Payday loan removal - don't even want a refund!

XEO25

Hello

I recently discovered an account with a debt collector on my credit file (it was on Equifax only, which I didn't have an account with) for a unpaid Payday loan from Feb 2015. The account is showing as 'in arrears for 5 months' and has been showing this since Feb 2015.

I need this account removing as I'm about to apply for a mortgage and this is the only bad mark on my credit file in 12 months.

I've been reading the Payday loan reclaim guide as I was definitely mis-sold (I was in a payday loan trap / very low income). I think this is my best option for getting the account removed from my credit file.

My question is - would the matter likely be resolved faster if I wasn't requesting a refund for any interest / fees - but simply for the lender to accept that the loan was mis-sold and to remove it from my credit file? I know there's probably a good few hundred quid to be made via a refund, but my main goal is having the account removed from the credit file ASAP (ideally <1 month).

Thanks to anyone who can help

EDIT: sorry I should have added, even though this particular loan was not repaid (and is therefore with a DC in arrears) I did have 5 other loans previously with this company which were all paid back in full.

Willing2Learn

The only way you stand a chance of the account being removed from your credit files, is for your complaint to be fully upheld. Otherwise you will have to wait for the full six years from when the account is settled. If your complaint is not upheld then you will need to escalate to the FOS, which means a lengthening of the complaint process.

You can still get a mortgage with adverse data recorded on your credit files. You would have to go through a good mortgage broker though, instead of a high street bank.

XEO25

Willing2Learn wrote: »

The only way you stand a chance of the account being removed from your credit files, is for your complaint to be fully upheld. Otherwise you will have to wait for the full six years from when the account is settled. If your complaint is not upheld then you will need to escalate to the FOS, which means a lengthening of the complaint process.

You can still get a mortgage with adverse data recorded on your credit files. You would have to go through a good mortgage broker though, instead of a high street bank.

Are you saying if I only request confirmation of the loan being mis-sold and removed from credit file, but not request a refund, it will not be 'fully upheld'?

Willing2Learn

I think the refund is a part of the complaint. If you are saying the funds were lent to you 'irresponsibly' and without adequate affordability checks, then consideration of a refund would automatically be part of the complaint process.

boo_star

The chances of getting anything removed are practically zero.

"Missold" or not, the fact that you took out a PDL is a fact, and arguably removing it from your credit file would be a breach of data protection laws.

Willing2Learn

boo_star wrote: »

"Missold" or not, the fact that you took out a PDL is a fact, and arguably removing it from your credit file would be a breach of data protection laws.

I don't believe that is correct. Some MSE members have reported that the applicable account was removed from their credit files as a part of the complaint resolution.


Edit: According to the FOS:

... If we decide that someone's pattern of borrowing has become clearly unsustainable, we’re likely to tell the lender to get these removed from their customer’s credit file completely.

Source : FOS

XEO25

boo_star wrote: »

The chances of getting anything removed are practically zero.

"Missold" or not, the fact that you took out a PDL is a fact, and arguably removing it from your credit file would be a breach of data protection laws.

If the account is agreed to have been mis-sold, the lender must remove it from the credit file.

Looking at the literature on MSE, it looks like many users have had their accounts refunded as mis-sold.

Based on the above facts, I'm not sure how what you're saying can be true? Sorry if I've missed something - this is a new world to me

boo_star

Willing2Learn wrote: »

I don't believe that is correct. Some MSE members have reported that the applicable account was removed from their credit files as a part of the complaint resolution.


Edit: According to the FOS:
Source : FOS

That would still very likely breach the DPA. I have no idea why the FOS are advising that.

Paul_DNAP

the FOS are advising that because they have said that this is what pay day loan companies must do in the event of a product being declared as missold, i.e. they must remove references to it from the credit reporting agencies as though the loan never existed in the first place as far as the credit reference agencies are concerned.


I don't know which part of the DPA you think it breaches, but it doesn't.

boo_star

Paul_DNAP wrote: »

the FOS are advising that because they have said that this is what pay day loan companies must do in the event of a product being declared as missold, i.e. they must remove references to it from the credit reporting agencies as though the loan never existed in the first place as far as the credit reference agencies are concerned.


I don't know which part of the DPA you think it breaches, but it doesn't.

accurate and, where necessary, kept up to date

Is failing to report the existence of a loan "accurate"?

I'd argue not. Obviously some other people would argue yes.

It's certainly not in the spirit of the DPA, in my opinion.

Paul_DNAP

The DPA will cover that the data that the loan company holds about the OP be true and accurate. And they will no doubt be keeping a true and accurate record of everything they have ever done with the OP.


However, if the account is struck off the credit reference report by the FOS then that will be recorded accurately in the loan company's data, and it will be recorded accurately in the credit reference agencies data, but it will not be shown in the credit reference agency reports.


So no breaches at all.