What would happen if

Jobber_Jones

If someone with a average credit rating took out say, 4 credit cards with a total limit of £12k and then spent it all, could they then approach the lenders and say they couldn't afford to pay, default and set up payment arrangements?

Obviously the credit file would be wrecked, but would there be any other repercussions?

[Deleted User]

A poor credit file could cause existing lenders to change terms or withdraw credit and it would make getting future credit much more difficult.

Some people's work require a squeaky clean file, so that can be a problem.

If fraud was suspected, that could be another issue, but that's generally unlikely without good cause.

Jobber_Jones

What does "withdraw credit" mean, they can request that you pay it back immediately?

[Deleted User]

No. Lower limits, cancel cards.

boo_star

I wouldn't be surprised if you ended up with a CIFAS marker.

[Deleted User]

And why would one consider even doing such a thing?

Willing2Learn

Jobber_Jones wrote: »

If someone with a average credit rating took out say, 4 credit cards with a total limit of £12k and then spent it all, could they then approach the lenders and say they couldn't afford to pay, default and set up payment arrangements?

This is not a plan that anyone here would recommend. It would be an example of a pretty reprehensible attitude toward meeting ones contractual obligations. A very bad idea...

Edit: I just read your other thread. It appears you are in a pretty bad financial situation. I recommend posting your SOA on the main DFW board to see if there is anyway we can help with your current predicament

Ben8282

Credit rating and ability to pay are two different things.
If you claim inability to pay the card issuers will want details of your change in circumstances and, if the change in circumstances is genuine and you have not lied about your income when applying for the cards, may even initially be sympathetic if they genuinely believe you have suffered some unexpected misfortune which means that you now have so little money coming in that you can't afford to make even the minimum payment. If this were to occur shortly after taking out the cards and spending up to the limits they would be highly suspicious and would wonder if you knew about the change in circumstances in advance which is why you did what you did or if you had lied about your income or something similar that they could class as fraud.
Assuming that you could convince them that there had been no fraud and avoid a CIFAS marker, your credit files would be showing AP markers and/or defaults, you would find obtaining further credit next to impossible and would have to put up with constant contact with DCA's trying to get you to pay more each month and so on.
A very foolish plan which is not recommended.

Davy_Jones_II

This would be a clear case of fraud, a criminal offence.

phillw

Jobber_Jones wrote: »

What does "withdraw credit" mean, they can request that you pay it back immediately?

I'm sure I've seen that in terms and conditions over the years. Of course they can request it, but if you can't pay it back then that won't get them very far.

You clearly want to commit fraud, the criminal repercussions should put you off.

They won't just take your word for it that you can't afford it and let you off.

Missus_Hyde

If someone with a average credit rating took out say, 4 credit cards with a total limit of £12k and then spent it all, could they then approach the lenders and say they couldn't afford to pay, default and set up payment arrangements?

Davy_Jones_II wrote: »

This would be a clear case of fraud, a criminal offence.

And no doubt you would also scream "irresponsible lending" and want to claim compensation from the credit card companies for letting you have the money to enable you to commit fraud?:huh: :doh: