Mortgage and current account guidelines

Movingon5464

Hello, i have been reading a lot recently on ICO guidelines regarding issueing defaults and have read that the 3-6 month guideline applies to credit cards and loans but not mortgages or current accounts with overdrafts. Does anyone know why these are treated differently ? And what are the guidelines for current accounts with overdrafts ? Thank you if anyone can clarify this.

Tixy

Guidelines on defaults being registered on your credit file are just that, guidelines.

Credit cards and loans are slightly different in that they are covered by the consumer credit act. So the specific reference to the requirement to send a default notice that is part of the consumer credit act does not apply to an overdraft account or mortgage.

The current guidance/principles is listed on this thread - https://forums.moneysavingexpert.com/discussion/3172602, which does not specifically mention a timescale of 3-6 months.
The older guidelines (up to the start of 2014) can be found on post #3 of that link and does give a list of indicators of a breakdown / default specific to a current account (section 15) and section 11 is the time framework that leads to the typically quoted 3 to 6 months.

sourcrates

Hi,
Different legislation covers current accounts, as you are not required to make regular monthly payments to the account, as you would with a loan, for example.
It can be difficult where these accounts are concerned, and does, somewhat depend, on the particular banks own policies.


I have known accounts stay dormant for many months, even years, before a default notice was issued, there would be a point in time, when the account has lain dormant for a specific period of time, where the bank would then take action, but again, its down to each banks own policy when this time limit would expire.