Missed Payments / Collections - Improving Credit Score

dotcom89

I had taken three unsecured loans about 24 months ago when I needed a new car to get to and from my self employed jobs. A few weeks after this two of my biggest customers went under basically over night and it wiped out around 70% of my income.

I started missing payments and had collection letters coming every few days and stupidly just ignored two of the companies and setup a lower payment schedule with one of them. I'm based in Scotland so didn't really have to worry about debt collectors.

I had a really terrible 12 months following all this but things have really picked up in the last 6-8 months I could fully pay off these loans in one go just now, however when I called Sainsburys Finance and Likely Loans they have no record of me on their system now and they said it will be with a debt collection agency.

What does this mean? I read online that paying the money back to a debt collection agency won't make any difference to my credit score.

Can anyone offer any tips on improving my credit score over the next year or so as my partner are looking to buy another house and I really need to up my credit score, but i'm afraid those missed payments and defaults on my record will tarnish any hope I have.

Is there a way to get these missed payments / defaults removed if I agree to pay off the full amount in one go.

Hope someone can offer advice.

RecentPost

Creditors have a responsibility to record the correct details on your credit report. In most cases they do not remove late payments/default markers. You can of course write to them and ask but its completly up to them.

Have you checked you credit reports its likely the new creditors are there. DCA's can and will report default status on your credit report.

First step is to check your credit report.
if the debts arent there check any mail you may not have opened.
Secondly if the they have the sold the debts you need to find who to if you cat locate contact the original provider and get the information.

Debt collectors who have purchased debt have the same rights and can take further action to collect I.E CCJs and so on.

sourcrates

dotcom89 wrote: »

when I called Sainsburys Finance and Likely Loans they have no record of me on their system now and they said it will be with a debt collection agency.

What does this mean? I read online that paying the money back to a debt collection agency won't make any difference to my credit score.

.

You should be wary of what you read online, a lot of it is complete buncum.
There is a distinction betwen a debt collector, and a debt purchasor, the former just acts on behalf of their client, and cannot report to your credit file, the latter inherits all rights and privilidges of the original creditor, so can report to your file.


First off, that thing you call a credit score, is just a made up number basically, its what the credit reference agencies use as a marketing tool.


Creditore/lenders use their own scoring system that no one else is privy too, in order to make lending decisions, so although your credit score mat reflect the level of risk you pose to a potential lender, its not a number anyone else ever sees, except you.


To improve your credit profile, you should just do common sense things, such as make payments on time, dont default, be on the electoral role, have a stable address history etc etc.