Not told about outstanding payment for 6 years - do I have any way to fix this??

boromanc89

Hi all,
I'd be grateful for some advice from the hive mind. Long missal, apologies.

I was recently declined credit (my husband is renewing his mortgage and we intend to get a joint one this time as we are now married etc) which led me to check my credit scores for the first time (I know I know, this was the wrong way round to do things, I am aware of that now).
My score with Experian was excellent, which was confusing. I then checked with Transunion, and discovered I had a below average score due to an old account with Halifax.

What I have discovered is this -

I switched my Halifax current account fo Santander in 2014 using the 7 day switch service.
The Halifax account was my student account, it was overdrawn 31 quid. I recall at the time being advised to pay this off from Santander, which I thought I did. Unfortunately, I have discovered a few weeks ago from looking at my historical payments that I put the wrong details in, using the Halifax sort code and account number as a reference, and transferred the money both from and to my new Santander account in a circular transaction. Idiot!

I presumed that this was all fine, I never heard anything more from Halifax about this account and the account disappeared from my internet banking screen. So I plodded on with life ignorant of the fact I had made a mistake when setting up the transfer, and the Halifax account overdraft wasn't paid off. I should have checked, I know, I know.

I have remained a customer of Halifax all this time, they have my address, email, phone number etc because I still have savings accounts with them. They have never contacted me about this, and they haven't handed the debt over to anyone else.

What is seems is that the overdrawn Halifax account has sat there dormant for 5 years, permanently overdrawn, thankfully not gathering any fees but month by month destroying my credit rating. Halifax can see this account on their system when I have called them specifically to ask about this, but I can't see the account on my online banking, and I have not received statements or anything to let me know the account is in arrears and therefore not 100% closed.

I've since paid the balance off, 2 weeks after discovering it (and after FOUR phone calls speaking to various departments who struggled to work out how to do so).

My credit score is bad with Transunion, and even worse with Equifax. Oddly fine with Experian (it is 991).
I have a good steady income and a lot of cash in the bank. This the only mark on my record, I've never knowingly missed a payment.

I have written a complaint to Halifax about this and am waiting for their response. I'm unsure what my options are here as I feel its fundamentally unfair that this has happened and it just can't be right that this can happen?? If I had received a statement telling me the account was still not paid off back in August 2014, I would have paid it and it would be 1 month missed payment at the most. It is instead FIVE YEARS but I knew nothing about it!

My husband and I intend to buy a new house in the next year, ironically I can provide a 30-40% deposit but probably can't get a mortgage as my score is so poor. My husbands score is good enough that he could get the mortgage in his name, but I need to improve my credit somehow.

Does anyone have advice? Namely -
A) What are my chances of getting this expunged from my record?? I am going to ask Halifax for this, but as it came from an account switch does the problem lie with my new bank? Should I try the Ombudsman if Halifax say no?
How can I improve my credit in the mean time? I have looked into getting a credit card but probably only stand a chance with CapitalOne etc (I stupidly closed my old Halifax credit card around the time this happened with an intention to get a new one, not realising that banks won't touch me). Santander will likely reject a credit card application although the adviser I spoke to said I could appeal as all of my other financial behaviour is spot on.


Sorry for the waffle, just panicking a bit that such horrendous credit is potentially going to dog me for 6 years when I was unaware of a 31 quid debt and (stupidly) I thought I had paid it off in 2015.

[Deleted User]

Your score has no bearing on your getting credit, so don't worry about the various numbers the CRAs are giving you.

A 5 year old default, now settled, isn't going to be a deal breaker. Use a decent broker if you're still concerned, or your wider situation is patchy.

It would be worth trying build some credit history for the future though, as it sounds as if you have a thin file, which may be a bigger problem.

boo_star

boromanc89 wrote: »

A) What are my chances of getting this expunged from my record?? I am going to ask Halifax for this, but as it came from an account switch does the problem lie with my new bank? Should I try the Ombudsman if Halifax say no?

Low. Sorry to say but you're an adult who should be responsible for their finances. Your credit report is a factual representation of how you've handled your financial affairs. A decent broker is likely to be able to explain it away anyway.

How can I improve my credit in the mean time? I have looked into getting a credit card but probably only stand a chance with CapitalOne etc (I stupidly closed my old Halifax credit card around the time this happened with an intention to get a new one, not realising that banks won't touch me). Santander will likely reject a credit card application although the adviser I spoke to said I could appeal as all of my other financial behaviour is spot on.

Obtaining some other form of credit, although with your history you should be looking at subprime lenders, not Santander.

xlnc99

There is no point in doing anything about this now. It this was in 2014/2015 then it will drop of your credit file automatically in the next year or so. Id leave it. The amount of time you spend with the FOS and complaints procedure it will probably take a 6 months - 1 year to get a final answer from them.

By that time it should have been removed from your file.

Nebulous2

boromanc89 wrote: »

Unfortunately, I have discovered a few weeks ago from looking at my historical payments that I put the wrong details in, using the Halifax sort code and account number as a reference, and transferred the money both from and to my new Santander account in a circular transaction. Idiot!

It's possible you didn't do that at all. When an account is switched any payments to it within the next 3 years will be transferred to your new account. You may have sent the money to Halifax and they sent it straight back. You could use that in your complaint to Halifax to try and get it removed.

This one account is unlikely to be causing the problems you think it is. A broker specialising in adverse credit should be able to guide you through it. Good luck!

boromanc89

Will it drop off though? The CRAs list the account as an active account. I haven't had access to it since June 2014 when I switched it to Santander. But as it was overdrawn, the account seemingly never closed but I also couldn't actually use it (I couldn't even transfer into the account when I paid it off last month, I had to transfer to a Halifax central account which they would then deposit the money for me).

I don't know if it is listed as one single default or if I am listed as defaulting every month - every month there is a big red cross next to the account??? In which case it would be 6 years from now? I've tried to find the answer to this but can't/

[Deleted User]

6 years from the date the default was applied.

As has already been advised to you.

boromanc89

Some people are so rude in this forum.

[Deleted User]

And some people don’t listen or take heed of the advise given to them.

Nebulous2

boromanc89 wrote: »

Will it drop off though? The CRAs list the account as an active account. I haven't had access to it since June 2014 when I switched it to Santander. But as it was overdrawn, the account seemingly never closed but I also couldn't actually use it (I couldn't even transfer into the account when I paid it off last month, I had to transfer to a Halifax central account which they would then deposit the money for me).

I don't know if it is listed as one single default or if I am listed as defaulting every month - every month there is a big red cross next to the account??? In which case it would be 6 years from now? I've tried to find the answer to this but can't/

I’ve never had a default, so I’m flying in the dark here - but it isn’t clear to me that it has defaulted. If it has, somewhere on your credit report will be a default date. That is a one-off event, it can’t default every month. It will drop off 6 years after that date.

If it hasn’t defaulted that could be more problematic, as the missed / late payments will show on your account for 6 years from now. At the very least you should close it when it should be marked as settled.

You really to consult a broker, once you’ve limited the damage as much as you can.

Jumblebumble

xlnc99 wrote: »

There is no point in doing anything about this now. It this was in 2014/2015 then it will drop of your credit file automatically in the next year or so. Id leave it. The amount of time you spend with the FOS and complaints procedure it will probably take a 6 months - 1 year to get a final answer from them.

By that time it should have been removed from your file.

I disagree
My understanding is that when you make a complaint to the ombudsman two new things will happen
The institution will ask someone senior to review so they are not paying the £500 fee ( or what ever it is) which helps concentrate the mind
and the ombudsman will give the institution an indicative ruling

Both scenarios will happen very soon after the complaint