4 defaults for paying too early! Do I have a leg to stand on??

hula_girl

Evening everyone

I'm hoping someone can help me as being too eager to pay back a debt may have messed up the next six years of my financial life! (Apologies for the drama but I'm stressed!)

Long story short: had a £1000 car bill, rather than skint myself for a month I used a promotional money transfer rate on an existing card to 'borrow' £1000 at a cost of £40. Then set up a standing order to pay £208 a month back to the credit card for 5 months.

I thought I'd worked all my dates out for statements and due dates and set the SO for a few days after the statement date. (I would've done a DD but these don't let you set an amount other than minimum or full, which is crazy.)

It seems the transfer ended up not completing until a few days after the first SO payment went out! So, the bank has effectively ignored the first of the 5 payments and counted the next 4 as late! I have 4 default charges, 4 lots of interest, and worst of all I will soon have 4 black marks against me on my credit file. :eek:

This has come at the worst possible time as I'm currently trying to move home! So I'm desperate to do anything I can fix these 4 black marks. I'm currently drafting a letter to the beardy boss of the 'bank'. Any expert advice and inventive suggestions would be very welcome.

Thanks in advance

PS. Before this I was blemish free financially. I know some people wil probably reply and say it was my own fault for not double checking the account every month. Believe me, I've been beating myself up over it all afternoon since I realised what had happened. So if we could stick to helpful replies I'd appreciate it as nasty ones will only make me cry and I've already run out of tissues!

droiderm

Are you sure they are defaults, or "just" late payments.
Did you not realise the payments were late after the first one?

I sometimes try to be too clever with things likes this and it doesn't always work out as you expect.

stclair

Did you set up the SO for every month when really the billing cycle is every 28 days?

dalesrider

hula_girl wrote: »

It seems the transfer ended up not completing until a few days after the first SO payment went out! So, the bank has effectively ignored the first of the 5 payments and counted the next 4 as late! I have 4 default charges, 4 lots of interest, and worst of all I will soon have 4 black marks against me on my credit file. :eek:

Well I can understand one late payment. But then any months after that will have had a payment onto them.

hula_girl

droiderm - Sigh, you've hit the nail on the head with you second point. It says on the statement 'Late Default Sum'. When I called the CC to query they said they would have to report it to to the credit reference agencies. As an example, the first statement date is 21st and my first payment was 20th. The due by date was 10th of next month when my second payment was made on 20th. So, I guess they're all 'very late' as their system sees it as opposed to missed. Does this make a difference?

stclair - I set up my payments for 20th of month for 5 months. Statement dates are mix of 21st and 22nd.

stclair

hula_girl wrote: »

droiderm - Sigh, you've hit the nail on the head with you second point. It says on the statement 'Late Default Sum'. When I called the CC to query they said they would have to report it to to the credit reference agencies. As an example, the first statement date is 21st and my first payment was 20th. The due by date was 10th of next month when my second payment was made on 20th. So, I guess they're all 'very late' as their system sees it as opposed to missed. Does this make a difference?

stclair - I set up my payments for 20th of month for 5 months. Statement dates are mix of 21st and 22nd.

Thats fine just that sometimes if the payment reaches the account before the statement is generated the payment will be applied to previous statement.

Plus I appreciate most SO are sent via faster payment however are the payments being applied to your account the same day or does the lender apply the payments to the account days later making them late. Vanquis is a good example of this practice.

rb10

hula_girl wrote: »

droiderm - Sigh, you've hit the nail on the head with you second point. It says on the statement 'Late Default Sum'. When I called the CC to query they said they would have to report it to to the credit reference agencies.

That is unlikely to mean that you've actually defaulted.

It will almost certainly be reported to Credit Reference Agencies as being four months in arrears - which whilst not looking good on your credit report, is significantly better than even just one default.

You can explain the situation to the card company and ask that they amend how they report it to the CRAs. However, I would not expect that to be successful, since they are entirely correct.

(For future reference, many credit cards do allow a fixed payment or fixed percentage of the balance to be paid by direct debit, which would have avoided this issue. They can generally be set up by phone but not online. No idea whether Virgin Money offer this or not.)

sistafromanothermista

rb10 wrote: »

(For future reference, many credit cards do allow a fixed payment or fixed percentage of the balance to be paid by direct debit, which would have avoided this issue. They can generally be set up by phone but not online. No idea whether Virgin Money offer this or not.)

They don't. It's either the min or full amount.
What you should do is set up DD for the min then set up a standing order for any overpayments. That way you won't get into trouble again.

hula_girl

rb10 - thanks for clarifying the difference. I did make 5 payments in the same space of time they sent me 5 statements - just not on the dates they wanted! I think I'll have the try adding a note to my credit files although it may require some clever wording!

sistafromanothermista - thanks, that's sound advice for 'next time' - eek!

Can anyone explain where this leaves me with regards to a mortgage application? And if a letter to the big boss (my usual line of attack) will make a blind bit of difference?

droiderm

Defaults are worse than late payment but i fear 4 late payments in a row won't look good .
I think it will depend on lots of things. Primarily the deposit amount and affordability . Why don't you post on the mortgage forum you will get some better answers there.

stclair

Who is the lender out of interest?

Write to them and ask if they will update the information as a gesture of goodwill if you was paying by standing order every month.