Partial Payment - What's The Score?

alannadrama

I'm looking to start paying off my debts to get my credit score back up but I can't afford to pay it all off. I'm aiming to offer 50% to all my creditors.

I know if they accept the payment, a 'P' will go on my credit file to show that partial payment has been made. Will this mean that i will still have trouble getting credit in the future?

Do banks and lenders see that 'P' and think "oh well, she only pays a bit of her debt off so we won't lend to her" or should it not make a difference?

Also, how long does this 'P' stay on my file?

matttye

alannadrama wrote: »

I know if they accept the payment, a 'P' will go on my credit file to show that partial payment has been made. Will this mean that i will still have trouble getting credit in the future?

Do banks and lenders see that 'P' and think "oh well, she only pays a bit of her debt off so we won't lend to her" or should it not make a difference?

Every lender/bank has their own criteria. Some may not be bothered with partial payments, as you have still paid off what the creditor was willing to accept, while others might think that they don't want the same thing to happen to them!

alannadrama wrote: »

Also, how long does this 'P' stay on my file?

6 years from the settlement date.

Tixy

If you have any accounts that show a default then they will be removed from your file 6 years from the default date, so the P would only be on for any remaining period up to that 6 year anniversary.

For accounts without a default then as said above its 6years from the date of settlement.

alannadrama

Thanks both, good to know

izools

You'll also find that you won't have any offers of partial settlement accepted by lenders with whom you haven't defaulted.

Those that you have defaulted with the account disappears six years from the default date, whether settled, partially settled, or still outstanding.

A settled default, partially settled or "fully" settled will still be a default and still negatively affect your credit rating, but not as much as an outstanding default.

Once you've paid off and settled your old bad credit it's imperative you start building impeccable recent history with a bank account, mobile contract, and credit card from someone like Vanquis or Capital One. Without this, you'll find it very hard to get any more credit, whether or not the old accounts are still on your credit file.