I could do with some advice on something hopefully straightforward..

hanb

Hi all,

I've been pottering about on here for a while now, mainly looking at ways to be better with my money but for the first time ever I just checked my credit report and I'm confused and concerned. I'm hoping someone might be able to offer some advice!:o

7 years ago (Ish) I opened a bank account with Halifax. I was 18 at the time and given a £1000 overdraft. I stupidly spent it! I was having a tough time in studying A levels full time and living independently so 'free money' was amazing! After spending it all I couldn't afford to pay it back. Charges were whacked on and it totalled about £1300. I managed to claim back charges and got it down to just around £1100. CCCS then put a payment plan in place for me to pay £1 a month which I have done every month since then.

Cabot Financial now have the debt and my report states the account commenced in 2006 and defaulted in 2010. Does this mean I opened the account with Halifax in 2006 and missed a payment in 2010? Or is one of these dates when it was passed to Cabot?

I'm concerned about the 2010 date.. I have definitely paid £1 every month since before then so surely the default date would be when I missed a payment? Or before the payment plan was set up? Can this date be changed if incorrect?

I also offered full and final settlement on a couple of seperate occasions of £600 but this was rejected.

My other question is my rating is 1/5 and I don't know if this is down to the above or the fact I've never had a credit card? The above is the only debt I have ever had. I've never had a credit card, store card, loan etc. I've had a phone contact and the usual utility bills and have never missed a payment. Should I consider getting a credit card to improve my rating? I'm hoping to buy my first home in the next year and although I'll have about a 45% deposit I'm concerned all
Of this will prove a problem!

I seem to have written an essay..:o Sorry! But any help or advice would be really appreciated!

Thanks in anticipation

Hannah x

Thrugelmir

hanb wrote: »

I'm hoping to buy my first home in the next year and although I'll have about a 45% deposit I'm concerned all
Of this will prove a problem!

Then pay off the debt you owe. Do you expect a lender to advance you a mortgage of thousands of pounds when you are repaying a debt at a £1 a month. May seem to be the smart thing to do. At the end of the day there's only one loser and that's you. As banks have better risks to lend to you. Attitude to management of personal financial affairs is what lenders increasingly screen for. Credit rating is all about your profile.

manzanilla

I'm hoping to buy my first home in the next year and although I'll have about a 45% deposit I'm concerned all
Of this will prove a problem!

yes it is likely to prove a BIG problem. You need to use some of your deposit to clear this debt in full - not a full&final settlement which will still leave a black mark on your credit file.

And you need to do this as soon as possible, so it is starting to look like old history by the time you apply for the mortgage.

Yes you should also get a credit card, use it every month and pay off the full balance every month. But this alone won't help - it is the problem debt you aren't dealing with that is the major cause of your bad credit rating.

dukeboxx

Yes pay off the debt its a burden that will affect you in the future

hanb

Sorry, I should have been a bit more clear - I fully intend to pay off the debt before buying a house. I don't currently have any savings of any description which is why I'm paying £1 a month.

My dad recently passed away and I will be putting some of my inherritance to a deposit to buy a house and will use the money to pay off the £1000 OD too. I'm not just not paying my debt and using the money for something else.

hanb

Sorry, one more thing - when i do pay for off the OD I'm of the understanding I can request for the default to be removed from my file. Does this mean that the problem is completely removed and future lending (mortgage!) would be less of an issue? Or does it stay on the file in some way?

UsetheFORCE

hanb wrote: »

Sorry, one more thing - when i do pay for off the OD I'm of the understanding I can request for the default to be removed from my file. Does this mean that the problem is completely removed and future lending (mortgage!) would be less of an issue? Or does it stay on the file in some way?

Of course you can 'ASK' them to remove the Default but why would they do that? If the default is accurate then it should stay as it is an accurate reflection on the account conduct!

If you managed to get it removed and the account paid off then that will indeed be the end of the matter.

Out of interest, what markers are showing against this account prior to the default date? Is it AP??? I ask as I am wondering why they have defaulted the account 4 years later, it should of been placed on your file no later than about 6 months after the action that caused it.

hanb

UsetheFORCE wrote: »

Out of interest, what markers are showing against this account prior to the default date? Is it AP??? I ask as I am wondering why they have defaulted the account 4 years later, it should of been placed on your file no later than about 6 months after the action that caused it.

I used the free callcredit option so not sure whether that's different to others but it just says default and states the date, there's no other comment that I can see. The dates were my main concern because it's definitely much later than when I defaulted.

I think I might call cabot today and see if they can tell me why it says that date and possibly ask them about removing the default (once paid), or at least amending it the correct date.

Thrugelmir

hanb wrote: »

I think I might call cabot today and see if they can tell me why it says that date and possibly ask them about removing the default (once paid), or at least amending it the correct date.

The likelihood of this is nil.

No lender or business for that matter wishes to deal with a bad paying customer. So credit profiles are a way of warning each other of who to avoid.

The onus is therefore on you to rectify your record with a period of good behaviour.

fermi

hanb wrote: »

I used the free callcredit option so not sure whether that's different to others but it just says default and states the date, there's no other comment that I can see. The dates were my main concern because it's definitely much later than when I defaulted.

I think I might call cabot today and see if they can tell me why it says that date and [STRIKE]possibly ask them about removing the default (once paid), or[/STRIKE] at least amending it the correct date.

If you feel the default date is factually inaccurate then you could challenge them on that.

However, when a default occurs on something like an overdraft is subjective at best and highly dependant on the circumstances.

Read this link --> https://forums.moneysavingexpert.com/discussion/3172602

While complicated, reading that should give you a better idea whether that date is unfair, and if so on what grounds.

hanb

Thanks all for taking the time to reply

I had read the article on credit http://www.moneysavingexpert.com/loans/credit-rating-credit-score#files
which is where I'd got the wiping of a default off
"Negotiate with the lender. If you're prepared to settle the debt, either in part or in full, then you can negotiate with whoever you owe the money to. You can also make a condition of settlement that the default is wiped off your credit file."

I'll read that fermi, thank you.

On a plus - I've just got a credit card from my bank - scary how easy it was to get one - a much higher limit than I thought too!! But, I'm going to use it once a month to fill up my car and I set up a "Pay in Full" DD when i applied for it so I can't get in any trouble. Hopefully I can now start building up a decent rating! As soon as my inherittance comes through I shall pay the balance of the debt in full. In the meantime I shall carry on paying it with the standing order that's set up.

Thanks again all.