Career Dev Loan, default advice sought.

claude_63

Hi guys, looking for some solid advice.

From looking online, in these forums and hearing from finance savvy friends I'm hearing conflicting points of view.

I want to take a part time course beginning in October to become an art teacher. It's not the kind of course that is paid for by the gov, I have to pay for it. I am intending on taking out a Career Development Loan from either Barclays or Co-op, although I had been refused (can't remember which bank) in 2009 for a CDL for a different course.

So I've checked in on my credit report with Exquifax and found a default from March 2009, with an unsettled amount of £23. Idiot.

Obviously all my own stupid fault, and this is the most likely reason I can see for being refused the loan. As far as I can see I have 3 late payments since then (one in 2010, one 2012, one in 2012) but not much else.

So skipping forward to present day, I had planned to settle the default in the hope this might help my case, but I have been advised that by bringing the default to light and adding new information and a new 'settle date', that the 6 year drop off period would start again. My source for the information seemed quite confident, but I have found contradicting information here.

Sadly though I fear any of this might not be enough.

The same person also advised that I might be able to talk to the banks directly and request a 'human approved' loan, instead of leaving it to a machine.

I feel trapped here guys, I had been an idiot youth. Paying for it at 27.

I have an overdraft which is paid in full every month, and a credit card capped at £300 (£250 used) that I'm slowly paying off.

Any pointers would be most appreciated. :heartsmil

-Claire

Tixy

The default drops off after 6years from the default date regardless of when/if paid.


If you apply for a loan and are declined you can appeal, which means that an underwriter will manually view the application and your file. Another way to ensure its a human decision not a computer decision is if you have a notice of correction on your file for anything. You might for example add a small explanation as to how the default arose.


That said with a default on your file, even though it is small, I think you will struggle to get accepted for a CDL.

longtermplanner

If you pay off the £23, the debt will then be marked as 'satisfied' - this is the word that is always used for debts which have defaulted rather then 'settled'. (Thsi is a small point but it seems to cause confusion so I mention it.)

You can also add a note saying you were unaware of the default and have paid it off as soon as you realised - for such a small amount his is very believable!

This debt will drop off your credit record 6 years after the default. The clock does not get restarted by your paying money towards it.

PS overpay that credit card! You know it makes sense!

claude_63

Brilliant, thank you

So just to summarise:

I should still pay off the default ASAP, to increase my chances. Attach a note to the default with a short explanation.

Then apply for the loan, and once the likely rejection comes through, take it further with the appeal.

...and I'm working on that credit card. :doh::wall:

Clive_Woody

claude_63 wrote: »

Brilliant, thank you

So just to summarise:

I should still pay off the default ASAP, to increase my chances. Attach a note to the default with a short explanation.

Then apply for the loan, and once the likely rejection comes through, take it further with the appeal.

...and I'm working on that credit card. :doh::wall:

I mean no disrespect but if you are struggling to pay off a £250 debt on a credit card and you use your overdraft every month do you really think that you will be able to manage repayments on a loan?

I have to ask so that you don't find yourself back here in a few months with a much bigger default on your credit file.