Calling all first direct customers!

jon_boy75

slup wrote: »

When another lender looks at your file, all they see is the '1' - they don't see the descriptive text "Late Payment" or "In Arrears".

These are put on your human readable version of the credit report to make it more understandable.

Surely in this case, the only problem here is that the human readable version is using incorrect terminology?

Ok, thanks

I will look into it

izools

slup wrote: »

When another lender looks at your file, all they see is the '1' - they don't see the descriptive text "Late Payment" or "In Arrears".

These are put on your human readable version of the credit report to make it more understandable.

Surely in this case, the only problem here is that the human readable version is using incorrect terminology?

That's exactly what I was trying to say but wasn't nearly as apt at phrasing it properly as you are

Thanks. But this is the thing - all FD will tell Experian et al is "1". Not the text descriptor. Ergo, FD aren't breaching the DPA, they're following Experian's guidelines on current account status codes.

Absolute pain in the proverbial but totally correct I'm afraid. Just have to cancel those SOs and DDs you can't afford, until such a point you can! :beer:

jon_boy75

izools wrote: »

That's exactly what I was trying to say but wasn't nearly as apt at phrasing it properly as you are

Thanks. But this is the thing - all FD will tell Experian et al is "1". Not the text descriptor. Ergo, FD aren't breaching the DPA, they're following Experian's guidelines on current account status codes.

Absolute pain in the proverbial but totally correct I'm afraid. Just have to cancel those SOs and DDs you can't afford, until such a point you can! :beer:

ah yes, but it's still down to first direct to ask equifax to change it, according to the ICO anyway.

first off, i need to see a sample credit report that a prospective lender would see

slup_2

Why would they change it if they reported it correctly?

Other lenders don't see any kind of 'report'. They just receive the raw data - it's up to them how they interpret it.

I can guarantee you 100% that all any other lender will see is a bunch of zeroes and ones...

jon_boy75

slup wrote: »

Why would they change it if they reported it correctly?

Other lenders don't see any kind of 'report'. They just receive the raw data - it's up to them how they interpret it.

I can guarantee you 100% that all any other lender will see is a bunch of zeroes and ones...

understood. have you seen a credit report that a lender would see?

just interested

slup_2

Yes, I've seen my own on the screen in a bank branch when applying for a mortgage.

All it shows is a row of numbers. The text that you are worrying about (1 payments 1 month in arrears, 2 payments 2 months in arrears, and so on) does not appear anywhere on there.

In any event, what on earth difference does it make? If there are non-zero codes in there, the new lender will pick up on these anyway.

Also, remember that your 'credit report' isn't often even seen by a human - most of the interpretation is done by computer these days.

If your report shows some 1's or 2's against a current account, and you're applying for another current account, is it not entirely reasonable for the new lender to know that you've had direct debits returned in the past? That is - after all - the whole point of what the CRA's do.

You could argue that having some 1's and 2's on there would encourage a new bank to take you on as it means they have a better chance of making some money out of you than they would a 'perfect' customer

jon_boy75

slup wrote: »

Yes, I've seen my own on the screen in a bank branch when applying for a mortgage.

All it shows is a row of numbers. The text that you are worrying about (1 payments 1 month in arrears, 2 payments 2 months in arrears, and so on) does not appear anywhere on there.

In any event, what on earth difference does it make? If there are non-zero codes in there, the new lender will pick up on these anyway.

Also, remember that your 'credit report' isn't often even seen by a human - most of the interpretation is done by computer these days.

If your report shows some 1's or 2's against a current account, and you're applying for another current account, is it not entirely reasonable for the new lender to know that you've had direct debits returned in the past? That is - after all - the whole point of what the CRA's do.

You could argue that having some 1's and 2's on there would encourage a new bank to take you on as it means they have a better chance of making some money out of you than they would a 'perfect' customer

It only matters insofar as, if a lender does a 'hard pull' on my credit file, they get to see everything, which would be fine by me. Except that there's no disctinction made between a returned direct debit (paid later that day) and an account 'in arrears'. From a lenders perspective, how can they differentiate just by seeing the numbers and some generic text? They can't.
So, in these very small instances where a direct debit is returned, apparently only reported by first direct, it can appear to lenders as if the account has been in arrears, when it patently hasn't.
The distinction is important to me, as a returned DD is not a big deal, whereas 'Arrears' are a very big deal.
It does seem like Equifax's reporting is insufficient to reflect all scenarios and make a distinction between them. It's even more important for them to be accurate now as lending criterias have tightened up so much.

Svenena

Surely a current account can't be in arrears, as there is no regular payment due? Therefore the a 1 on a current account would obviously not mean arrears. I presume that banks are familiar with the CRA guidelines izools posted, and would interpret a 1 on a current account as either a bounced direct debit, bounced standing order or being over the authorised overdraft limit.

ScarlettsMum

Just on a side point the hsbc group are really bad at sticking to experian rules.

"Experian have rules outlined explaining what status codes mean on current accounts when the appear on your credit file:

Any financial institution who uses experian to report and / or search is aware of these rules, so they know that a "1" against a current account doesn't mean "One Payment Late", but that it means that one of the three criteria mentioned in the Experian rulebook have been met by the account holder."

They marked 4 different defaults on my current account when I had never had met any of the three criteria. When I asked them why they said it was because the account was inactive. I pointed out that experian have a different way of recording this and that they had therefore made a false report of a default. To there credit they did remove the defaults (and not record the dormancy) when I brought this up but it was still very frustrating!

ScarlettsMum

izools

jon_boy75 wrote: »

Except that there's no disctinction made between a returned direct debit (paid later that day) and an account 'in arrears'. From a lenders perspective, how can they differentiate just by seeing the numbers and some generic text?

They can.

They know two things when they get the raw data:

1. What status codes mean when referring to a Bank Account
2. The fact that the type of account the "1" is recorded against, is a Bank Account

The distinction between a credit account in arrears, and a bank account run improperly, is that the creditor sees whether it's a bank account or another type of account, that the data refers to.

Lenders are just as concerned about your ability to pay your credit card on time as they are concerned about your ability to ensure you've got enough in the bank to cover instructions set up to debit said account.

Of course it will have a similarly negative effect as a credit card in arrears, because it's an equal level of poor account conduct.

I understand your viewpoint and argument but the fact remains you won't be able to convince the financial institutions concerned that they are wrong - as they aren't.

You'll just have to take it on the chin, move on, and be more careful & vigilant with your current account in future :beer: