Default

mtownend

Hi ,

I have recently viewed my credit file and noticed there was a default which i know about but on looking at the default the date was wrong. The account was marked as shortfall due to the mortgage not covering what was owed and the last payment date i think was 2008 / 2009. The default is down as 2011 i thought a default was registered after 6 months by law any advise welcome.

fermi

From 2005 ICO guidelines that would apply in your 2008-11 case.

14 Long-term secured loans

Although long-term, secured loans, such as mortgages, are likely to involve monthly repayments, they are an exception to the general standard. The existence of a secured asset which, if repossessed, will indemnify the lender, and the length of the term involved, distinguish this category from the majority of products. This may mean that the lender is prepared to allow the customer greater latitude if the account gets into difficulties. A lender may decide that, even though one or more of the above indicators has occurred or more than six months has passed without a payment being received, there is no breakdown until they have decided to take possession of the asset. Nevertheless, there are practical problems facing lenders in these circumstances because in some cases, even after court action to gain possession has been taken, a customer will go on to repair the relationship by starting again to pay on a regular basis the contractual sums (or at least an agreed compromise sum that would constitute a variation in payment terms as indicated in paragraphs 17 -23).

If meaningful information is to be reported to credit reference agencies there needs to be a consistent approach by lenders that also needs to take account of the practical problems they face. This is also necessary to treat all customers in this situation fairly. Consequently, a lender should file a default no later than six months after the date of a successful court application to proceed with possession unless

• the customer has made reasonable and agreed arrangements to repay,
• the lender can justify not filing a default on an exceptional basis. For example, the lender is fully informed of the circumstances and knows that payments will start again, or
• the loan has been included in a bankruptcy in which case the default should be filed in accordance with the guidance in paragraphs 47 – 48.

In rare circumstances the court can grant possession on conditions that delay physical repossession for a long period of time, even though the customer is not making an acceptable agreed level of repayment. This is usually on compassionate grounds. In these circumstances the lender should record a default within the six month period of the order date.

mtownend

So does this mean the lender can wait longer than 6 months to add the default. Does the same rules apply will the default drop off after 6 years

happy_bunny_2

Yes, the default will fall off after 6 years.

What were the circumstances regarding the mortgage shortfall? e.g. house sold, repossessed.

mtownend

The house was repossessed due to a split with my ex. I just dont know whether to contact the creditor because i dont want the default to change to 2014. The default is for around 9000 and its with ge money

Buzby

Different rules apply if a mortgage (secured on property) or if a personal loan - which is it?

happy_bunny_2

mtownend wrote: »

The house was repossessed due to a split with my ex. I just dont know whether to contact the creditor because i dont want the default to change to 2014. The default is for around 9000 and its with ge money

They can't change the date if it's accurate.

Best keep a copy if your file showing the current default date.

fermi

mtownend wrote: »

The house was repossessed due to a split with my ex. I just dont know whether to contact the creditor because i dont want the default to change to 2014. The default is for around 9000 and its with ge money

They should not change the original default date if it is correct. They cannot make it more recent.

mtownend

Hi , It was a Loan secured on there property.