Experian and Student loan

Charity1933

:(Hi I have recently become aware of a default on Experian issued by the Student loan company.
The default date is in 2012 with an update entry in 2013. The loan was taken out in April 1998. I contacted the SLC who stated they have never defaulted me, the account is currently £0 balance. The amount showing on Experian also do not tally with there figures. During 2012 there was a delay in deferrment and arrears accrued, which was subsequently paid, the deferrment was put in place. However it went to another company until the arrears were paid, they told me at the time as this had happened only once, that it was not a default and SLC managed the account again. Please help can this be completely removed ? How do I get this sorted from what I read now its on Experian they can make amendments, but it will stay on there until now until 2018. I am very distressed by this. Any advice will be greatly appreciated.

Tixy

The entry on your file - does that state it is the SLC? or the name of another company (perhaps the 3rd party that was involved until the arrears had been paid)?

When you contacted them was that by telephone?

If it is in the name of SLC then so I would write to them to ask them to remove it, and also dispute the entry through experian.

It is possible for whoever is reporting the entry to remove it.

Charity1933

Thanks for replying Tixy, the entry made on Experian has been made by the Student Loan Company. And yes I contacted them by phone and now sent an email to their customers services for investigation

fermi

I suspect the SLC could have been referring to a default notice under the consumer credit act 1974, NOT a default on your credit file, when they told you it wasn't a default?

SLC staff beibg unaware of, or confused on the difference, would not surprise me, and is something I've seen before.

CRA Default on a credit file Vs default under the CCA

I was not sent any default notices, should the default on my credit reference file be removed?

In most cases, the answer will be ‘no’, provided that adequate fair processing information was provided when the account was originally opened.

It may help to explain that a “default” on an individual’s credit file does not mean that an individual has been defaulted under the Consumer Credit Act; essentially, the same word is being used to describe two slightly different things (which can obviously lead to some confusion). Instead, a “default” on a credit file simply means the lender considers the relationship between itself and the individual to have broken down.

Therefore, whilst it may be a requirement of the Consumer Credit Act to issue default notices, there is no DPA obligation on a lender to issue a default notice to individuals before marking an account as being in default on their credit file. Although we advise that it is good practice to issue a notice, lenders will often have provided individuals with fair processing information about defaults and notices in the terms and conditions when the account was opened. Provided this was the case, then it is likely to satisfy the “fairness” aspects of the first principle.

So if you had built up arrears and the account had been passed to debt collectors for a short time, then you would likely have been within the legitimate criteria for a credit file default to be placed, even if they had not issued a DN under the Consumer Credit Act by that point.

A "breakdown" under the definitions of the time could have been said to occurred, even though the arrears were eventually cleared.

The definition of a default

9 A ‘default’ can be said to occur as soon as a borrower fails to meet the terms of their credit arrangement. However, adopting this definition for credit referencing purposes would create difficulties since it is accepted that not all these defaults should be reported, for example, where weekly payments are late but are quickly remedied.

Quote:
The term ‘default’, when recorded on a credit reference file should be used to refer to a situation when “the lender in a standard business relationship with the individual decides the relationship has broken down” 2.
2 Definition of ‘Default Data’ from ‘Information Sharing – Principles of Reciprocity’ available from credit reference agencies or at http://www.experian.co.uk/corporate/...ing/index/html

Where there is an unresolved dispute about whether a default exists, lenders should refer to paragraphs 42 -45.


10 Indicators of a default

The following indicate that a breakdown has occurred in most types of product (excluding those in the section on Exceptions at paragraphs 12-15). This list is not necessarily exhaustive.

• The account has been referred to a collection agency or in-house debt collection department.
• The account has been referred for legal action.
• The account has been included in a bankruptcy, IVA, or similar.
• The asset financed has been repossessed or instructions for repossession have been given.
• The lender takes or has taken steps to cut off the service provided (or would do so if they were not prevented on social rather than commercial grounds or by other regulations, codes of practice or statute).
• The customer has not made satisfactory proposals in response to a demand for repayment.
• The customer has given a clear indication, for example, by handing back an asset, that they do not intend to meet their contractual obligations.
• The lender has evidence that an account has been opened or used for fraudulent purposes by the applicant.

Not saying that you might not be able to argue against it on the basis that they went too soon on those criteria as well, but you need to know the difference and what basis to argue from, as as said you and the SLC could have been referring to very different things at the time by mistake.