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Mandy1690

I received a loan from a credit union in June 2011. I made payments regularly until I got into difficulty. I have not contributed any payments to this since October 2011. They transferred my shares to reduce the amount in January 2012 and again in October 2012. This left a balance of £647 which is still reflecting negatively on my equifax credit report. I have been trying to increase my score now that my circumstances have changed and was considering making an attempt to pay this but also hear on forums that after 6 years any defaulted accounts regardless of outstanding balance is cleared or not will be removed from credit reports. Is this correct? If so this has been on my report for almost 9 years which I don’t understand. I have spoken with the credit union and they are stating that although they are no longer pursuing this debt which is this amount will continue to remain on my report until the balance has cleared. Should I pay it off or am in within my rights to dispute this? I called them today and they said they could contact equifax and say the account has now been settled but then open another loan with remaining balance and start paying that which will improve my score. this default only appears on equifax and not experian or transunion  im confuses. Please help me !

[Deleted User]

When did it default?

sourcrates

Mandy1690 said:

I received a loan from a credit union in June 2011. I made payments regularly until I got into difficulty.  I also hear on forums that after 6 years any defaulted accounts regardless of outstanding balance is cleared or will be removed from credit reports. Is this correct?

No, its not correct.
Your outstanding balance will show on your credit file for 6 years from date of default, paid or unpaid.
If you have not made payment or acknowledged the account in writing, for any period of 6 years or more, since it defaulted, then the account will be statute barred.

What that means is the creditor is unable to take action through the courts to enforce their rights, they appear to have accepted that is the case, but they can still ask you to pay the debt, they just can`t make you do so.

I suspect the account never defaulted, which is why it still shows after 9 years.

Mandy1690

It defaulted in October 2011 

Mandy1690

I haven’t paid it or made contact since 2011. I check my report most weeks and the credit union still appear to update it each month. After speaking them today they said unless the balance is paid in full it will continue to reflect negatively on my report 😭

jimbo26

Mandy1690 said:

It defaulted in October 2011 

Is that what it says on your credit file, or is this the date you think it defaulted because that is when you stopped paying. It is an important difference.

PaulW922

Did you positively consent to the transfer of your share to a payment against the debt? Or did they just 'do it'?

Mandy1690

Morning and thank you for your response. I am meant to be going into meet with them today to make arrangements so unclear on what I should do. 

I have just checked my credit report and where it says status it says: in arrears. 

It says the date last delinquent is 03/20 but where it says default date it has been left blank.i can also confirm that at no time whatsoever did they ask if they could transfer my shares towards the loan which they did twice. I hope this helps 

sourcrates

In that case, the account did not default, and will be reported indefinitely.
Most credit unions lend money direct to borrowers where the interest rate charged does not exceed the statutory cap. 
This type of lending is exempt from regulation, and is not a regulated consumer credit activity. 

This means your loan is most likely, not governed by the consumer credit act, so the guidelines on defaults and arrears do not apply to you.