I am so angry right now because of defaults when I was paying!!!

S.D.Blake

Is there anything I can do?

So for the past 24 months I was on a DMP with StepChange, I was paying the minimum I could pay my debt collectors. But it says on my credit account that all the way up until last month and 24 months ago some of my accounts have a big fat red dot with DF or DM on them. But I’ve been paying the minimum I could afford through StepChange. I even paid each debt extra upfront beforehand so that when StepChange took the money from my account when I got paid - to not miss a payment as I know this is a common thing with StepChange and debtors - they all want paying on different dates!

I’m so upset what can I do???

MovingForwards

You can pay the original contractual amount to each creditor. But as you have entered a DMP you do not have the money to meet the contractual amount. Therefore they are reporting it correctly to the CRA's.

Sadly, it's what happens when on a DMP.

When your debts are settled you can then work on building up a new credit history, although many of us start to do that after several years by taking out a sub-prime credit card.

S.D.Blake

But why has "Cabot Credit Management Group Limited" for example and "Lowell" done that when large chunks have been paid (sometimes more money than the "original contractual amount") and others lenders haven't such as "Fredrickson International" haven't given me defaults.

The others apart from Fredrickson are Lloyds bank and Vanquis Bank Limited who didn't use debt collectors. It's only those two debt collectors and some were original contractual amounts. For example, Vanquis Bank Limited only wanted £5 or so a month, the minimum. Some of the "original contractual amount" were not possible to pay back hence them using a debt collector and then saying they never had my file on their system (Littlewoods for you - who kept adding interest for 12 months because they wouldn't speak to StepChange and expected you to pay £300, £400, £500 back per month), others like credit cards were like minimum payments / "original contractual amount" of under £50 a month.

Splatfoot

Can I ask if you could afford your contractual amounts to your debts why you entered a DMP? Apologies if I'm getting confused.

Suseka97

Okay - the very fact you entered into a DMP with StepChange meant that at some point you were not able to meet your contractual obligations, otherwise SC would not have set up a DMP for you. Once that occurred your credit file would have been negatively affected- whether the markers were AR. AP (arrangements to pay) or DM, DF (defaults). Any and all of them affect your credit worthiness in the eyes of a creditor.

So why are you so cross about it? A default is in fact a better situation for you because a default will be removed from your credit file 6 years from the date the default was registered, irrespective of whether you still owe money to that account. Whereas, an AP, or AR type marker will stay on your file for 6 years after the date you settle / satisfy the account - and so this can affect your credit file for a whole lot longer (if that's your concern).

sourcrates

S.D.Blake wrote: »

But why has "Cabot Credit Management Group Limited" for example and "Lowell" done that when large chunks have been paid (sometimes more money than the "original contractual amount") and others lenders haven't such as "Fredrickson International" haven't given me defaults.

The others apart from Fredrickson are Lloyds bank and Vanquis Bank Limited who didn't use debt collectors. It's only those two debt collectors and some were original contractual amounts. For example, Vanquis Bank Limited only wanted £5 or so a month, the minimum. Some of the "original contractual amount" were not possible to pay back hence them using a debt collector and then saying they never had my file on their system (Littlewoods for you - who kept adding interest for 12 months because they wouldn't speak to StepChange and expected you to pay £300, £400, £500 back per month), others like credit cards were like minimum payments / "original contractual amount" of under £50 a month.

Hi,


Sec 87, consumer credit act 1974 covers this, and can be found here :


https://www.legislation.gov.uk/ukpga/1974/39/part/VII/crossheading/default-notices


When you sign up to any credit agreement, there will be a minimum monthly payment that you have to make, so for example, if your payment is £100 a month, yet you only pay £99, then you are not paying the min contractural payment, its the same principle with a DMP.

Once you cannot afford the min payments, the creditor can issue a default notice, this document gives you 14 days to bring your account up to date, most people cannot afford to do this, so the account defaults.

Sometimes the creditor will not default you, but will apply AP markers instead, (its at their discretion).


Anyway, AP markers/defaults are all normal consequences of going into debt mangement, dosent matter how much you subsiquently pay the debt collectors, the damage is done once the original creditor defaults you.
All this should have been explained to you, and to be fair, the information is freely available on the internet, but surely the main thing here is that your debts are under control, your credit file will heal itself in time, and should not be your main concern to be honest.