Impact of Arrears on Credit File

beanie1967

This is my first post so I apologise if it comes across a little disjointed.


Over the last year or so I have had some financial difficulties due to changes in circumstances and although I have managed to keep most of my payments up to date (credit cards, mortgage etc) I have a Bank loan that I had to reduce the payments on. In discussing this with the Lender, who have been very accommodating, there were two separate months where the Lender said I could defer the whole payment. I need to understand how each of these situations are treated as part of my credit file, if they are in fact treated separately, as my credit rating has taken a massive dive. Before this I had never missed a payment previously. The questions are:-

1. Where payments are reduced in agreement with the Lender, arrears will accumulate. Does this have a negative impact on my credit file and if so, does this negative impact remain until the arrears are repaid or is it longer?
2. Where payments are missed, again with the agreement of the Lender, does this have an even more negative impact ie the same as I simply refused to make a payment? How long will this remain on my credit file?
3. I intend to go back to the full payment in April though I will not be able to afford paying more to reduce the arrears for some time. What, if anything, would provide the best impact on my credit file?
   • Try to agree an extension to the loan and pay the arrears effectively over the extended four months. This may prove difficult if it means effectively getting a new loan over a different period due to my current credit rating
   • Pay the full amount and make ad-hoc payments as and when until the end of the loan. The difficulty being that I may not have cleared this over the duration of the loan.

I apologise this has proved longer than I thought. I have been through a number of threads about this but could only find generic advice and the impact that I have had on my credit file means I have the worst rating I have had ever!! The Lender has been great and it is my fault for getting into this mess but I am looking for a positive, effective direction to resolve the issue if possible.


Any advice you can provide would be greatly appreciated.


Thank you

[Deleted User]

Arrears are damaging. But it depends how they appear on your credit file.

All you can do now is clear the arrears as soon as you can and stay on top of your payments going forward.