"SETTLED" ???? and other terminology!

kmaccormack

Hi there,

I had a lump sum of cash last year and paid off things like my M and S store card, Ikea homecard, very and littlewoods accounts, next accounts. I had confirmation from the lenders that the amounts had been paid and the accounts CLOSED. All of the accounts still appear on my Credit file as SETTLED....is this wrong? Should they paid in full or something similar. Someone told me when they write settled it tells lenders that you were a bad payer and then settled your debts. I paid all of them on time up until i cleared them.

My debt reduced by £9500 last May, and experian say that the amount of credit I have has not reduced significantly in the past 12 months!!!

DO credit searches automatically disappear after 12 months?

thank you

k

OneLife_OneShot

Settled means you no longer owe anything.

kmaccormack

so the fact that experian credit report shows 30 credit accounts including those settled, is ok....17 of them are settled, and none were defaults or later payers. Do lenders see that or do they just see 30 credit accounts? ta

matttye

kmaccormack wrote: »

so the fact that experian credit report shows 30 credit accounts including those settled, is ok....17 of them are settled, and none were defaults or later payers. Do lenders see that or do they just see 30 credit accounts? ta

Settled means paid in full. Credit accounts you never paid late on still show as settled when they're closed. Lenders would look for other clues such as arrangement to pay markers, defaults, etc., to get a clearer picture of how the account was ran.

Satisfied means paid at a reduced amount.

kmaccormack

thank you very much, just not really sure what to do to get my score better, I pay at least minimum cred card payment each month but usually £10 ish more, I pay £30 off my overdraft, and I have money saved and a current account where my wages go each month and never go overdrawn. I guess the savings dont really matter, as lenders cant see that!! neither can they see that I have paid £9k off my debts in last 12 months apparently!! not impressed with this, I am and have been working very hard! I had £26k of unsecured debts in 2008 I now have £9500....and I for one feel quite good about it! x

matttye

kmaccormack wrote: »

thank you very much, just not really sure what to do to get my score better, I pay at least minimum cred card payment each month but usually £10 ish more, I pay £30 off my overdraft, and I have money saved and a current account where my wages go each month and never go overdrawn. I guess the savings dont really matter, as lenders cant see that!! neither can they see that I have paid £9k off my debts in last 12 months apparently!! not impressed with this, I am and have been working very hard! I had £26k of unsecured debts in 2008 I now have £9500....and I for one feel quite good about it! x

There's no quick fix, it can take years to repair a trashed credit report unfortunately All you can do is keep making payments as you are doing. When lenders see, over time, that you have been keeping to your credit agreements, past defaults and such like will have less of an effect. Things improve a lot more when they drop off altogether after six years though.

You mention that you have savings, could you not use your savings to pay off some of your debts? If you pay off a debt and close the account, that will bring down the amount you can borrow and may help your creditworthiness, as one of the things lenders consider is how much you can borrow already when deciding whether to lend to you! Also, usually the amount of interest earned on savings is less than the interest you pay on debts.

You should always keep an emergency fund saved though, so if that's all you have I wouldn't recommend using that to clear debts.

beth3735

I have a 'satisfied' on my file, but it was paid in full. I was told that an account with a default even if paid in full will say 'satisfied'.

Settled is what is on all my closed account too where they were paid in full

kmaccormack

i'm glad you said that, I have £1k saved which is not much at all....but for me it's amazing! so I think I will keep it where it is, I have however paid an additional £100 off my credit card today, so that's a bonus, I will just keep on chipping away until they are all gone.

Just a quick one....I have a defaulted black horse loan, it defaulted in August 2011, so will the default be gone off my credit file 6 years from the date of default regardless of whether it's paid or not?? I just keep paying it, but it doesnt show as a default?? Ta

matttye

beth3735 wrote: »

I have a 'satisfied' on my file, but it was paid in full. I was told that an account with a default even if paid in full will say 'satisfied'.

Settled is what is on all my closed account too where they were paid in full

I think you're probably right actually. I can't remember whether I paid my debts off in full, but I think I did. My two defaults show as 'satisfied' on Experian and 'settled' on Equifax. It doesn't look like Equifax regards them as any different.

kmaccormack wrote: »

i'm glad you said that, I have £1k saved which is not much at all....but for me it's amazing! so I think I will keep it where it is, I have however paid an additional £100 off my credit card today, so that's a bonus, I will just keep on chipping away until they are all gone.

Just a quick one....I have a defaulted black horse loan, it defaulted in August 2011, so will the default be gone off my credit file 6 years from the date of default regardless of whether it's paid or not?? I just keep paying it, but it doesnt show as a default?? Ta

Yeah it will disappear after six years no matter what. All information on your credit report is only kept for six years, including positive information. Even after it disappears from your credit report you'll still be liable to pay the debt, so just keep on paying as you are. Once the balance gets lower you might want to ask for a full and final settlement offer, or just pay in full. Your choice.

I'm in a similar position as you in that I'm trying to turn my credit report around after past debts. I have two defaults that are now four years old and some four year old arrangement to pay markers. No adverse information since.

I've just got a credit card and am going to pay it off in full every month. This is for two reasons: -

1) To improve my credit report.
2) So that I can keep more money in my account throughout the month to gain interest on.

Experian_company_representative

Settled and satisfied both mean closed, nothing outstanding. At Experian we use 'settled' for non-defaulted accounts and 'satisfied' for defaults and court judgments.

James Jones