Credit repair following settlements

AndyJR81

HI, I am a new member and I was looking for advice from people who have been in a similar situation to me. Will lay out the background to my situation as might be an interesting read.

I graduated from university in 2005 with around £2000 owing on a credit card and int. free overdraft. I was quite lucky and landed a job with a national company, one of the rare graduate training roles with a good route of progression etc. I was there for around 2 years, promoted twice and as I was earning quite well, reduced my overdraft limit by around £50 per month. As I had to move away and had no savings I took out a graduate loan with Lloyds TSB for £5000. This was for a deposit + 1m rent on a flat, a new car, suit etc, and there was around £800 left which I took myself on holiday with. For a couple of years all was well, I had no problems making repayments, and even had two new credit cards I had been pre-approved for by my bank, with no need for a credit check (can't even remember what that feels like!).

I had a career change in summer 2007, as I decided what I was doing wasn't right for me. Whilst retrospectively this was the correct decision (I'm happy in the same field 6 years later), it did mean starting the training ladder again, and I dropped £9000 off my gross salary. I started relying more on using the cards for general living expenses, wheras previously I had used them for one off purchases, which were quickly paid off. As a result the balances were soon maxed out and I was in that kind of cycle of paying £200 off a card and spending it again the same month. Still not undoable, and thought it would be temporary as salary would soon go up with exam passes etc.

Unfortunately the company I had been working for went bust, and I was out of work for about 6 weeks. In that time I missed a few payments; however the worst thing was that there wasn't enough in my bank account to cover the graduate loan payment. Lloyds took it anyway and my account exceeded my agreed o/d limit. This was back in the days when you were charged £25 per day for up to 10 days, and kick started a nasty cycle whereby I was getting charged up to £250 per month, mainly due to the fact that I was being charged £250 per month. They were always very clever when ordering transactions on my statements so I could never argue that the charges themselves had caused me to go o/d.

In the end I just couldn't keep up with the merry go round anymore, and after looking at a potential IVA (which would have probably precluded me from continuing my career), I was informed about the possibility of a DMP. By this stage (mid 2008) I had racked up a frightening £15,000 in unsecured debt, and flushed my credit rating down the toilet in the process. Entered a DMP in September of that year, and kept up with all payments faithfully. By late 2010 things had improved quite significantly, to the point where I took myself off the DMP and resumed making contractual payments in most instances. Lloyds agreed to refinance the loan and overdraft into a single debt, marking the old ones as satisfied in full in the process. I made as many payments as I could which brought my total down to around £6000 by mid 2011. My CR was up significantly, and I even managed to get a loan from HSBC which I used to pay off some of the more expensive old card debts.

Just when I thought things were on the up, August 2011 arrived in a blissful summer of rain and grey skies. By the end of the month my marriage was on the rocks thanks to my wife's affair with my step daughter's guitar teacher. I was asked to move out of the house I was paying the rent on, or she was going to take the kids to a homeless shelter. Was I going to be the kind of man who would do that to his children? As a gesture of good faith, come August payday I paid the landlady September's rent to give Mrs Andy chance to get her benefit claims sorted (she doesn't work) without the landlady hassling her. I stayed with my parents, initially I thought for week whilst I got myself sorted and found somewhere else.

Alas I got back after work on that day to find my wife had cleaned out our joint account (basically my wages) into her own account (which she already received tax credits, CB into). She did transfer back £60 for me to make last the month - considerate hey :rotfl: . So cue another round of missed payments, and the setting up of another DMP. Worse this time as I now had to find solicitors fees, mediation fees, and deal with fraudulent CSA claims (she told them I never saw the kids when in fact they were with me 3 nights a week).

This year has seen a slight improvement. I have my final professional qualifications, have had a pretty significant payrise, and things are cordial with the ex. I'm renting a small 2 bed semi with a nice garden which is great for the kids and am much more settled. With this in mind I approached my local credit union, explained the circumstances and without much hope asked them to consider me for a loan of £5,500 which I would use to pay off all the existing bad debts, and finally draw a line in the sand. I could then start rebuilding. I must admit to being utterly surprised that they accepted me, on the condition that they would pay the money to my DMP company to make payment on my behalf. This has now been done, and I am delighted that as of 8 May, Lloyds TSB, HSBC, Blair Oliver Scott, Halifax, RMA, Arrow Global , Egg, Metropolitan and BLS are ghosts of the past, and I am now paying 1 loan to the credit union for pretty much the same as my DMP amount. I also have 2 'bad credit' credit cards which I am using for shopping etc and paying in full each month. Using them responsibly, I have a credit limit of £2,000 on one of them although in no danger of using it to that extent.

I'd like to hear off others who have been through a similar time. I'm hoping to save a deposit and buy my parents house off them so that they can retire somewhere nice in the next few years, and so need to do as much rebuilding as possible. The repayments have not been reflected as yet, and I understand that can take up to 60 days but I will keep an eye on what that does to my experian and equifax ratings.

Really just looking for advice on what else I can do to help myself. I'm on electoral roll, have disassociated myself with my ex (no joint debts) and am managing the small credit accounts I have responsibly as it is, and just would appreciate any pointers

Experian_company_representative

Sounds like you're on the right track to me. Any negative info should decrease in significance as it ages, especially if you're replacing it with more recent positive information. Adverse entries usually drop off your report altogether after six years.

James Jones

kjglen24

This is a really inspiring story Andy.... My Life is a little different to yours...

I went to University, and had a student credit card and overdraft both around £2000, as I had studnet grants and worked part time I could pay it off, then my dad died..... I dropped out of uni (my head wasn't in it) and instead of dealing with it I buried my head in the sand

I tackled it a year later and took out another loan to pay it off, all went well, had a store card to rebuild credit all was great and then BAM!! Redundant, I was living in West Wales and there are zero jobs avaliable, I couldn't find one for ages and the debt was spirilling out of control....

I don't know what my credit report is like but a mess is probably an understatement, Ive been stupid but when life hits you hard I guess people deal with it in different ways.....

Anyway, I decided to up sticks and move to Bristol.... I need work, I needed to sort my life out. I found a job and still there now and I love it, I make decent money now and have settled in nicely. I even started a university degree with Open University just to get my life where I want it to be (microbiologist). I have applied to obtain my Stat Credit Report with Experian (had to send proof of address, which is a nightmare as I have no bills in my name) once I get this I am going to pay them off one by one.... I will improve my credit rating and never be stupid again... Lesson Learnt well and truely

matttye

Just keep on paying off those credit cards in full every month and that will help.

If you're not already, try to put some spare cash into an emergency fund each month so you have a contingency plan in case things go downhill again.

I can't quite believe what your ex did to you! That is really low.

AndyJR81

Thanks for the replies guys.

KJGlen you can sign up for a free 30 day trial with experian credit expert, and equifax to look at your report. With experian you get the score for free, but you have to pay something like £5 for equifax whilst on the trial. I found it worth it though, I just cancel the trials, and then sign up for a new 30 day one a few months later to keep an eye on progress. Great to hear that you too have picked yourself up off the floor after a life changing event. I'm starting an OU in Law next year, just for personal interest

Matty yeah it was pretty low. We rented a house opposite my parents and I found out because they were decorating the front room and the girls (stepchildrens) nan had come to pick them up for the week. Apparently as soon as her car had gone round the corner with them in it this guy was 'dancing in the street like he'd won the lottery' (mums words). Still need to get a DNA test on my youngest child as this all went off around the time she conceived. Not nice at all. Has really put me off relationships, I've met some lovely single people but have no confidence whatsoever and find it hard to get past 'dating' stages!

I am saving with the Credit Union at the moment, and am in the middle of setting up a trust for my children so I can put money into it outside of my own assets in case her solicitor decides she is entitled to half of it at some point without needing to give them automatic entitlement at age 18.

kjglen24

AndyJR81 wrote: »

Thanks for the replies guys.

KJGlen you can sign up for a free 30 day trial with experian credit expert, and equifax to look at your report. With experian you get the score for free, but you have to pay something like £5 for equifax whilst on the trial.

.

I tried that, but for some reason they cant find me and it doesn't work.... very annoying

Good Luck with OU course, it will change your life

Good luck with future relationships too, I can only imagine how hard it is for you

AndyJR81

I read some of your other post - sounds like you're having a mare with them. It took me years to get my experian one for some reason. Hope you get it sorted. They had my ex down as an associate even though we no longer have joint accounts etc so was useful to see as I've had her removed - off my credit report that is