Repairing credit score after defaults

cmssbrie

Hi,

My credit report shows that I have 6 x 'defaults' on my file. 4 of these are due to come off (as it has been 6 x years since the default date) by the end of the year, whilst the other 2 will expire in May 2015.

Have a few questions which I hope somebody will be able to help with!

1) Will my credit score improve when the 4 x 'defaults' come off my file at the end of this year?
2) Will my credit score improve significantly when all of the defaults expire in May next year?
3) How likely would it be to get a new mortgage deal next May / June? (Bearing in mind I do have 5 x 'positive' open accounts on my file which have never had any defaults)?

Would really appreciate anybody's advice :-)

sirwiggum

cmssbrie wrote: »

Hi,

My credit report shows that I have 6 x 'defaults' on my file. 4 of these are due to come off (as it has been 6 x years since the default date) by the end of the year, whilst the other 2 will expire in May 2015.

Have a few questions which I hope somebody will be able to help with!

1) Will my credit score improve when the 4 x 'defaults' come off my file at the end of this year?
2) Will my credit score improve significantly when all of the defaults expire in May next year?

The thing is, there is no such thing as a 'credit score' in terms of lenders. The arbitrary number assigned to you by the customer facing information from credit agencies will likely increase, yes.

However each lender has their own criteria, some 'bad credit' lenders may accept you with one or two defaults on file, others will not go near you with a single default or arrangement to pay on file.

In short though, yes your chances of getting credit will increase when all of your defaults are off your file.

3) How likely would it be to get a new mortgage deal next May / June? (Bearing in mind I do have 5 x 'positive' open accounts on my file which have never had any defaults)?

Would really appreciate anybody's advice :-)

I'd say you should be fine.

I've been through a similar scenario, and as an example of how credit acceptability can change - 6 months ago I had my last remaining default on file and an arrangement to pay marker.
Stupidly, I applied for a credit card through my bank to use for occasional business expenses.
Declined.
(I did get a Capital One / Luma card though it had a low limit and is more or less useless in practice, though it did build up a little bit of recent credit history)

6 months later and my credit file has had the default dropped off and I disputed the arrangement to pay and had it removed, the bank sent me an email that I was guaranteed to be accepted for that same credit card....

I'd say once your defaults have dropped off, you should be in a good position to get a good mortgage deal, assuming you have no other late payment / arrangement to pay markers etc.

cmssbrie

Thank you so much for your help!!