Bad Credit Rating - Help / Advice?

ChronoJoe

Okay so I'm a student.

On my student account I have a good credit rating, it's marked as 'satisfactory' on experian, or whatever.

But on my Loyds account, where I've never held any sort of line of credit, the account is marked as 'delinquent'.

What happened with my loyds account - I accidentally had something charged to the account. I had no money at the time so I went in and they agreed I could pay £16 a week to pay it off, something like that.

Most of what I had to pay back were charges too. I think originally I only overdrew by like £8 and incurred £30 in charges. It's £10 per day for going overdrawn without an authorized overdraft, something like that.

Anyway;

Here's what's displayed on Xperian now.

i.imgur.com/i9hcj.jpg (sorry it's not clickable, can't post or links or embed images as a new user).

Can anyone please help me make sense of it? Does that mean I'm still £7 overdrawn on that account? It got the impression I was okay. I haven't had any letters from Loyds or anything of that sort saying there was a problem... so I don't really understand why it would be marked as 'unsatisfactory'.

Any advice on what to do / explanation of what happened would be appreciated. At the moment I'm struggling with the costs of university and was hoping to increase my overdraft at HSBC; it seems absurd that going £7 overdrawn is all it takes to kill my credit rating.

guesswho2000

That means your account is four months overdue. It could be because it went overdue four months ago and hasn't been brought up to date yet.

It would appear you still owe £7, but it may be that they just haven't updated the CRA files yet. Best bet would be to speak to Lloyds first.

Additionally, being £7 overdrawn doesn't kill your credit, being over your limit does that (the limit being zero in this case).

ChronoJoe

guesswho2000 wrote: »

That means your account is four months overdue. It could be because it went overdue four months ago and hasn't been brought up to date yet.

It would appear you still owe £7, but it may be that they just haven't updated the CRA files yet. Best bet would be to speak to Lloyds first.

Okay.

If it were 4 months overdue, and I payed it now - how long would it take to resolve and my account status return to satisfactory / credit rating to increase?

I'll go talk to Loyds though, yeah.

guesswho2000

Once cleared it usually takes about a month for the CRAs to reflect this (when Lloyds send the data). It will look miles better than the account still being overdue, but unfortunately the overdue info will remain there and have an effect until it drops off, though its negative effect will diminish with time.

ChronoJoe

guesswho2000 wrote: »

Once cleared it usually takes about a month for the CRAs to reflect this (when Lloyds send the data). It will look miles better than the account still being overdue, but unfortunately the overdue info will remain there and have an effect until it drops off, though its negative effect will diminish with time.

Okay, good to know.

Hopefully if I resolve this then, I can increase my student overdraft... if not I will have to wait a bit for my credit rating to increase and try then...

Should be back to a healthy credit rating in 6 months though I'd imagine? ... Also would it be of any help to close the account with Loyds? Since I don't use it.

Thanks.

guesswho2000

ChronoJoe wrote: »

Okay, good to know.

Hopefully if I resolve this then, I can increase my student overdraft... if not I will have to wait a bit for my credit rating to increase and try then...

Should be back to a healthy credit rating in 6 months though I'd imagine? ... Also would it be of any help to close the account with Loyds? Since I don't use it.

Thanks.

You may be ok to increase your OD anyway, as I imagine HSBC will put weight on your account conduct with them and increase without a credit search (I can only speak for NatWest and RBS, but they've never searched me for an overdraft).

After 6-12 months the effect will be lessened, although I suppose it will depend on each lender as to how they interpret this. If you're not using the account and don't plan to, it makes sense to close it, although I don't think this will have much impact on your credit rating either positively or negatively.

ChronoJoe

guesswho2000 wrote: »

You may be ok to increase your OD anyway, as I imagine HSBC will put weight on your account conduct with them and increase without a credit search (I can only speak for NatWest and RBS, but they've never searched me for an overdraft).

After 6-12 months the effect will be lessened, although I suppose it will depend on each lender as to how they interpret this. If you're not using the account and don't plan to, it makes sense to close it, although I don't think this will have much impact on your credit rating either positively or negatively.

Alas, they seem to credit check me when I try to increase it - that's why I checked xperian, because they told me to. lol

I think it's amazing that small overdue charges can kill your credit rating. Seems petty.

rartherinv

ChronoJoe wrote: »

Alas, they seem to credit check me when I try to increase it - that's why I checked xperian, because they told me to. lol

I think it's amazing that small overdue charges can kill your credit rating. Seems petty.

Might seem that way from your p.o.v. and your knowledge that it was due to some mixup, but put yourself in the lender's boots... imagine someone you don't really know asks to borrow £50 from you and while you are thinking about it a friend of yours tells you they lent him money six months ago and got some of it back in installments but they never paid back the rest. Would you lend the money or would you be petty like your bank and say "no way, get lost!" ?

ChronoJoe

rartherinv wrote: »

Might seem that way from your p.o.v. and your knowledge that it was due to some mixup, but put yourself in the lender's boots... imagine someone you don't really know asks to borrow £50 from you and while you are thinking about it a friend of yours tells you they lent him money six months ago and got some of it back in installments but they never paid back the rest. Would you lend the money or would you be petty like your bank and say "no way, get lost!" ?

That's fair enough but the thing that get me is that I never asked for an overdraft. I created the account when I was 17, and wasn't even aware it had an 'unplanned overdraft facility'. Which is in reality, simply a scam to induce excessive charges.

Furthermore, if I am still overdrawn on there, and they have a problem with it... surely it's there obligation to let me know?

grumbler

ChronoJoe wrote: »

That's fair enough but the thing that get me is that I never asked for an overdraft.

It's normal to ask for a *planned* overdraft that costs much less than unplanned. Unplanned overdraft comes by default with all current accounts except most basic ones with Cash cards, Visa Electron or some Maestro cards. Processing transactions for these cards costs more - that's why they are accepted far less widely than normal Visa debit.

ChronoJoe

grumbler wrote: »

It's normal to ask for a *planned* overdraft that costs much less than unplanned. Unplanned overdraft comes by default with all current accounts except most basic ones with Cash cards, Visa Electron or some Maestro cards. Processing transactions for these cards costs more - that's why they are accepted far less widely than normal Visa debit.

Out of curiosity can you have the unplanned overdraft facilities removed? I'd rather my card was declined than end up paying £40 for a meal where I used my card, due to charges and whatnot.

Also is there any likelihood that arguing this at the bank will benefit me? I know my sister had £80 in charges and HSBC agreed to simply remove all charges, for her - at least she was notified though. Considering I wasn't notified of any problem with my account, the situation it's placed me in, seems unfair.