Default Notice

Charlie_B_2002

Hello,
Can someone please clarify:
Is a lender required to provide a Default Notice prior to adding a default to a credit file?
Thanks.

rizla_king

Not always. Depends on the type of account and the T&Cs.

BonkersBonkers

...............Before this thread gets any further OP please answer one question - did you default - no ifs or buts did you default - one word answer please?

fatbelly

From ICO guidance:

Lenders should tell their customers about filing information with a credit reference agency as part of the account opening procedure, in line with the requirements of the ‘fair processing code’. This explanation will not normally refer explicitly to defaults and will often be distant from the events which cause them. Therefore we strongly recommend that a notice of the intention to file a default should be served. Many lenders now subscribe to trade association codes of practice which require this. This practice helps the transparency of the credit reference process and may even prompt payment, so avoiding the need to file a default at all.

33 Notices to comply with Sections 13.7 of the Banking Code and 7.5 of the Lending Code should provide adequate warning. A notice of intention to file a default can be sent with a formal default notice under Section 87 of the Consumer Credit Act 1974. Where lenders are not required to issue these notices, they can send an intention to file default through a final demand, letter or relevant account statement, which should make clear not only the intention to file but also the date of the intended default. The date should allow the customer enough time to respond properly. Lenders who have to provide a notice of intention to file a default under a relevant code of practice should be aware that not complying with the code may be taken into account in any assessment of the fairness of their processing.

34 When a default occurs in line with the criteria in this guidance, and the lender has given the customer 28 days notice of the intention to file a default, then subject to paragraph 37, the lender may supply this information to a credit reference agency despite no advance warning when the account was opened.

35 It may not be necessary to serve a notice on all occasions. We accept there are cases when there should be no doubt over a default, for example, cases:

• involving fraud;
• where the lender has been notified under the terms of a bankruptcy or IVA;
• where there has been successful court action or repossession; or
• where a customer has made no attempt to resolve their arrears

.