Does a failed payment affect my credit rating?

JammieDodger

Hi all,

It was one of those times when I was drifting off to sleep then a thought hit me...

I recently changed from A&L to Halifax after a disasterous experience with their (lack of) customer service.

Halifax told me that all my direct debits had been switched over and I could close my old A&L account. I didn't close it, but I discovered that they hadn't switched all my debits over, and 2 of my credit cards had charges and interest to them - Post Office credit card and Hilton Visa.

The Post Office refunded me the charges but the Hilton wouldn't. It's a long story, but after bad customer service from Halifax, they agreed to refund my charges. Incidentally, A&L tried to charge me on my old account, even though it was their fault they hadn't closed it properly.

Anyway, do these late payment charges show up on my credit scoring? We're talking about 2 late payments for credit cards, one of which was quashed by the credit card company, and a fee for insufficient funds in my A&L account. Can they be reversed?

It really wasn't worth switching accounts for the £45+ fees I had to incur, or the 3 weeks it's taken to sort out!

Any help gratefully received,

JD

alanq

Late payments show up on credit reference agency reports. I am not sure that the records can be changed as they are factually true even though the problem was not your fault. You can, however, have a Notice Of Correction added to each of your credit files explaining what occurred. You can order a copy of your credit reports for £2 from each of the three credit reference agencies (Experian, Equifax and Callcredit) and see what they do say.
For example:
http://www.experian.co.uk/consumer/faq/AR5.html
http://www.equifax.co.uk/Products/credit/statutory-report.html

Talk about frying pan and fire. Which?reports that the banks with the least satisfied customers are Santander and Halifax / Bank Of Scotland. This was also the result of a recent poll on this site.
http://www.moneysavingexpert.com/banking/compare-best-bank-accounts

dunstonh

Anyway, do these late payment charges show up on my credit scoring?

potentially yes. You will need to check your credit details. Its possible that they wont if you cleared them quickly and they acknowledged it was a bank error but a late payment does usually show.

It really wasn't worth switching accounts for the £45+ fees I had to incur, or the 3 weeks it's taken to sort out!

Switching banks and getting direct debits sorted smoothly has never been something that has worked well. You are better to keep the accounts running together and switch them yourself. Some originators are notoriously slow at making changes or will revert to the old bank after acknowledging the new bank details.

In your case, the bank may well have done all the notifications and thought all d/ds were transferred over. Your mistake was not closing the account or not monitoring the old account. A classic mistake and one that occurred often 20 years ago and its clear it still happens today.

JammieDodger

Thanks, I had no idea it would be so difficult - I wrongly assumed that the process was automated, in today's day and age, and would be smoother. I changed from HSBC to A&L 3 years ago and I don't remember any of these problems.

I will get the details of my credit reports checked in the next few months, and get some corrections made.

The whole reason I switched to Halifax was because our local Halifax branch is notoriously good at customer service. Obviously, I found the one person at my branch who isn't good at CS!

Thanks for the replies everyone... I'll try and be more vigilant now!

JD

hugheskevi

Switching banks and getting direct debits sorted smoothly has never been something that has worked well. You are better to keep the accounts running together and switch them yourself. Some originators are notoriously slow at making changes or will revert to the old bank after acknowledging the new bank details.

I'd definately agree with this...a few months ago I switched current accounts and moved everything myself. All was fine except for Tesco credit card.

First month following the change was fine, they took the direct debit from the new account.

Then the following month they took the direct debit from the old account (still active, but zero balance, the payment went through putting account into unauthorised overdraft territory but I check accounts daily, so immediately moved funds to cover it and there were no consequences).

The next month no direct debit was taken from either account. I called them up on the afternoon of the day it was supposed to go out and Tesco insisted an active direct debit was on the account and would be taken in the evening so I didn't need to do anything.

At 9pm that day a late charge was put on the account. I called them at 10pm and everything seems to have been sorted out, and hopefully next month they will get it right - I'll still have money in both accounts to cover it, and be watching my accounts carefully on the day to make sure it is taken!

I find it amazing that large businesses can have such poor processes for business-as-usual.