Credit files- What happens after 6 yrs?

needtofightback

i've read a few threads about 6 yrs + that debts become statute barred. Could anyone clarify exactly what happens then?

My husband has a CCJ from 2005 & I have defaults that went into default in 2005 too that we haven't paid. The defaults are all with DCAs, & although we haven't replied to any they just seem to keep changing hands! The good part of that is that our debts are not as much as we thought at first, as there were different amounts being chased. Untangled them all now & it just seems the new DCA's were chasing the same debt with interest added on.

Following advice on here I've just got copies of our credit files, as I was thinking of setting up a DMP although we've not a lot left every mth so it will be a long, drawn out process. After reading about the 6 yr date though, I'm now wondering whether or not to sit tight & wait, as we've not heard from some of the agencies for over a yr. That way we could save the money & if we do get into a legal situation could maybe offer a F&F?

I know I sound like i'm trying to get out of the debts i owe, but i'd be first to agree! In my defence i tried hard to pay minimum amounts getting nowhere for so long to my debtors, & despite me staying in communication with them at all times my pleas for help & understanding fell on deaf ears. I even paid lump sums amounting to 6k over 4 cards but realise now that it was a waste of money, I should have just completely paid 2 cards off as end result was I still ended up nearly owing as much with the compounded interest, so i don't feel any guilt that if i can get away without paying i will!!

I look forward to receiving as much info as possible.

bottleofred

Hi needtofightback,

Debts do indeed become statute barred after 6 years (5 in Scotland), but as far as I'm aware only if they are defaults. I think CCJs are a different matter, but will allow somebody with more knowledge than me to deal with those. Defaults fall off your credit file after 6 years, so you may indeed be better to save some money in the event of full and final settlements. As I said, someone with more knowledge than me will be along soon regarding the ccjs.

Good luck

DarkConvict

If there is no CCJ on a debt it can go statute barred. Given 6 years (5 in Scotland) of no written acknowledgement or payment on the account, it will go statute barred.

As to the defaults, this have no affect on the statute barred debt. Basically its a a marker on your credit file, it technically lasts forever, but creditors can only see the last 6 years, meaning effectively after 6 years its fallen off the visible credit file.

needtofightback

Thanks Dark Convict, if the defaults aren't showing but are still there in effect, does that mean they still have to be paid? Also do you mean the ccj will remain on file until it's paid?

needtofightback

Also, what exactly is classed as an acknowledgement. If say I wrote to ask for CCA etc, would that be an acknowledgement? Not done anything as yet but was originally going to offer all a token payment until our finances improve, now thinking i'm best not to do anything.

Regarding the ccj, the last letter regarding this was last year from a dca telling us we could have a 40% discount, so i take it you can still negotiate even when it has got to ccj state?

NorthernLas

NTFB - Defaults and what you owe on a debt and whether a debt is statute barred are different things. You get defaults when you do not pay the amount that the creditor wants, so you break your contract with them.

As DC says a debt can become statute barred. This means that the creditor cannot chase you for the debt. They can ask, but you can tell them that they are out of time.

A CCJ is where a creditor has gone to court to get you to pay your debt. If you don't pay, the creditor can continue to chase you.

DarkConvict

Asking for a CCA is a grey area on acknowledgement.
Asking for a CCA is at least acknowledging the account, but its grey to if you are acknowledging the debt owed on the account. never-in-doubt always said no it didn't count as acknowledgement but legally i've not seen it used either way.

The default doesn't mean you owe the money, the defaults merely means you failed to pay, the fact there is an outstanding balance means you owe the money. If a default has fallen off your report after 6 years the remainder of the balance is not wiped, it is owed until it is repaid be it in full or via a settlement offer.

Negotiation with a CCJ is possible, however most DCA do not given the debt is secured for the amount on the CCJ. In your case they may not even have realised they have a CCJ against the debt.

needtofightback

Thanks for the clarification NL, hope i don't seem stupid I get the ccj can be pursued so will make 1st F&F to them but does it actually stay on the credit file or does that drop off after 6 yrs too, paid or unpaid?

DarkConvict

CCJ, paid or unpaid will fall off the credit file after 6 years. Whether a CCJ is visible on your file or not only affects your score, the legal status of the CCJ whatever it may be still stands.

A Creditor can ask for an unpaid CCJ to be readded in theory, but in practice i've never seen it done.

needtofightback

Thanks again DC. i understand it a bit more now. If the debt falls off the credit file after 6 yrs can another dca put it back on as a debt or will it stay off forever? I'm confused as if it can't & it's unenforceable through the courts is there any reason (apart from moral of course) why i should repay after becoming statute barred?

Has it been known before that DCAs don't realise there's a CCJ on the debt their chasing?

DarkConvict

If its gone statute barred it should have come off your credit file, and so it shouldn't go back on.

Its only moral reasons why you repay SB debts, you have to remember the part of credit crunch is due to creditors lending to people who didn't pay.