Default on a loan

fluffykins13

My BF took out a loan with A&L in July 2004. A default status was placed on the account in Jan 05 due to him being stranded in Oz due to an accident and couldn't pay between Sep 04 -Dec 04. Since Jan 05 he has made regular monthly payments on time and has not missed any. He is due to pay the final instalment of the loan next month.

He recently checked his credit report and noticed that the default status for the loan has been on the account every month from Jan 05 up to this month even though he has made regular on-time payments for over 3 years.

Should a default status still be on the account?
If not, how can it be wiped for those 3 years of regular payments?

Thanks for any help you can give.

PNPSUKNET

Im not sure but would be intrested if you do as this would open worms with other lenders

never-in-doubt

It seems he started paying after they had already defaulted him. Therefore he will have to wait for 6yrs after the default date before it will be erased.

He could try a letter appealing to their better nature, but if they defaulted him and then he started paying, it's really up to them.

The only way it could be enforced for removal is if they added it after he had commenced paying. In which case it would be unlawful and a breach of CCA (1974) and the Banking Code.

fluffykins13

fluffykins13 wrote: »

My BF took out a loan with A&L in July 2004. A default status was placed on the account in Jan 05 due to him being stranded in Oz due to an accident and couldn't pay between Sep 04 -Dec 04. Since Jan 05 he has made regular monthly payments on time and has not missed any. He is due to pay the final instalment of the loan next month.

He recently checked his credit report and noticed that the default status for the loan has been on the account every month from Jan 05 up to this month even though he has made regular on-time payments for over 3 years.

Should a default status still be on the account?
If not, how can it be wiped for those 3 years of regular payments?

Thanks for any help you can give.

Latest Update

My bf sent A&L a letter asking for a copy of the original notice of default which A&L should have a record of. They came back with:

"Unfortunately, we are unable to provide you with a copy of the default notice, as the original default was issued to your home address on 2nd december 2005, A&L are only obliged to keep a record of the issue date of a default notice. Nevertheless we have today enclosed a copy of your loan agreement as per your request"

I'm not 100% sure but if they dont have an actual record of the default notice then I'm hoping that my bf can still get it removed, as surely they need to be able prove they sent notification.

Can anyone shed some light on this

Thanks

fluffykins13

He sent a letter off to the Alliance and Leicester and got this response back:


Under the Consumer Credit Act 1974, A & L is not obliged to keep copies of these notices. Our computer records serve as evidence of the dates and amounts involved.

As the default was issued correctly in accordance with industry guidelines, we are unable to remove the default from your credit file.

A&L has acted in accordance to the Consumer Credit Act 1974 and as such we consider the matter closed.

Are they right that they're not obliged to keep copies?

never-in-doubt

Fluffy, what they say is utter nonsense, they must provide a copy of a default notice. Have a read of this thread for templates etc: http://forums.moneysavingexpert.com/showthread.html?t=1868507

Have a read of this letter:

Letter to request copy of Default Notice - Formal Demand

Taken from post #5

Section 87(1) of the 1974 Act allows the creditor to send you a default notice giving you fourteen days from the date you receive it to pay the arrears. The default notice must contain all of the necessary information under the Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 ('the 1983 Regulations'), which includes

• a statement saying the notice is a default notice served under section 87(1) of the 1974 Act
• a description of the agreement
• the name and address of both the debtor and the creditor
• details of the breach (i.e. late payment) and, if the breach can be remedied, the date by which it must be remedied or, if the breach is not capable of remedy, the amount required to be paid after the expiry of the specified date;