CL Finance - defaults 6 months in arrears

in Debt-Free Wannabe
27 replies 5.6K views
Hi - I've got a couple of questions for you experts, as I'm trying to clean up my credit file...

1) I have a default for around 100 pounds (sorry, my pound sign isn't working!!?). The default date is September 2009 and it was my own fault - didn't pay on time :( I've tried writing to the company and getting them to remove it as a gesture of goodwill (thought it might be worth a try!) but no luck. I've noticed on my credit file that the default wasn't registered until July 2011 - would I be able to ask for it to be removed on the grounds that it wasn't registered in a timely manner??? Or is it a case of grin and bear it? (The debt was paid in full in January 2010).

2) I had a debt with GE finance for around 1500 back in 2005. I entered a DMP with Payplan - there were other debts as well - and I've been making regular monthly payments since the start of the DMP in 2005. Anyway...all of the other debts have now dropped off my credit report (I'm still paying for them monthly) but the only debt left on my credit report is the one with GE finance (it's registered with CL Finance - I don't know whether it was sold on or CL Finance is a part of GE Finance??). When I checked my credit report last week, there was approx 900 pounds still outstanding on that debt - I phoned CL Finance and paid the debt in full, as I had been saving some money to try to clear these debts one at a time. Anyway, every month's payment shows as a 6 for this debt. So, even though I've paid it, my credit report is still going to be a wreck for ages isn't it? Is it right that the payments have been recorded as 6 months late every month, or should a default notice have been registered (because it would have flamin dropped off by now!).

Any advice would be HUGELY appreciated

Thank you all :)
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  • camuk81camuk81 Forumite
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    Cream sorry I can't answer more but I would argue the first on the case of the date. Are you sure the date you're looking at isn't the date updated.

    Make sure you contact them my recorded delivery outlining when the date was paid and they move it back.

    As regards gesture of goodwill, I'm going through the same and some do and some don't its hit and miss. Though I think they probably say no as it has to be an accurate reflection of your credit file
  • 1) They won't remove the defaults as it is an accurate reflection of your credit history. There is not set law or rule for "timely manner" - the ICO suggests six months after defaults but agrees that there can be exceptions. So the fact they registered 2 years later is definetely not grounds for them to remove it.

    2) Again they didn't have to register a default once you've missed 6 payments. Guidelines which most lenders use are just that guidelines. Not laws so they've done nothing wrong.

    The only way a default will ever be removed is if you really didn't default or they somehow c0cked up and you can prove it. Not the case here.
  • fermifermi Forumite
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    1) Did you default in 2009? If so, then the default date of 2009 would be accurate. Not much that can be done there.

    2) Depends on how your reduced DMP payments compared to the full contractual payments that should have been made on whether a default was appropriate.

    However, if it was then lenders are not allowed to continually register accounts as 6 months in arrears instead of filing a default. That is an abuse of the system, and a breach of the DPA on grounds of data accuracy and ICO guidelines.

    Certainly worth investigation making a formal complaint on that one, if you think a default at the time would be a more accurate representation of the account history.
    Free/impartial debt advice: National Debtline | StepChange Debt Charity | Find your local CAB

    IVA & fee charging DMP companies: Profits from misery, motivated ONLY by greed
  • Thanks everyone - Fermi, my original contractual payments were for around 50 a month but I paid them 10 a month via the DMP. That's definitely something I'll look into anyway.

    I know the state of my credit report is my own fault - I just want to try to rebuild my life so I'll plug away at trying to improve it! Thanks again everyone :)
  • fermifermi Forumite
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    Have a good read through the info here on what they should have done.

    http://forums.moneysavingexpert.com/showthread.php?t=3172602
    Free/impartial debt advice: National Debtline | StepChange Debt Charity | Find your local CAB

    IVA & fee charging DMP companies: Profits from misery, motivated ONLY by greed
  • Thanks Fermi - that's a great help. I think I will contact the ICO about the GE Finance debt. As I said, it's recorded as being 6 months late every month (since the DMP began in early 2005), but there is an additional note to say that it's being paid as part of a DMP. The debt is still showing as outstanding because I only paid it off last week.

    I do think though that it maybe should have been filed as a default, as my relationship obviously broke down with the original lender, who subsequently sold the debt on. If I'd been completely irresponsible and not made any effort to pay, they probably would have filed a default and it would have dropped off my credit report by now!!

    Thanks again for your help - I'll post an update on how I get on.
  • I didn't mention in my original post that I'd written to CL Finance a few weeks ago asking them if they would consider amending my records to show that my payments had been up to date, as I had made every payment to them on time (don't all start giving me grief - I hadn't read up so much about all this when I wrote them the letter!).

    Anyway, I have received a response today, saying:

    'Please note that the '6' status on your credit file refers to the six months or more contractual arrears that you are in. We agreed to accept your reduced payment offer due to your financial difficulties, however, this meant that your credit file would reflect the fact that contractual payments are behind.
    After six months of your credit file showing contractual arrears, we could have entered a default onto your credit file for this account. However, we felt that this would put you in a worse position, so we kept the Credit File at the status '6'. The entry for this account will be removed six years from the date the account is cleared.
    We trust this clarifies the matter, etc, etc...'

    How could they possibly thought that a default would put me in a worse position?? The status '6' has left me in a mess until 2018 (as I paid off the debt in full last week).

    Wasn't my contractual aggreement with GE Money, not CL Finance? Do you think I've got a case with the ICO? Is there a possibility that I could get a default put in my file retrospectively (ie, dated early 2005 - I stopped paying all of my creditors in December 2004 and my DMP began in April 2005). I've just looked through my PayPlan payment history: I paid GE Capital Bank from April 2005 until February 2007. From March 2007 until May 2010, the payments went to the Lewis group, then from June 2010 until February 2012 - when the debt was paid off in full - the payments were allocated to the Leiws Group/GL Finance GE. Are these all part of the same company or was my debt sold on?

    All help greatly appreciated!
  • fermifermi Forumite
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    1) Yes, not recording the default put's you in a worse position. So good cause for complaint there.

    2) It is also inaccurate, so again cause for complaint.

    3) The ICO also specifically states that:

    "A record showing a series of payments as six months in arrears when this does not reflect the real payment history should not be used as an equivalent of a default."


    I would write again pointing those out.

    If they still refuse to amend the record, then complain via the FOS and ICO.
    Free/impartial debt advice: National Debtline | StepChange Debt Charity | Find your local CAB

    IVA & fee charging DMP companies: Profits from misery, motivated ONLY by greed
  • fermifermi Forumite
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    Sorry but of course a default is worse than late payment markers showing on your file, so I'm afraid I agree with what they've said.

    In the short term, worse. But on a long term repayment plan a default clears after 6 years.

    This fake 6 month in arrears record screws their credit record nearly as bad as a default, BUT for 6 years beyond the settlement as well.

    So in this case for nearly 13+ years. :eek:

    It's also not an accurate record of the account. Full stop.
    Had they also added a default, this too would've been showing on the account for 6 years (from when it was issued) as well as the late payment markers and, even if it had been satisfied, it is much worse than a late payment marker.

    But would have been gone altogether in 2011 had the default been recorded when it should have.
    Free/impartial debt advice: National Debtline | StepChange Debt Charity | Find your local CAB

    IVA & fee charging DMP companies: Profits from misery, motivated ONLY by greed
  • Brilliant - thank you so much, Fermi :T

    I'll start my reply to them NOW!
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