Credit card informal agreement resulted in default on credit file!

Jen7

Hi

I am looking for some advice. My credit card interest free credit period finished and I was unable to make the new payments. I spoke to my bank who I have the credit card with (Halifax) and they suggested an informal agreement for six months with 0.05% interest with a payment amount I could afford. After a few months I received a letter stating my case had been transferred to a debt collection agency as I hadn't been able to make the agreed payments. This was news to me so I called Halifax, and eventually was informed that my 'agreement' meant that I would receive a default on my credit file lasting 6 years. This was not explained to me at the time and the operator stated this cannot be changed now and suggested I contact the debt management company to arrange a payment plan. I was not made aware of this default when I initially called up and I would rather have struggled with the payments than accecpt a default for 6 years!

Im not sute sure what to do now? My chances of getting a mortgage in the next 6 years is ruined!!!

Jen7

chattychappy

Are we talking about a "default" or just late payment markers, or perhaps an "arrangement to pay"?

Either way, you have made an arrangement because you said you couldn't meet the payments. The credit agreement will undoubtedly make it clear that information such as this can be passed to agencies.

CRAs "work" because accurate information is passed to them. It defeats the purpose if people could agree with a lender that something is not reported. I appreciate that this is bad news for a mortgage application, but (sorry to sound harsh) why do you think a mortgage lender shouldn't know about your failure to pay the CC within the agreed terms? Incidentally, just because something is on the record doesn't bar anyone from lending to you. It will be considered with other factors and may result in, for example, credit being offered at a higher price to reflect higher risk.

But I do feel it unfair if despite your sticking to the "informal" agreement they have now escalated it in some way.