Default charges on credit history

YorkshireBoy

Dr_Cuckoo3 wrote: »

In that case why would a harsher status code be given when a cheque is bounced once a month where the account is within its agreed overdraft limit at least once a month or indeed for most of the month

Perhaps because it shows a wilfull disregard for the account's T&Cs, and reflects repeated attempts to spend money you haven't got?

For example, using a cheque guarantee card to obtain goods to the value of £50 or £100, or sneaking a card transaction under the 'floor limit' of a retailer, is account abuse if you don't have the funds available to meet the payment...and if you're doing it month on month then it warrants a stiffer penalty doesn't it? Lenders have a duty, under the 'principles of reciprocity', to report such activity. After all, they'd expect to know if one of their customers was doing the same elsewhere.

Making an informal overdraft request, by the submission of a DD or SO, and then being in the unfortunate position of being laid off work so no wages being paid in - and therefore remaining in unauthorised overdraft for a second consecutive month - might be considered a 'lighter' offence?

My interpretation is that this applies to cheques bounced because the account has remained over the agreed limit continuously for more than two months

I don't share your interpretation, for the reasons given above.

Dr_Cuckoo3

something I overlooked is "Your account is not overdrawn" because "Cheques, direct debits and standing orders may have been bounced to keep the account in order."

So the ""Cheques, direct debits and standing orders may have been bounced to keep the account in order" clause covers an account which is not in unauthorised overdraft (there is usually a fee for this so in most cases the account would become overdrawn )

presumably this clause is intended for an account with no funds being paid in and an insufficient balance to pay Cheques, direct debits and standing orders

As the OP mentioned that the account was put back in order each month I do not think that this clause would apply

If an account had no funds being paid in and an insufficient balance to pay Cheques, direct debits and standing orders continuously for three months this would justify a "3" status code , but not if there is a break between items bouncing (eg there are funds to cover atleast one payment in the month)

I think the status code punishment is the same for all the breaches and not cumulative

so "Your overdraft balance has been greater than your overdraft limit for two to three months." would not be cumulative if the account was put back in order each month

Dr_Cuckoo3

YorkshireBoy wrote: »

Perhaps because it shows a wilfull disregard for the account's T&Cs, and reflects repeated attempts to spend money you haven't got?

For example, using a cheque guarantee card to obtain goods to the value of £50 or £100, or sneaking a card transaction under the 'floor limit' of a retailer, is account abuse if you don't have the funds available to meet the payment...and if you're doing it month on month then it warrants a stiffer penalty doesn't it? Lenders have a duty, under the 'principles of reciprocity', to report such activity. After all, they'd expect to know if one of their customers was doing the same elsewhere.

These wouldn't be bounced though - so the clause wouldn't apply
http://www.experian.co.uk/downloads/consumer/YCREJul08.pdf
"Cheques, direct debits and standing orders may have been bounced for a second month to keep the account in order"

YorkshireBoy wrote: »

Making an informal overdraft request, by the submission of a DD or SO, and then being in the unfortunate position of being laid off work so no wages being paid in - and therefore remaining in unauthorised overdraft for a second consecutive month - might be considered a 'lighter' offence?

This customer will be given a harsher status code for not bringing the account within the agreed limit at any time during two CRA update periods

masonic

Dr_Cuckoo3 wrote: »

I suggest that as soon as a breach is rectified the clock is reset - therefore the next status code will be "1" if the account is not in order again and will only accumilate to a "2" or "3" if unrectified

Your suggestion may well be the way some banks operate. However, Experian seem to allow banks to be harsher if they want to be:

Cheques, direct debits and standing orders may have been bounced for a third month to keep the account in order.

There is nothing to say the above cannot happen even if the account is brought into credit each month. If a bank chose to report that as a "3", I suggest that the OP would probably be wasting his time trying to get a "3" changed into a "1".

It is irrelevant and unhelpful to try and second guess what a bank might do in this situation. The very fact that a "3" status could reasonably be expected according to Experian's information means that whatever has in fact been reported may be correct. There is nothing productive to be achieved by arguing for or against this from a position of ignorance. If the OP believes a "3" is not appropriate in this situation then a call to Experian should be all that is needed to clarify the rules.