Arrangement to Pay

Bobble30

So I agreed on an "arrangement to pay" on a loan I had fallen behind on the repayments for.

I have had no end of issues since this, my credit score has plummeted to the worst its ever been and I cannot get finance for a new car which I desperately need.
The issue being they arrangement to pay payments are showing as missed payments on my credit score.
How can I rectify this?


I feel I was misled on this arrangement as they didn't explain how it would affect my credit score and the implications of having this "arrangement" set up. When I agreed to it I wasn't aware on what exactly it was I was agreeing to, they gave me three options and it sounded like the best. The other two were basically don't pay and you'll end up worse.

Any help or advice greatly appreciated.

PartyOfFive

Use the money you were planning on paying the car finance with to catch up with the arrears on your loan.

Once up to date and you have a few months of normal payments, things potentially might get better Car finance wise.

Missed payments are bad, but not as bad as a default. Ignore the actual score - it’s meaningless. Read the sticky on the Credit Score board for more information.

sourcrates

Unfortunately anything other than full contractual repayment on any credit agreement will result in negative information being recorded on your credit file.
How do you intend to service a car loan when you can`t afford your current borrowing ?

Credit score isn`t a thing, credit history is, how long are your payment issues likely to last ?

If its a short term thing, then as said above, once normal payments are resumed, your credit history will improve, lenders typically look at your last 6 months credit history when making lending decisions, depending on the financial product you apply for.

If you are going to struggle longer term, then it makes sense to default on the loan, and save those payments up towards a car.

Once you have a sufficient figure saved up, you can buy your car, something cheap yet reliable, and also make arrangements to repay the loan via debt management.

Those are essentially your choices.

Bobble30

Thank you the replies, its really helpful to know.
I am currently paying for a car on PCP and need to trade it in for another car as want to downsize the car but they won't accept me for finance on a smaller car paying less money than I am paying now.

I can actually afford the payments now and am in a much better position financially than I was 6 months ago when I agreed to the arrangement to pay.
It's more the fact I feel I was misled, I could afford the repayments after I missed 2 repayments but they wouldn't allow me to restart paying the full amount of the loan I was paying to begin with. 
I will get in touch with the lender to clear the amount I am owed and wait for my score to increase hopefully and missed payments to stop appearing on my history.

Thank you again.

MorningcoffeeIV

Bobble30 said:

I will get in touch with the lender to clear the amount I am owed and wait for my score to increase hopefully and missed payments to stop appearing on my history.

The missed payments will be there for 6 years and your score means less than nothing.

You need a better plan and to learn from the advice you've been given above.

Bobble30

MorningcoffeeIV said:

Bobble30 said:

I will get in touch with the lender to clear the amount I am owed and wait for my score to increase hopefully and missed payments to stop appearing on my history.

The missed payments will be there for 6 years and your score means less than nothing.

You need a better plan and to learn from the advice you've been given above.

What I meant by wait for them to stop appearing, was once I'd paid back what I owed, future missed payments not to appear...
I know how long the missed payments will show there for and I am aware I can't change that. 

I have taken what's been said on board.

fatbelly

AP markers do seem to cause confusion. I found a post where a poster had asked Experian to spell out clearly how long an AP marker would stay for and this is the response:

If an arrangement flag is recorded on your account, this is usually retained until the account has been removed.

We keep defaulted accounts on your report for six years from the date of default. This is true whether or not the debt has been fully repaid.

We keep settled accounts on your credit report for six years from the date of settlement.

So if you settle your account today the entry with its AP marker will be removed in 2029

Bobble30

fatbelly said:

AP markers do seem to cause confusion. I found a post where a poster had asked Experian to spell out clearly how long an AP marker would stay for and this is the response:

If an arrangement flag is recorded on your account, this is usually retained until the account has been removed.

We keep defaulted accounts on your report for six years from the date of default. This is true whether or not the debt has been fully repaid.

We keep settled accounts on your credit report for six years from the date of settlement.

So if you settle your account today the entry with its AP marker will be removed in 2029

Thank you so much, this is exactly the kind of answer I was looking for