Mortgage application rejected due to default TSB current account

kolapig

Dear all,

I have an joint mortgage account with my partner and we are trying to remortgage from our current lender to a new one. However, the mortgage application was rejected due to my unexpected low credit score in Experian.  The reason is due to a default TSB current account under my name which I have not touched for a long time and has no any money in it. From 6 months ago, the account started to have a series of monthly 3 pounds charges. TSB explained to me that it was because I do not have enough fund for a standing order in this account (I doubt that). And after three failure attempts, the account will be charge 3 pounds. Now, they have closed my the current account and marked it as default with a default value of 18 pounds. And this slashed my credit score from 900+ (excellent) to less than 600 (low). 

Any suggestions on how I can deal with this please ?

Thanks,
David

aoleks

you don't need to undergo any checks to switch product with your current lender, so even though they might not give you the best rate available, it will still be the best option you have and much better than any variable rate out there. learn your lesson, repair your credit score and do NOT open more than one current account unless you plan on actively using, managing and monitoring it.

if you don't plan on doing those things, they're not for you and you don't NEED a second current account.

MaryNB

Your mortgage application wasn't declined due to your low Experian score. Lenders don't use the Experian/Equifax/TransUnion score, they don't even see it.

The lender  saw the default on your file and as a result you've failed their internal scoring.

A very recent default will cause problems with a lot of lenders. Get a broker to see if they can help you find a lender who will accept it. 
Have you tried remortgaging with your current lender? A product switch won't be subject to a full application.

kolapig

aoleks said:

you don't need to undergo any checks to switch product with your current lender, so even though they might not give you the best rate available, it will still be the best option you have and much better than any variable rate out there. learn your lesson, repair your credit score and do NOT open more than one current account unless you plan on actively using, managing and monitoring it.

if you don't plan on doing those things, they're not for you and you don't NEED a second current account.

Thanks a lot for your replies MaryNB and aolks.

TSB claims
1. they sent me post regarding it but I did not.
2. they charged me due to standing order failures, but I think I do not have standing orders. I believe it is their system problem (TSB has been having problems with their systems) as my partner also had a TSB account and was also charged 3 pounds a month for sometime. My partner challenged them successfully. I think my situation is similar. However, as they have closed my account, I do not have evidence now. 

The credit report certainly does not reflect my credit due to this 18 pounds default.
I am wondering how I should proceed to challenge them and get the default account reverted. Would you recommend doing that ? and is it possible to revert the credit history if evidences are provided ?

Thank you very much. 
 

Thrugelmir

Mortgage application rejected due to default TSB current account

Lenders will never give the actual reason for the decline. Best approach is to take it on the chin and apply elsewhere.  Not over analyse the reasons why.  Approach a broker rather than going direct to avoid making too many applications. 

london21

Might be easier staying with the current lender in your case.

kolapig

thanks for all your replies. I agree that staying with the current lender is probably the best solution for now. But the reason I am looking to get the default account reverted is due to the fact that a default information would stay in my credit report for 6 years. This means that it would impact my ability to apply for loans in the next few years, which would impact me a lot. 

Some of you probably would not agree with me. For me, I admitted my own mistakes for not monitoring this account. But I do think TSB misused/abused their power, marking an individual default for 18 pounds fine lightly on a current account not in use without even speaking to them is ridiculous... The financial impact to the individuals is huge. And this action distorted the individual's real credit history and affordability.   

I will to get transaction and standing order charge history(reason for the deficit) from TSB. If necessary, I am thinking escalating this to FOS. Do you think this would work ?

[Deleted User]

kolapig said:

thanks for all your replies. I agree that staying with the current lender is probably the best solution for now. But the reason I am looking to get the default account reverted is due to the fact that a default information would stay in my credit report for 6 years. This means that it would impact my ability to apply for loans in the next few years, which would impact me a lot. 

Some of you probably would not agree with me. For me, I admitted my own mistakes for not monitoring this account. But I do think TSB misused/abused their power, marking an individual default for 18 pounds fine lightly on a current account not in use without even speaking to them is ridiculous... The financial impact to the individuals is huge. And this action distorted the individual's real credit history and affordability.   

I will to get transaction and standing order charge history(reason for the deficit) from TSB. If necessary, I am thinking escalating this to FOS. Do you think this would work ?

They are a large, financial, organisation, you are making this situation into a small and personal one.
Just draw a line under this and get on with your life, time is too precious in the grand scheme of things.

[Deleted User]

Just because the account is closed doesnt mean all the records have gone.   Register a complaint if needed and ask for proof of what payments were rejected. If they provide it then its your fault and move on, if they cant then maybe they will reverse all the damage 

kolapig

Thanks all again for your replies so far. I have just checked my credit report. 
I am now pretty sure it is TSB's system issue (just like my partner's case, who challenged successfully).

I have not used this account for years and suddenly from 6 months ago I started to get charged 3 pounds monthly due to a standing order failure.. If I had have a standing order, I should have been charged from much earlier... 

I will challenge TSB on this matter and if it does not get resolved, I certainly will escalate this to FOS.
Now I understand how important IT system is for the financial industry. 

kolapig

just for friends who may be using this nice forum. 

here is the statement of my husband which proves that there TSB indeed has a system problem earlier this year.
They charged my partner in Feb 2021 and later reverted the charge in March after the challenge. 

I probably would not recommend anyone using TSB going forward, given their history including the IT system turmoil in 2018.
Previously, I think all banks are the same, but now I released they can be very different.
Google this article "Almost 90% of TSB complaints upheld by ombudsman"  for a reference!