Bounced standing order: missed payment/arrears

7Phil

January 2018 I had a standing order from my savings account that bounced. Was an order of payments issue that at the time I wasn't worried about because I though worst case scenario I would get a missed payment fee and deal with it. The standing order bounced. Next day I sent the payment to the recipient via BACS. They didn't even register anything was missed.
Then after a couple of months I saw a "missed payment / arrears" showing on my credit file on my savings account. I thought that was strange because this is my regular savings account that my salary is paid in to. My bank holds my money. I don't owe them anything. I don't owe them a monthly payment.
I called them (HSBC group) and was explained that the missed standing order was the "missed payment". Although it looks like I missed paying money to the bank it was actually that I missed an outgoing payment. OK. Fair call & rookie error. I did not understand and learnt this lesson about standing orders now.

Fast forward two years and this is still sitting on my credit file with multiple agencies as a smear: "ONE ADVERSE ACCOUNT".
Drill in to that warning and find my single missed payment in Jan 2018 from my savings account showing up as the full month being "in arrears". On a savings account.
Come on. I missed the scheduled standing order and paid the money manually the next day.

This is beyond frustrating. How long does it take for this to drop off? Full six years?

[Deleted User]

Yes, 6 years   But its effect diminishes with time.

Just try to make payments on time going forward.  Many people take the view of 'come on, it's only a day late' when paying bills but it never ends well.

xlnc99

this doesnt make sense

How can HSBC mark you as a late payment for missing a standing order? I think you are confused

The only way HSBC have marked you late is if they charged you a fee for the missed payment and you were in arrears for the HSBC account . They cannot mark you down as a late payment for not paying out a standing order. Most ridiciclous thing i have ever heard

7Phil

Deleted_User said:

Just try to make payments on time going forward.  Many people take the view of 'come on, it's only a day late' when paying bills but it never ends well.

Yes, I certainly have learnt my lesson. My bank (specifically First Direct) send us a text alert and give us until around 3-4pm to make sure the funds are in the account on the date of the SO.
In my case I was expecting that to happen but was not sure what time it would arrive in my account. At the time I just expected I would cop a small fee and the SO would be processed on the following day (or I send the amount to the recipient via another means). Part of me being naive is that I spent most of my life in Australia and that's exactly what happens with these types of regular payments there.

It most certainly will not happen again to me and I understand HSBC group is one of the few banks that report this on your credit file. Or if things are changed since 2018 then only one of the banks that used to.

7Phil

xlnc99 said:

How can HSBC mark you as a late payment for missing a standing order? I think you are confused

No, not confused. That's exactly what happened and I discussed it with my bank two years ago.

I totally agree with you though. It is outrageous. What is more outrageous is me signing up to checkmyfile two years later (this week) and finding this is still there as an adverse remark! My eyes nearly fell out of my head. Two years ago and it says this!

I wish there were some magic words or a nice message I could send to remove it but then I also understand a credit file correction also looks dim on your file too, so not even sure it's worth it anyway.
Maddening.

Thrugelmir

Banks don't pay standing orders from savings accounts. Would be a current account. If the standing order wasn't paid due to insufficient funds then yes the bank may have stopped the payment. No reason for the payment to be made the next day. The bank doesn't offer you a private banking service. 

xlnc99

7Phil said:

xlnc99 said:

How can HSBC mark you as a late payment for missing a standing order? I think you are confused

No, not confused. That's exactly what happened and I discussed it with my bank two years ago.

I totally agree with you though. It is outrageous. What is more outrageous is me signing up to checkmyfile two years later (this week) and finding this is still there as an adverse remark! My eyes nearly fell out of my head. Two years ago and it says this!

I wish there were some magic words or a nice message I could send to remove it but then I also understand a credit file correction also looks dim on your file too, so not even sure it's worth it anyway.
Maddening.

There is a way to stop it, you need to make a formal complaint. I have had plenty of missed payments due to direct debits/ standing orders etc. I get charged a fee and that is the end of it. Never had a late marker for this. Infact, just a few months back i was £899 overdrawn (no overdraft facility) i paid it back after 23 days when it was overdrawn and got no late marker.

How long were you in arrears for when the standing order bounced? Did you clear it the same day? Next day? Next week?

You can get this removed, make a formal complaint.

7Phil

xlnc99 said:

How long were you in arrears for when the standing order bounced? Did you clear it the same day? Next day? Next week?

You can get this removed, make a formal complaint.

Yes. That was just a few days into January and I was mega-tight that month right after Christmas/NY holidays. The funds that I was relying on to pay the SO came in late that day (or overnight, can't remember) and when I found the SO bounced I paid the amount via BACS the following day. The recipient didn't actually notice or register the missed payment.
It was a rental agency, and as I was moving house (another reason I was down to the line with money). It was just the final pro-rata rent payment for the final few weeks of my tenancy. It was all just a messy time with money going out and coming in abnormally but ignore my sob-story... It was not a routine month.

When I spoke to FD they explained to me that they do report this on my file I accepted I screwed it up and just dealt with it as a lesson learnt. Never happened again, and will not.

It wasn't until now that I see this, and the way it is worded (according to check my file). Looks like I missed a payment to FD for a credit agreement and was "1 month in arrears". And that just hangs around for 6 years. It's a completely incorrect reflection of my situation.

Yes, this is my "current account". Me saying savings account is just again being naive due to being used to the Australian banking system.

xlnc99

I am at a loss here. So you were not actually in arrears at all? Even when you get a bounced standing order, they do not charge you a late fee there and then. They will charge you a late fee that deducts the following month. Your account was never in arrears at any point. Even if your standing order did not come in, its irrelevant. you did not go overdrawn and all FD was block the SO. Any fees would have been charged later on. You were never at all at any point in arrears with FD.

This is the most bizzare late payment i have ever seen. Infact, i have never heard of any such thing. They are not allowed to do this, so many wrongs and holes from FD. So much so that i believe you are missing something out of this story because very simply put they cannot give you a late payment marker based on what you said. It is just impossibble.

Make a complaint, email them and basically just explain what has happened and ask them why you have got a late payment marker as you were never in arrears or late with any payment. You dont even have to mention the SO, just email them and tell the that you looked at your file and you have received a late payment marker for so and so month but you dont understand why as you were not in arrears.

7Phil

Thanks, I would be happy to go via the complaints procedure and see what they agree to do. My experience is that good things come to people that complain so I might try it.

I don't believe I have missed anything out. I try to give all the information relevant as possible to get the most accurate advice.
I did have an OD on that account. If FD paid the SO as scheduled then I would have gone well over my agreed OD limit. However, all FD did was reject the SO and credit the amount back to the account. I can't even remember if I was charged a fee for this, it was too long ago. The next day I saw the SO failed (as I was thinking was possible) but by then the funds I was expecting was in my account and I paid the SO amount via BACS.

For what it is worth I have found two OLD discussions with a similar type of issue. Seems HSBC/FD are the only banks that report this:
[in this case it is a DD not SO, but similar issue] https://forums.moneysavingexpert.com/discussion/3811025/hsbc-returned-direct-debit-and-credit-file/p1
[similar] https://forums.moneysavingexpert.com/discussion/4047171/hsbc-overdraft-late-payment-possible-mistake-on-my-credit-history

While I understand that no one here can provide financial advice - will a successful complaint merely only result in a correction on my file and, based on your knowledge, will that correction reflect as poorly against my file anyway?
I was quite OK living with this for a short term but four more years with this message is a lot. I have zero other missed payments, arrears, no CCJ, nothing. Also have a personal loan and a CC which are all 100% green.
This is the only adverse remark so I think it is worth fighting for.

xlnc99

they will remove the late payment marker and mark it as paid on time so it would be as if you never missed a payment