Mortgage Default/Arrears?

walter_plinge

Earlier this year, I somehow manged to not have enough money in my current account to cover my mortgage payment with the Nationwide. I didn't realise this until they had sent me a letter, to which I responded to by depositing the required money straight into my mortgage account over the counter at my local branch. I would guess (I'd have to dig into my records) that the payment was approximately 10 days after the original direct debit was due.

My credit record now shows a missed payment on my mortgage. This is the only time that I have manged to miss a payment on my mortgage in the seven years that I have had it. I feel somewhat annoyed by the default showing on my credit record. What are your opinions? Is there usually a 'grace' period after which a bank / bs will deem the account to be in arrears? I pay my mortgage towards the end of the month.

Badger_Lady

Presumably you just have a "1" (1 missed payment) on your credit record - a default is an "8".

Sadly, if the payment was late, it will show on your record. I don't know if there are normally any grace periods - someone here will know better!

However the odd "1" or "2" will not make a significant difference to your rating. It's annoying to have an imperfection, but it won't change your life!

Leon_W

Seems a bit harsh to me as you immediately put things right. It does seem to vary from one lender to the next as to what they construe a missed/late payment to be as, even I, cocked up a payment not so long back with my own lender, The Halifax. They were very good, said these things happen and I paid by debit card. No late/missed payment recorded.

If I were you I think I'd be on the phone to them.

regularsaver1

I know the payment was 10 days later, but was it in the same calender month? if so I think they should take the marker off for you

wensleydaleuk

Badger_Lady wrote: »

Presumably you just have a "1" (1 missed payment) on your credit record - a default is an "8".

Sadly, if the payment was late, it will show on your record. I don't know if there are normally any grace periods - someone here will know better!

However the odd "1" or "2" will not make a significant difference to your rating. It's annoying to have an imperfection, but it won't change your life!

Are you sure about that? My credit score is now 350 points less than it was back in October. The only thing thats any different now is that I missed a couple of payments on my Next account. This was through sheer forgetfulness, no other reason (everything else I have is on direct debit for this exact reason!). As soon as I realised I cleared the entire balance. I only found out because for the first time ever I was refused a small amount of interest free (for my wedding rings as well the heartless people!). This prompted me to get a new credit report and I was shocked when I saw my lower credit score - can these things really make such a difference??

walter_plinge

regularsaver1 wrote: »

I know the payment was 10 days later, but was it in the same calender month? if so I think they should take the marker off for you

Unfortunately I pay my mortgage at the end of the month to coincide with pay day. The payment happened at the start of the next calender month.

Amme25

I don't know if this is still the case (someone please correct me if I am wrong) but every time you apply for credit it has an influence on your credit score. The principle being that if you applied for credit (of any kind) you could be approved and it was putting a bigger burdon on you to repay.

Could you have applied for credit for anything else that could have influenced your score i.e. how new is your Next account, applying for the credit on the rings, etc.

I was declined credit back last year. I have an excellent credit score (only because everything is on direct debit), never defaulted on anything, but had recently moved house and opened a few credit agreements for new household items. The only answer I could get back from the bank as to why they refused my very small loan was because of having access to numerous other types of credit.

walter_plinge

Amme25 wrote: »

Could you have applied for credit for anything else that could have influenced your score i.e. how new is your Next account, applying for the credit on the rings, etc.

Hi Amme,
Thanks for the reply. The problem is not that I have been refused credit, but that I have a marker against my mortgage payments in my credit file which could potentially lead to me being refused credit in the future.

wisbech_lad

Seriously, what do you expect? You DID miss a payment. Either because you did not have the cash, or because you were not organised enough to have the cash in the correct account at the right time. Either reason, IMHO, is a reason to reduce credit in the future. Why lend money to a unorganised person?

regularsaver1

walter_plinge wrote: »

Unfortunately I pay my mortgage at the end of the month to coincide with pay day. The payment happened at the start of the next calender month.

This is more understandable for the action they took then, because they did not receive a payment that month that is was required for

walter_plinge

wisbech_lad wrote: »

Seriously, what do you expect? You DID miss a payment. Either because you did not have the cash, or because you were not organised enough to have the cash in the correct account at the right time. Either reason, IMHO, is a reason to reduce credit in the future. Why lend money to a unorganised person?

Get a life you idiot!