Confused and Cross!

sdw3075

Hello everybody, I'm a little bewildered with my credit scores on both Equifax and Credit Expert and wondering whether anyone can shed any light on this for me?


I am a homeowner, have been on the electoral register for the last 10 years. I have a credit limit of about £10,000 in total and am using about £2,500 of this. I make more than the minimum payment every month.


I used to have a rating of 999 until I lost my job back in 2012 and although I came to an arrangement directly with both of my creditors at the time (Tesco and Barclaycard) to make repayments to cover the amount outstanding (albeit at a slightly reduced rate) I kept to my payment schedule. Despite this, Tesco put a default notice on my account (Barclaycard didn't) but fair enough.


Thankfully I'm now back in work and had some money put aside which I used to pay off the last £1,000 off the Tesco credit card in October, which shows on my credit account as settled.


The issue is that since that time my Credit Expert score has gone down from about 920 to 881 (a score of good). I understand that this may have something to do with the way they view the reduced amount of credit available to me, however I wanted to get the card paid off and reduce my debt. The weird thing is that although both agencies hold exactly the same information, my credit score with Experian is 327, which is poor. I can't understand how two agencies could have my credit worthiness down as being so completely different, based on exactly the same information.


I am hoping to move home in the next year or so and entering into a mortgage with my partner (who has an excellent score by the way), and am scared of even thinking about applying for a new mortgage in case I get knocked back and this damages my score even more, as well as my partners


Many thanks in advance for any advice that anyone can offer

MuddyFunster

The first thing to understand is that the scores that the agencies give you are only an indication of what they think creditors will score you, even if they use a score at all – it’s usually pass/fail/check, most people on here consider them meaningless, they’re not really they’re an indication, but far from a universal score and it’s worth considering that the agencies make a lot of their money selling services to people who are trying to improve, or maintain a ‘good’ score – make of that what you will.

Secondly a default marker is a very black mark to any underwriter, settled defaults are better than outstanding ones – but they’re still bad. If I’ve read your post correctly you don’t deserve the Default marker – you should have a “arrangement” marker, providing you were on contact with your CC providers during your period of unemployment and worked with them and didn’t ignore it for months or anything. If that’s the case I’d certainly contact Tesco and ask them to review it, it seems unfair to me.

sdw3075

Hi, and thanks for your quick response


I contacted Tesco at the time and came to an arrangement to pay £50 a month at first and then upped this to £125 a month when I was working again, which was actually more than the minimum monthly payment. They passed my details on to Allied International, so all of my dealings from thereon in were with them. When I noticed that there was a default on the account I was confused, as I had done exactly the same thing with Barclaycard, but they had accepted the arrangement and nothing negative was placed on my credit file.


At this point I contacted Credit Expert to find out whether there had been some mistake, and when they looked into it they said they were also confused as although Allied were dealing with the case, the debt hadn't actually been sold to them and it was still held by Tesco.


I contacted Tesco, my argument being (probably wrongly) that if the account was still open and with them then was it really a default? The woman I spoke to was quite dismissive and said that it was the case that I still had an account with Tesco rather than the debt having been sold on, but that there was basically nothing they could, or would do about the default. A further phone call to Credit Expert confirmed this, and they said that lenders behave differently and that Tesco were quite entitled to put it down as a default.


I also thought that this situation was really unfair as I had come to an arrangement with them (admittedly there were a few months that passed when I didn't make any payment at all) and prior to that had a credit score of 999 and had never missed any payments.


Confused doesn't even come close!! :-D

Superscrooge

sdw3075 wrote: »

I also thought that this situation was really unfair as I had come to an arrangement with them (admittedly there were a few months that passed when I didn't make any payment at all)

Confused doesn't even come close!! :-D

When you took out the credit card, you will have agreed to pay at least the minimum payment each month. You state there were a few months when you didn't pay anything. That is why you have a default.

The fact that Tesco agreed to accept payments below the minimum amount doesn't alter the fact that you defaulted on the credit agreement

David_White

sdw3075 wrote: »

I kept to my payment schedule. Despite this, Tesco put a default notice on my account (Barclaycard didn't) but fair enough.

The numbered score credit agencies give you is meaningless, a lender doesn't see it. They give you a score in order to get you check your file every month..... and pay them £15.

The default and arrangement to pay are the entries on your credit file that could cause you an issue in the future.

That said, there is likely to still be lenders available to you so don't lose hope

sdw3075

Thanks both for your advice �� My default should go from my credit file in March 2018 so might just stay put until then. I'm thinking of asking my current lender whether they would consider giving me another mortgage as I've been with them for 10 years now so they will know better than any lender what my payment history is like (never defaulted on my mortgage). If not, I'm just going to have to suck it up but I know I'm probably a lot more fortunate than some pepole as I'm already on the property ladder

ViolaLass

MuddyFunster wrote: »

most people on here consider them meaningless, they’re not really they’re an indication,

Not much of an indication if the same info can cause two agencies to give such different scores.

pvt

MuddyFunster wrote: »

most people on here consider them meaningless, they’re not really they’re an indication, but far from a universal score and it’s worth considering that the agencies make a lot of their money selling services to people who are trying to improve, or maintain a ‘good’ score – make of that what you will.

So just how meaningful do you think a "credit score" is that is provided by someone who:
doesn't know what your salary is;
doesn't know what savings you have;
doesn't know why you would want to borrow money;
doesn't know what your partner earns;
doesn't have data from all the people you've previously borrowed money off; and
isn't in the business of lending money to people.

David_White

I wouldn't even say they're an indication of your credit profile.

Only recently I saw a report that was 998 with Experian yet there was a CCJ and mortgage arrears on there!

pvt

David_White wrote: »

I wouldn't even say they're an indication of your credit profile.

Only recently I saw a report that was 998 with Experian yet there was a CCJ and mortgage arrears on there!

Ahh. Mine is 999. But then I don't have a CCJ or arrears.

So I guess from that we can deduce these transgressions will knock a whole point off your "score"...

CalumHeath

MuddyFunster wrote: »

...most people on here consider them meaningless, they’re not really they’re an indication,

They're definitely meaningless - just so you know.