Default - Where do I stand please?

jvh19

Hi everyone,

I am just looking for a bit of help (and honesty) with an issue I am facing.
Last year I made the decision to switch my personal current account. I advised my new bank that I had an overdraft with Halifax (that I was currently in) and they advised that there should be no problem with me setting up a payment plan with them.
I then visited my local Halifax branch and told them of my plans to switch. I was told I would have no problem setting up a repayment plan with them which I could do after the switch took place.
Lo and behold, I switched (using the ever so helpful switch service) and a few days later Halifax contacted me to say my account was now closed and they demanded the overdraft amount back in full! I wasn't financially in a position to pay it and felt upset that I was misinformed.
I contacted the complaints team who allowed me to set up a payment plan however said the standard procedure would be to send it to collections and they would make the decision on if a default was to be applied. I did everything I could to pay it back and in 6 months I had completely settled my account. I was told over the phone I may potentially get a default but if I continued to pay it on time I may not get one.
I am now in the process of looking at getting a mortgage with my partner and I have checked my credit file to see a big DEFAULT holding me back. It does show satisfied but this still doesn't look good!
It really upsets me because had I have not been given the incorrect information I would never have switched bank. It is the only financial issue I have experienced and the only thing on my credit file holding me back.

I never received a default notice - which from researching online I should have done.
The other thing that I don't understand is under the credit report the default is registered with a CIAS code 8 (which seems to be the worst!) and thats defined as 'The relationship between the consumer and the lender has broken down to an extent that the lender has suspended the account because the person has not paid or made any satisfactory arrangements to pay back what they owe!' which is completely untrue! I made the decision to switch my account (I didn't realise it would close!) and I made satisfactory arrangements as soon as I could communicating with them at all times.

As mentioned previously the account is now settled. Do I have a leg to stand on?
I have complained to Halifax again who have opened a case but I am just wondering if anyone can offer any expertise or advice if they come back and refuse to help me further?

Thank you very much.

sourcrates

Hi,

Why on earth did you switch banks when you had an outstanding overdraught that you could not pay back in full ?

The bank staff were incorrect in what they told you, and that would not of filtered through to head office anyway.
I'm surprised they let you switch with an outstanding debt, the bank would, naturally, want there money back, and it would be normal practice for this to go to collections, so you will always run the risk of a default unfortunatly.

Anyway, you have done the only thing you can do, and fired in a complaint, they may find in your favour, they may not, lesson for next time.

jvh19

Thanks for your response sourcrates.
Honestly it is a big life lesson and I can't answer your question of why I switched with an outstanding overdraft. It wasn't one of my best decisions.

Update - after numerous phone calls with Halifax they have agreed to remove the default and have apologised for the misinformation provided so a positive result and a big lesson learnt! x