One debt paid off! Impact on credit file?

timetogrowup89

Hi all,

I have cleared my first debt, it was a store card and showed as defaulted years ago on my credit file..

Just wondering if now it has been paid off and should change to settled and show a 0 balance will make any difference to my credit report or will I have to wait the 6 years for it to fall off before any improvement happens?

Still getting my head around credit reports and improving them etc..

Thanks

x

Thrifty_Pixie

the default will stay on your report for 6 years after the original default date

timetogrowup89

Ok..

So does an account with a default that has a balance cleared look better on a credit file than one which is defaulted and has a balance?

Im not looking to apply for credit any time soon but would like to in a few years time, so trying to do the best I can with my credit file.

Thanks

x

[Deleted User]

I am no expert, but my understanding is that it will look better having it settled than not having it settled.

I think other things that may have an influence on how it's viewed are the amount of the default and the length of time between default date and settled date.

It will fall of your credit file 6 years after the original default, not 6 years after it was repaid.

When was the debt defaulted?

timetogrowup89

The debt I have just paid off defaulted in 2008..

I have another debt which is now my focus of clearing. Default date in 2010..

I am hoping to get a mortgage, probably in about 5 years time so these defaults will be off by then, was just kinda hoping that regular payments going to these and finally a settled balance would start to make my file look a bit more favourble than it currently does.

Thanks

wannabehermit

ime one default will screw you for the next 6 years.

DH had a small default when he was made redundant a couple of years ago (now settled), despite that being the only negative on his file (he has 16 other credit agreements showing on his report and all are 100% green, he doesn't have a single other late on there) he has as much trouble as me in obtaining credit and I had a DRO when I split with my ex.

The_Boss

As stated, better to be satisfied than outstanding, but the damage has already been done.

If you have other active cards (not in a DMP) then keep paying them on time in the meantime.

timetogrowup89

I have an active card that I buy all my petrol on and clear in full each month, hoping this will show that I make regular payments..

By the time I clear all my debt and save a deposit the defaults will be gone, so will just focus on getting everything to a satisfied state.

Thanks