TransUnion and an incorrect Default notice

colinjsavage

First post so hello.

After a while out of work I had pretty well maxed out my credit card so when I went back to work I prioritised clearing it asap. Once I'd got it down to about 75% of the credit limit, I decided to take on a loan to clear it, as that would involve paying much less interest and ensure I had the cashflow to clear a couple of other debts I'd incurred. Apart from a few missed payments in 2019, all of which had been agreed with the lenders, my credit has always been good and getting loans at good rates hasn't ever been a problem previously. Yet I struggled this time, to my surprise, but got one at just under 15% APR (which ncluded a £295 fee) and was by far the cheapest. This was still cheaper than the 26% the credit card was costing me though.

On checking my credit report via MoneySupermarket, which uses CreditKarma, which in turn uses data from TransUnion, I was shocked to see a default on my report yet all my accounts, both open and closed, were clear so I couldn't see where the default was.

I got a hard-copy of my report fom TransUnion and there was a default on a closed car finance account. This was puzzling as it was 100% satisfactory at the time, with no missed or late payments, and there was no default when I looked at that account via CreditKarma online. Yet the TransUnion hard-copy report showed the account in default. I rasied a dispute naturally, assuming the lender had incorrectly notified it but they hadn't. Experian and Equifax confirmed the account was not in default and it seems TransUnion had, for no apparent reason, unilaterally and falsely decided the account was in default. I therefore raised a formal complaint as I was really annoyed, and just after I did that they replied re the original dispute notice. They said they'd investigated and removed it but there was no explanation of how it got there, how long it had been there, or any hint of an apology.

I reckon it was this action that caused my elegibility for a decent loan rate to be impacted. Had I got one at headline rate (or close to headline rate - c3.5% APR) the loan would have cost me around £600 less in interest than the one I have. I'm awaiting the outcome of the complaint but as TransUnion have clearly been grossly negligent in their action, do I have a case against them that I can take to the FOS if the outcome of my complaint isn't satisfactory?

sourcrates

Yes, you don`t need to have "a case", you can always take your complaint to the FOS if you remain unhappy with the companies final response.

You might get £50 or so, as a gesture of goodwill for the inconvenience, but not much more.

colinjsavage

Update on this. TransUnion removed the incorrect entry and I'm still awaiting the outcome of my official complaint (which they are due to respond to within the next 2 weeks).

However, I was still getting reports of a default on my TransUnion account and, on checking again, there was also a Default registered against another settled loan account. Again, neither of the other two agencies had this as a defaulted account. I naturally assumed that TU had screwed up again but, on speaking to the lender (Tescobank), they admitted they had sent the wrong information and immediately offered me an apology and £250 compensation, which I accepted. They also expedited the removal of the incorrect information.

With no defaults on my report I was then able to see loan offers at the rates I would have expected with a good credit record. On this basis, I have therefore asked TransUnion for the compensation I calculated above, based on the difference in interest between normal headline rates and what I am currently paying on my loan, plus £250 damages. This comes to just over £825. If they fail to offer me this, or something close to it, then I will take my case to the FOS using Tescobank as an example.

ItsComingRome

colinjsavage said:

Update on this. TransUnion removed the incorrect entry and I'm still awaiting the outcome of my official complaint (which they are due to respond to within the next 2 weeks).

However, I was still getting reports of a default on my TransUnion account and, on checking again, there was also a Default registered against another settled loan account. Again, neither of the other two agencies had this as a defaulted account. I naturally assumed that TU had screwed up again but, on speaking to the lender (Tescobank), they admitted they had sent the wrong information and immediately offered me an apology and £250 compensation, which I accepted. They also expedited the removal of the incorrect information.

With no defaults on my report I was then able to see loan offers at the rates I would have expected with a good credit record. On this basis, I have therefore asked TransUnion for the compensation I calculated above, based on the difference in interest between normal headline rates and what I am currently paying on my loan, plus £250 damages. This comes to just over £825. If they fail to offer me this, or something close to it, then I will take my case to the FOS using Tescobank as an example.

I'm not sure why you think TransUnion should compensate you, especially as, as you've seen, lenders do sometimes report incorrect information to CRAs, and occasionally just to one of them.

If the car finance co has sent the wrong information, that's not TransUnion's fault or problem, it's theirs.

The Ombudsman (and very likely whoever's fault this is) isn't very likely to order them to cough up for what interest rate you might have gotten, only for actual provable losses and compo for time spent faffing around.  It's even quite likely, as the CRA was TransUnion, that the lender didn't even bother checking them, many don't.  And many mainstream lenders won't lend with a default on your credit file, so you'd be far more likely to be declined than offered a slightly less favourable interest rate.

[Deleted User]

You can't prove you would have got the interest rate you think you should have got with or without the incorrect entry, Trans Union will not pay you the difference though a token apology fee is probably likely. FOS are not going to make them pay that either.

adamp87

Your complaint would be with the creditor reporting not Transunion. And they’ll probably (if they do) offer you £50 and that’ll be that.

colinjsavage

adamp87 said:

Your complaint would be with the creditor reporting not Transunion. And they’ll probably (if they do) offer you £50 and that’ll be that.

Not sure what you find hard to understand. The creditor DID NOT report a default. It was incorrectly put on my record by TransUnion themselves, without any adverse report from the creditor. That was a completely negligent action on their part with no justification.

ItsComingRome

colinjsavage said:

adamp87 said:

Your complaint would be with the creditor reporting not Transunion. And they’ll probably (if they do) offer you £50 and that’ll be that.

Not sure what you find hard to understand. The creditor DID NOT report a default. It was incorrectly put on my record by TransUnion themselves, without any adverse report from the creditor. That was a completely negligent action on their part with no justification.

How do you know that given you've had another creditor that fessed up to doing exactly that?

And out of curiosity, what was the interest rate you were offered on the loan?