Default explanation needed

InDeepDebt

I have at least one default at the moment and am likely to ‘collect’ a few more off various creditors along the way.

From reading various posts and threads I understand some of the logic behind a default but I could do with a few things clarifying; I’m just thinking to the future when hopefully I will be credit card debt free.

A default lasts on your credit file for six years as far as I’m aware.

If you settle your debt, can you get the default removed (before six years) or does the default just become marked as ‘satisfied’ (or whatever)?

Moving on from the last statement, if you have a satisfied default and you apply for credit, it is still a black mark against you and getting credit will be more tricky.

I do have a reason for asking the above. My wife and I have a large amount (£69k) of CC debt that we are paying off – albeit slowly. £30k of this debt could be unenforceable, the rest we intend to pay and should be able to within four years – by Aug 2014. I am hoping, or rather wanting, our credit record to be as clean as possible at the end of the four years.

Am I living in cloud cuckoo land here and will have to simply wait an extra two years for the defaults to go or is there a way of ‘tidying up’. One thought that I do have is the unenforceable stuff – once it is very likely that a CCA is not forthcoming, is offering a severely reduced F&F settlement (say 10%) going to improve the look of my credit file? Would (or rather could) a creditor remove a default as though it have never been there or would/could they simply mark it as satisfied with zero balance?

Looking to the future, I don’t intend to get a load of new credit cards but we have got a large mortgage which we may need to move to another supplier at some point to get the best rate.

Thanks in advance

Jim

InDeepDebt

Don't like bumping my own thread but if anyone can offer advice I would be most grateful.

Cheers

Jim

NorthernLas

Jim - I think it is a black mark for 6 years whether is is satisfied or not. See the following article http://www.learnmoney.co.uk/credit-file/remove_default_notice.html

Burlesque_Babe

unfortunately defaults are viewed as almost the same as a CCJ when it comes to applying for credit. Even if you have unenforceable debt, it won't disappear from your credit report for 6 years.

fermi

InDeepDebt wrote: »

If you settle your debt, can you get the default removed (before six years) or does the default just become marked as ‘satisfied’ (or whatever)?

The latter.

However, some lenders/DCAs have been know to do you a 'deal' whereby the default is removed in exchange for full settlement of the account.

Not overly common for creditors to agree to that, but occasionally it is possible. It's something you would have to ensure you got proof of in writing though.

Locke

On the subject of defaults, can someone explain to me in layman terms the difference between a default notice and a notice of default?

Or are they the same thing?

InDeepDebt

Thanks all for the replies, especially the link to the article on default removal.

Looks like, regarding unenforceabilty(sp), I'll just sit tight for six years and see what happens.

Another question. Hopefully this is just out of interest. If you have a debt that you can't pay that you get a default for in year 1, this will drop off your credit file in the seventh year. If the debt takes a further 5 years to settle, during which time you're not making full payments - I am assuming that the creditor cannot issue another default. Can they take legal action against you? This is assuming that you have been making payments during all of this time, just not a sufficient levels of payments for the creditor (does that make sense)?


Jim

fermi

InDeepDebt wrote: »

Another question. Hopefully this is just out of interest. If you have a debt that you can't pay that you get a default for in year 1, this will drop off your credit file in the seventh year. If the debt takes a further 5 years to settle, during which time you're not making full payments - I am assuming that the creditor cannot issue another default.

No, they can't.

InDeepDebt wrote: »

Can they take legal action against you?

Yes. If they did that and got a CCJ, then that would go on your credit files for 6 years from the date they get the judgement,