Closed Accounts and Default Entries

Jamesx81

Hi

If a creditor decides to close an account leaving a zero balance how should this be reported to the CRA's?

Should it be updated to show the account now closed?

Thanks

[Deleted User]

Yes. .

sourcrates

As above, why have they marked it something different ?

Ben8282

Jamesx81 wrote: »

Hi

If a creditor decides to close an account leaving a zero balance how should this be reported to the CRA's?

Should it be updated to show the account now closed?

Thanks

YES

However the title of this thread implies that this is not what happened.
If you DEFAULT the account and then pay the defaulted amount, the default will remain for 6 years although the status will be showing as settled.

mwarby

Or if settled for less than the full debt (through say bankruptcy a DRO or IVA), it might get recorded as partially settled. This still means closed with bill balance

Jamesx81

Thanks for the replies.

Just to be clear this is not an attempt at having a default removed I understand its there and will remain so until the time is up.

It is me finding out the correct procedure a creditor should take.

The creditor has decided to write off the debt, close the account with a zero balance and this what they informed me.

However they have also informed me they are going to continue to report the account as open with the balance still outstanding and have been doing so since it was closed in July.

I emailed them with the following in response:

Just so there are no mis-understandings could you confirm:

1) You will not be updating my credit file to show a true reflection of the account as it stands today.

2) You will be continuing to report a closed account as still open with an outstanding balance.

To which the confirmed yes they will be doing so.

Im just trying to get my head round how a closed account can be still reported as open?

[Deleted User]

If there's an outstanding balance, it will remain technically open, even if they have written the amount off.

Jamesx81

I understand that and can see the point but a credit file should be an accurate reflection?

I either owe the money still and they report it as such or the account is closed and I no longer owe anything?

By keeping reporting as they are my credit file is showing I owe the money but in reality no longer do.

[Deleted User]

It shows you still owe the money but they have decided not to chase you for it.