Is is better to have a default on your credit file?

Hayley_Byrne

Hi I have an outstanding payday loan with PaydayUK on my credit file of £250 which I have never made a payment on, please don't judge me on this I got myself into a right mess 6 years ago and genuinely thought I was paying all of my debts off, they have never chased me for money. I recently signed up to Experian to check my credit file as I would like to get a mortgage next year, this is one of the last debts remaining on my account however rather than it being registered as a default which would drop off my file soon, it's just showing as an active credit file showing a constant late payment ( now classed as delinquent) am I right in assuming that this won't drop off my credit file in the same way as a default? In which case what is the best thing to do in order to improve my credit score? I am now able to pay the debt off, although maybe not in one go.

Thank you for your help

bengalknights

The default would have been better as it would drop off where as this just shows you as constantly late paying

Hayley_Byrne

So is there anything I can do about this?

bubblewrapped

Hi Hayley,

I would query this with Experian. Send them your explanation and ask why the account is still showing as active and why there is no default date shown as it has been xxx many years since.

They will then raise the query with the lender. They cannot keep accounts open indefinitely.

Experian_company_representative

Hi Hayley,

If an account is still open in a delinquent status its classed as active so will be on the report indefinitely while open. Once its closed it will be removed automatically 6 years after its closure date.

If the account is currently displaying on the report incorrectly and should have originally been recorded as a default, we are able to query the account with PayDayUK for you.

You can contact us here and we can look in to this further for you.

Thanks
Joe

National_Debtline

Hi

Defaults should be registered within 3- 6 months of contractual payments being missed, so you have a case to argue it should have defaulted years ago. Follow Bubblewrapped's advice and also check your credit files held by Equifax and Call Credit, in case you also need to resolve the issue there too.

James
@natdebtline

Hayley_Byrne

Hi I've already queried it through Experian, they contacted Paydayuk who advised the information was accurate!! So understandly Experian can't go anything about the record.

Hayley_Byrne

Also forgot to mention the account had a note next to it saying debt management plan but we have never been in one, would this explain it?

National_Debtline

Hayley_Byrne wrote: »

Also forgot to mention the account had a note next to it saying debt management plan but we have never been in one, would this explain it?

Quite possibly, although it's incorrect from what you've said. If a debtor has a payment arrangement agreed with the creditor they may not show a default on the credit file. In your case there wasn't an agreed payment plan so it sounds as though a default should have been registered.

To take this further now you should put your concerns in writing to Paydayuk. If they don't resolve your issue you can then complain to the Financial Ombudsman Service and Information Commissioner's Office.

James
@natdebtline