Defaulted student loan sold, can they put back on credit file?

pbs84

Letter from Erudio Student Loans to say they have bought old student loan debts.

These had a default recorded on credit reports by the student loan company that has dropped off after 6 years so no account or default shows now. Those student loans were brought up to date a year after the default and have been ok and deferred successfully since.

The letter says that Erudio will report the loans on credit reports? Surely if they have already been reported once with a default that has now dropped off, they can't report them again with any status? Would the credit agency just remove them if they tried to put them back on? Surely they should as they'd have removed them onece already for the default being over 6 years?

Thanks for any help

Experian_company_representative

Defaults should only be registered once so please let us know if you find one that has been re-recorded with a more recent date.

James J

pbs84

Thanks.

What if they just reocord it as a normal up to date account though?

pbs84

Anyone?

Erudio are appently Arrow Global who from what I can tell can't be trusted one bit.

Experian_company_representative

No, they can't do this. It isn't a new credit agreement.

James J

pbs84

Thanks James.

One final question. If they did do this and I point it out to Experian, will they take it off the report without argument? Or would I have to dispute it with Erudio?

pbs84

Any answer james?

Experian_company_representative

Sorry, just saw your earlier messages. If a lender registered an incorrect default we would certainly help you rectify it.

I posted the above messages before I was aware of the discussions Erudio was having about registering additional data with us, namely about loans in deferral and loans now being repaid. We'll check out the issue of accounts defaulting twice but I really do not think you would see a second default on your credit report.

James J

Experian_company_representative

I promised to look into this issue and I can now provide clarification. To recap, in relation to student loans and credit reports, there's been a discussion and a degree of concern over whether accounts that defaulted in the past can, if sold on, be defaulted again by the new owner in the future and recorded as such with the credit reference agencies.

We've sought clarification from the Information Commissioner's Office on this and they have confirmed our view that a credit agreement can normally only be recorded as defaulted once on a credit report for a period of six years. If the debt is sold on within this time the original default entry is marked with a 'debt assigned' or 'debt assigned to CAIS member' flag (Experian terminology). The latter is used when the new company is also a data sharer and it can then register a record of the default, same date and amount, in its own name. The flag on the original entry makes sure the default is only counted once in credit rating calculations and other assessments. But, importantly, once the six year period expires the account cannot be registered as a new default again in the future, either by the original lender or a new company.

I hope this clarifies the situation. Erudio has now been made aware of this and ICO has issued new advice to its own advisers.

James J

fermi

Thank you James.

I've had a few people in touch over this, and they have been very concerned whereby the ICO had told them that it would be OK to add another new recently dated default to sold on accounts once the original had dropped off.

Very glad to see that this was incorrect information.

Thanks for your efforts in investigating and clarifying this. :T