Advice on removing default

J5891

Hi

We currently have a default on a HSBC overdraft. We only became aware of it when our mortgage application got rejected.

We would like to pay it off in one go rather than spread over payments.

Can we:

1. Negotiate the amount we pay off if we do it in one sum?
2. Ask HSBC to remove the default

Thanks

Tixy

1) You can try - though they may only agree to mark that it was partially satisfied on your credit file (to reflect that there is no balance outstanding but that you didn't pay the full amount).

2) you can ask but it is unlikely they will agree to it if you did genuinely default on the debt.

How old is the default? (default date on your file)?
Any particular reason why you didn't know the debt was outstanding? (which could be used in trying to negotiate).

forgotmyname

You can ask but they wont have to remove it. It will be gone after 6 years though.

J5891

Thanks for the replies.

The default was registered in July 2012.

We switched current accounts and then the overdraft was removed due to this. The correspondence for chasing the debt was sent to our old address.

I guess we should try and settle the full amount.

Tixy

Its worth a shot to ask them if they may remove it, explaining that you didn't realise there was a debt outstanding on the account and so hadn't updated your address details with them.
Mention that you have only just discovered the debt was outstanding and are immediately trying to rectify the account.

(its a slim chance but worth a shot).

Thrugelmir

J5891 wrote: »

I guess we should try and settle the full amount.

If you wish to obtain a mortgage at some point in the future. Then yes. As soon as possible I should add.

Doesn't look good to a potential mortgage lender that you forgot about an overdraft. Particularly when you wish to borrow £'000's.

As for the default its on your CRA file for good reason.

J5891

OK. We will contact HSBC and settle the full amount.

I will also find out whether the default can be removed.

It's just frustrating because its genuinely a mistake and not an attempt to avoid re-paying a debt. We have been overpaying our mortgage for the last few years, don't have any credit cards or unsecured loans so we are 99% of the time good with our money and as a result a reliable borrower.

I imagine we will gain little sympathy because of the Default but its frustarting that we are effectively black-marked for the next 6 years from most high street lenders.

Thanks for the advice and will update once I have a result.