Ruined Credit Score

Grimlock10

Hi,
I'll just quickly run throught the basics, as this may be a non starter anyway, but if anyone has some advice, it would be great, even if it's just to say I'm stufffed :-)

A while ago, my partner went with a debt consolidation company called Money Worries, all was fine, they agreed to pay her creditors each month whilst she paid MW, and told her to ignore any letters she got from creditors, as it was very common due to the transition between her paying them, and Money Worries paying them.

Anyway, she did as instructed, but weeks and weeks went past and she started to get demand notices. Of course after this she got in touch with each of her creditors, and it turned out, that not ONE comapny had been paid, nor had they any information regarding Money Worries taking over the payments.

Now, she has obviously entered into agreements with each of her creditors, to pay the monies due, however although this was a few years ago, her credit rationg is literally in the toilet! Even though, she is on a relatively high income now she is slowly but surely paying back these built up debts, but she can't even get a £1000 loan (this is an example, she is not looking for a £1000 loan).

Is there anything that can be done to repair a credit file that has been so damaged by another companies incompetence, or is she basically screwed because of them?

I realise there are ways to slowly improve a credit rating, but this seems soooo unjust, because she would have never defaulted on a single payment, she only went with Money Worries, as they consolidated her debts, and would have made it a lot easier and on a monthly basis, cheaper than paying them individually. If they had paid her creditors.

I did search the forum for an answer on this, but nothing seems to quite fit specifically.

Thanks for reading

The_Boss

She doesn't have a credit score/rating as these do not exist.

Has she checked the data on her Experian/Equifax reports? This will give clues if there are any defaults recorded against her. If it is just lots of late payments then time will be a good healer - the older they get, the less impact on lenders decisions to lend to her.

Tixy

What you are describing is a Debt Management Plan (DMP) with Money Worries, not a consolidation of her debts.

A DMP is when you propose to pay your creditors less than the agreed contracted payments. Therefore it is pretty much inevitable that on a DMP that you will have defaults issued and wreck your credit file.

All DMP providers should explain in detail how a DMP works and the impact it will have on a person's credit file, although some seem to be less explicit than others.

It sounds like she is now self-managing a DMP herself and she really shouldn't be looking to take out any further credit until she has repaid her existing debts.

In time as she repays these debts and the defaults recorded on her credit file get older then she will find her ability to get credit improves. If this all happened a few years ago then are the default dates on her file all a few years ago? defaulted debts drop off your credit file 6years from the date of default shown on file.

In terms of the agreement with money worries - how many months did she pay them for? It is typical for commerical DMP providers to take the first 2 or 3 payments as their set up fees, which her paperwork should detail. If she paid more than that and they did not pay her creditors did she complain and ask for a refund?

Emmzy01

She needs to make sure they are all defaulted if it's going to take more than 6yrs to clear them. If they use arrangement to pay markers they stay on a further 6 yrs after the debt is settled. I paid everything back but because one creditor used those markers rather than a default I won't be able to get credit for a further 6 yrs after being debt free. A nasty sting when you've tried to do the right thing.

Experian_company_representative

Hi Grimlock10,

Once your partner has viewed her credit report she would be able to add a notice of correction to it to explain how the late payments/defaults occured.

A notice of correction is a brief statement (under 200 words) that you can add to your report to provide additional information for lenders.

Having a notice of correction on a report causes the report to refer out of any automated decsion making process, so that an underwriter can read the notice, and then take the information into account should they wish.

You can find more about notices of correction and how to add one here.

Kind Regards
Neil