Default on old bank account! Some questions...

sturgeon

Hi there,

Out of interest I decided to check my credit file tonight using a website that searches all the big credit agencies.

Everything looked in order as I hadn't ever made any late payments or had any defaults to my knowledge.

However, there is one problem that showed up on an old bank account. I'm not sure why this didn't appear previously-I thought it might be because it's on an old address I might not have entered when I previously used this credit agency site around a year ago.

I was in my arranged overdraft but the balance was stagnant. I was a student. As far as I remember, after receiving a letter asking me to pay something in I made an arrangement with the bank to pay about £50 a month. This went on for several months but I do remember it wasn't paid for a few months. I was not aware it was a formal arrangement as such (i.e. recorded with credit agencies, but seems it was when looking at the file).

The culmination was in about April/May 2009. I had just applied for a mortgage for my first home, which was accepted fine. I had notified the bank in branch that my address had changed at least 6 months prior, yet for whatever reason they did not action it. I've actually had this problem before with a different bank.

I can't quite remember how I figured out there was a problem, however I called up the bank (Santander, formerly Abbey) to try and pay the balance off, which I did right away. They said they had sent several letters yet I advised them these had not been received and I had applied in branch for the address to be changed. I definitely asked if a default would be placed on the account and I was told no.

Basically, they did put a default on the account. The following month it is shown as 'satisfied'. It expires in May 2015.

A few questions:

1) Primarily, I am very annoyed that despite me applying in branch to change my address, they continued to send all correspondence to my old address. I thought they have to advise me with 28 days notice of a default. Without question it would have been paid off immediately. Is this allowed due to the fact I asked for an address change and they didn't do it? Can it be removed and if so, how?

2) I applied for a credit card at least a year (so about May 2010) and this was accepted with no problem. I also had a new contract for a mobile approved with a new company in June 2010. Can I assume that this means my credit record has not been dented irreparably? I have a mortgage, a history of multiple bank accounts, mobile phones and credit cards all with a 100% rate of being paid on time.

3) I might possibly increase my mortgage amount in a year or two as I currently own a share of the property, at this time my salary will be high enough to buy outright. Would my current lender do a credit check then, and despite having a perfect record with them, refuse to increase the mortgage due to a default?

4) By chance it seems the default was posted in April 2009, my mortgage was applied for and agreed in principal in probably February 2009 but due to a long buying process was finally finished and funds released late May 2009. Does this mean they didn't see the default, and if so am I in the wrong here?

5) The default is shown against the address before my previous one (so two homes ago if that makes sense). If not providing this previous address, as most usually ask for history over 3 years or so, does this mean they don't see the default?

6) Most of my file seems to be against Equifax. My score is 634 but my public score is 814. What's the difference? My experian public record is 739 and I don't seem to have a non-public record showing (or any accounts at all against experian!?)


All quite worrying, I appreciate any advice.

MoneySaverLog

sturgeon wrote: »

5) The default is shown against the address before my previous one (so two homes ago if that makes sense). If not providing this previous address, as most usually ask for history over 3 years or so, does this mean they don't see the default?

If they are asking for history over a period of time which includes this address and you do not declare it then this would be considered as fraud, and they may well put a CIFAS marker on the account which you must avoid at all cost.

I suspect that when you obtained your credit card that the default did not show up, because there was no link with your previous address where the default was logged against.

Any hint of a default and the credit card companies will run a mile, with possible exception of vanquis. You may well get away with a mobile contract, don't know.

If you have put your old address details into the CRA to obtain your credit file, then they will now have a record of your old addresses and they will now be linked for future applications for credit. If you were to apply for any other credit the default will show up with that agency.

Best bet would be to contact the lender and negotiate its removal.

sturgeon

Ok thanks.

So you're telling me by using this website (checkmyfile) that I have inadvertently now alerted all agencies to the fact I have a default against an old address-really?!

I would have thought they could see it anyway, as I thought the credit rating stays with the person and not the address.

Do I have a decent case against the bank with my scenario? i.e. by them not actioning the address change, I didn't receive the default warning and was clueless it even happened.

MoneySaverLog

It is recorded against the person and not the address, but if they had no record initially of you being at that old address then there was nothing to link you so your credit file would appear clean. When you confirmed your details it is likely that they updated your file, based on the information you have provided to them.

I would only think Call Credit CRA would be affected, as they do sell on their data to sites like annualcreditreport.

sturgeon

Strangely, when checking an old report it did show that address as linked. For whatever reason, the bank account involved wasn't showing up at all.

What I don't get is by confirming your details, that credit agencies are 'updating my file'. I thought checkmyfile exists to do exactly that, check it. Not that things I type in are reported to the credit agencies.

I spoke to Santander today. It seems they did have my correct address at the time. However, it also seems they sold on the overdraft as a debt and their collection agency contacted me at an entirely random address. Therefore I got no letters and no warning they'll put a default on my account. From this, does it seem likely I have a case to get it removed?

MoneySaverLog

You are creating the link by putting in previous address details, that's why it gets updated. Happened to me that way when I checked my files, old records started to appear.

Why would the DCA send a default notice to a random address, instead of your last known address? That's strange.

If this is the case however, and the DCA cannot show they had good reason to believe you lived there at the time, you may have a claim that you never received their default notice. You should request that they send you a certified true copy of the default notice and if they cannot provide one with your correct address details at the time try to get it removed that way.

They will come after you at your new address though.

sturgeon

Thanks. I understand I'm creating the link but that's because it's explicitly asking me for previous addresses on that website, to get my full credit history. I know from past experience only putting one address on will obviously only get certain accounts.

I'm afraid I still don't understand how the credit agencies are being 'updated' this way. I'm not on the Experian/Equifax website, telling those companies to please update records to include all these previous addresses. I'm simply accessing my records and the more previous addresses put in, the more credit accounts show up.

I really don't get why they sent it to a random address. However, I explicitly remember when I was on the phone and asked what address they used, it was baffling as it was just wrong. Yet Santander told me today that they had the correct address on their systems in '2008', so at worst a good 4/5 months before this default was sent out. So someone's in the wrong here.

I am concerned that the random address has been deleted from record as they may have changed it when I called them up. However, I assume they should have a copy of the default notice sent out, which should include the address it was posted to?

You mention they'll 'come after' me. For what? I paid off the £200 overdraft the instant they explained to me they'd been chasing me without my knowledge, hence the default shows as being satisfied the month after it was placed on my credit record.

pqrdef

sturgeon wrote: »

So you're telling me by using this website (checkmyfile) that I have inadvertently now alerted all agencies to the fact I have a default against an old address-really?!

Oh yes. These firms are bounty-hunters. The banks have a lot of defaulters who've gone away, current address not known. Anybody who can put them onto a current address will be well rewarded for their trouble.

This is one reason why these firms are keen for you to check your credit report. On the form, they ask for your previous addresses. Why? Any record that can't be linked to you without that information isn't affecting your credit rating - until you supply that information.

jalexa

sturgeon wrote: »

.....All quite worrying, I appreciate any advice.

OK, just noticed your OP. Will try to digest it and offer advice about the "missing" default notice later.

But regarding your credit reports I have some strong personal advice. First, forget the concept of "credit score". Basically "worthless" (doubly "worthless" if you had to pay). "Worthless" because lenders calculate their own score.

I do not recommend the process you followed. Either you paid or it was free. If "free" what's in it for the information provider? [Edit: err.. just seen the previous post and the possible answer]

Instead get one-off reports from Equifax and/or Experian. The other CRA is less important. One-off statutory reports cost £2. Go through the report with a fine tooth comb looking for errors and omissions. You are entitled to a 100% accurate report, nothing more nothing less.

And an aside, take care that you haven't signed up for a recurring subscription.

Will have a look at the "default" question later.

sturgeon

Thanks for your advice. I wish I knew that I had inadvertently alerted agencies to this default, I've not seen any advice on this site previously (including Martin's page on checking your reports) that suggest providing this information can jeopardise you. It was free for 30 days and I presume the point was they hope I forget, or remain concerned about my rating and don't cancel the forthcoming £7.99 a month subscription.

The good thing, I suppose, is that there's no debt to chase. I paid it off right away as I've always been knowledgable about the pitfalls of a bad credit rating and how you might get to that status. That's why this is quite depressing, I am just grateful it didn't seem to affect my mortgage application. Would appreciate some advice about the default question, Jalexa. I'm hopeful that as I genuinely never saw the default notice that I have good reason for it to be removed.

happy_bunny_2

You could send them a SAR to find out exactly what information they hold on you (addresses etc). Once that arrives (max 40 days I think), then you can decide whether or not to submit a formal complaint.

You could submit a formal complaint anyway and see what they say.