of complaint to Intelligent Finance, which I will copy to Halifax Card Services - I expect each part of the the HBOS Group will tell me it is the other part's responsibility.

samizdat

Well, I wrote to Intelligent Finance, who wrote me one of those "we have investigated but have decided to do nothing" letters.

I have appealed to the Financial Ombudsman Service but no doubt it will take a few months for the matter to be adjudicated. I'll post an update when I hear something.

Meanwhile, I've reduced the balance on my expired Halifax credit card to £110. I'm keeping it alive just to show some repayment history and to send those red missed payment notices a little further back on the file. Next month, it will be a year since the notice of delinquency was recorded so I'm thinking of trying for a new cc. If necessary, I'll go for a Barclaycard Initial or some other credit builder card but I'm also wondering if I might qualify for a better card by now, e.g. possibly with my long-term bank LloydsTSB (see above for more detail on my history). Not sure if they record any info with the agencies and anyway, 0% on balance transfers is no good to me unless I could transfer my personal loan to it via some "Super BT" method that I think will be too difficult for me with my current rating.

I covet an &More M&S card, which would enable me to convert the next 12 months spending into a 0% loan. Anyone know how strict their credit scoring is?

samizdat

Well, an adjudicator at the Financial Ombudsman Service has written to say that the FOS is minded to reject my complaint. Irritatingly, many of my points seem to have been ignored. Furthermore, there is a a degree of speculation about my actions that is not based on any attempt to investigate the facts, contradicts my evidence to them, and happens also to be untrue. I have sent a detailed response and will just have to wait some more.

Meanwhile, it's now about a year since the "notice of delinquency", a term that I have not seen used on these forums. Not too sure if it's really a category of badness somewhere below "default" or if it's merely a colourful description of the fact that I exceeded my credit limit or that I missed four payments.

I have just been offered a credit card by LloydsTSB (Platinum). Annoyingly, they also briefly offered me a fee-free 0% balance transfer on the "your offers" section of my internet bank account, an offer that it was pointless to accept at the time because I have only £100 odd quid left on the old Intelligent Finance credit card account. I have been waiting for my record to improve before risking any new applications.

Now, I am minded to settle the Intelligent Finance account prior to applying for:
1. A Nationwide current account, and a debit and a credit card if they'll let me have them.
2. A 0% purchase card, e.g. M&S
3. An Egg Money Card for stoozing my personal loan onto ...
4. A 0% fee-free Balance transfer card (maybe wait for another Lloyds special offer period)

I realise it will take maybe a couple of months for the notice of satisfaction to feed through but, once that has happened, do you think I'll get any of these cards/accounts?

I am encouraged by Lloyds's offer but obviously they know me better than most other banks/issuers so probably can ignore my credit file. Salary is now £45k so some improvement there too.

If it's too soon, do I get any benefit from stretching the time it takes me to pay off the Intelligent Finance balance? I am just making minimum payments with the idea that I'll have monthly green ticks on that account, which will push the red missed payments further back. If instead I had satisfied it immediately it would just show four red followed by one green and a "Satisifed" notice. Which approach would be best in the circumstances or does it make no difference? Should I start another thread with this specific question?!

It's all very frustrating!

Finally, one for the lawyers: where do I stand on voyager2002's point? If the FOS turn me down, I'm minded to sue Intelligent Finance (for defamation?). My idea is that I had given IF authority to claim payment from my current account when I set up the original direct debit. IF subsequently wrote to me requiring that I renew this authority, failing which they told me that payments would not be taken from my account. Are they entitled to say that, because I did not respond, they no longer had the authority to claim payment?

I would argue that, since I never revoked my original authority, IF were not entitled to ignore it just because they decided unilaterally to demand its renewal. This would undermine one of the central purposes of the direct debit mechanism, which is to provide a way of meeting the multitude of continuing obligations that confronts the modern citizen with some degree of automaticity. If service providers could nullify such an arrangement with 30 days notice, our lives would become intolerably burdened with administrative minutiae.

What are my chances? Have been looking into the direct debit transaction structure and previous FOS case studies but I have found no direct precedent there and have not searched the law reports.

Call_Centre_Monkey

samizdat wrote:

Finally, one for the lawyers: where do I stand on voyager2002's point? If the FOS turn me down, I'm minded to sue Intelligent Finance (for defamation?). My idea is that I had given IF authority to claim payment from my current account when I set up the original direct debit. IF subsequently wrote to me requiring that I renew this authority, failing which they told me that payments would not be taken from my account. Are they entitled to say that, because I did not respond, they no longer had the authority to claim payment?

I would argue that, since I never revoked my original authority, IF were not entitled to ignore it just because they decided unilaterally to demand its renewal. This would undermine one of the central purposes of the direct debit mechanism, which is to provide a way of meeting the multitude of continuing obligations that confronts the modern citizen with some degree of automaticity. If service providers could nullify such an arrangement with 30 days notice, our lives would become intolerably burdened with administrative minutiae.

What are my chances? Have been looking into the direct debit transaction structure and previous FOS case studies but I have found no direct precedent there and have not searched the law reports.

I'm sure IF/Halifax would have run the changes by their lawyers first. It's extremely unlikely what they did was unlawful. They just wouldn't expose themselves in a way that could result in them breaking the law.

TKW

Call_Centre_Monkey wrote:

I'm sure IF/Halifax would have run the changes by their lawyers first. It's extremely unlikely what they did was unlawful. They just wouldn't expose themselves in a way that could result in them breaking the law.

Now, I'm not saying you're wrong, but look at the bank charges - who would have said a couple of years ago that the banks would be exposing themselves by applying unlawful charges?