Late payment banking error

rgannon45

Several years ago, I had a credit card account with Halifax that I considered closed. However whilst applying for a perfectly affordable mortgage I recently discovered that Halifax reported a late payment on this account to my credit file. This was surprising as I had not seen any notice regarding this late payment at the time, and I believed the account had been closed.

The payment they were attempting to take was for £1.77p and when I raised a complaint they sent me a statement to confirm that this was the case.

My complaint was asking them if they could investigate to see if this was a mistake as there's always money in the account and an overdraft facility.

The Bank responded by refusing to investigate citing elapsed time as a barrier and saying I should have noticed.

I also raised the complaint with the Ombudsman sending them statements from my business account to prove that money was deposited to my current account. I also noted that the payment was attempted to be taken on a Sunday (according to the statement).

They also refused to investigate citing elapsed time.

I'm at a loss on how to proceed and rectify this situation, which has unjustly affected my credit score and Natwest declining a mortgage based on this.

CliveOfIndia

rgannon45 said:

The payment they were attempting to take was for £1.77p

 as there's always money in the account and an overdraft facility.

I also noted that the payment was attempted to be taken on a Sunday (according to the statement).

So you had a Direct Debit in place to take the full statement balance?  And the DD was active (it hadn't been deactivated due to a period of non-use)?  And the money was in the account to cover the DD?  If the answer to all 3 of those is "yes", then you need to ask Halifax why they didn't take the DD.  That aside, did you not notice on the next statement that the previous payment had not been taken?

rgannon45 said:

I'm at a loss on how to proceed and rectify this situation, which has unjustly affected my credit score and Natwest declining a mortgage based on this.

From what you've described, this all happened many years ago ?  That being the case, and if a single late-payment marker is the only negative on your account, it's exceedingly unlikely that this, in itself, is the reason for your mortgage being declined.  Check all 3 of your credit files to make sure there are no other negative marks on there.

Oh, and ignore your score, it's nothing more than a marketing gimmick that is not even seen by lenders.

Nasqueron

The time bar laws in this country are 6 years from taking out a product and 3 years from knowing you had a reason for complaint or, could reasonably have known you had reason. As such it's >3 years old and a single missed payment won't be the end of the world for an otherwise well managed file. It will disappear after 6 years anyway

rgannon45

CliveOfIndia said:

rgannon45 said:

The payment they were attempting to take was for £1.77p

 as there's always money in the account and an overdraft facility.

I also noted that the payment was attempted to be taken on a Sunday (according to the statement).

So you had a Direct Debit in place to take the full statement balance?  And the DD was active (it hadn't been deactivated due to a period of non-use)?  And the money was in the account to cover the DD?  If the answer to all 3 of those is "yes", then you need to ask Halifax why they didn't take the DD.  That aside, did you not notice on the next statement that the previous payment had not been taken?

rgannon45 said:

I'm at a loss on how to proceed and rectify this situation, which has unjustly affected my credit score and Natwest declining a mortgage based on this.

From what you've described, this all happened many years ago ?  That being the case, and if a single late-payment marker is the only negative on your account, it's exceedingly unlikely that this, in itself, is the reason for your mortgage being declined.  Check all 3 of your credit files to make sure there are no other negative marks on there.

Oh, and ignore your score, it's nothing more than a marketing gimmick that is not even seen by lenders.

Yes, I provided evidence that the money was in my account. But they won't acknowledge the evidence I provided and the final stance is that they won't investigate. It's pretty conclusive that it was a bank error and in my letter, I asked them the AARUD reason codes as to why they can't take the funds.

I think what's more surprising is that I asked CheckMyFile to help remove it and Halifax refused based on them believing it to be correct.

You would think that there should be consistency between the data retention policies of banks and the duration that credit information is held on a consumer's credit file. If a late payment notation remains on a credit file for six years of an account closing then banks should retain relevant data for at least the same duration to allow for proper dispute resolution and verification of records

rgannon45

Nasqueron said:

The time bar laws in this country are 6 years from taking out a product and 3 years from knowing you had a reason for complaint or, could reasonably have known you had reason. As such it's >3 years old and a single missed payment won't be the end of the world for an otherwise well managed file. It will disappear after 6 years anyway

The problem I have is that I'm stuck with a Helidor mortgage. Since the interest rates hiked up last year, I'm paying 8.8%. The mortgage broker told me NatWest had declined my mortgage due to an adverse account (Halifax).

CliveOfIndia

rgannon45 said:

CliveOfIndia said:

rgannon45 said:

The payment they were attempting to take was for £1.77p

 as there's always money in the account and an overdraft facility.

I also noted that the payment was attempted to be taken on a Sunday (according to the statement).

So you had a Direct Debit in place to take the full statement balance?  And the DD was active (it hadn't been deactivated due to a period of non-use)?  And the money was in the account to cover the DD?  If the answer to all 3 of those is "yes", then you need to ask Halifax why they didn't take the DD.  That aside, did you not notice on the next statement that the previous payment had not been taken?

rgannon45 said:

I'm at a loss on how to proceed and rectify this situation, which has unjustly affected my credit score and Natwest declining a mortgage based on this.

From what you've described, this all happened many years ago ?  That being the case, and if a single late-payment marker is the only negative on your account, it's exceedingly unlikely that this, in itself, is the reason for your mortgage being declined.  Check all 3 of your credit files to make sure there are no other negative marks on there.

Oh, and ignore your score, it's nothing more than a marketing gimmick that is not even seen by lenders.

Yes, I provided evidence that the money was in my account.

Having the money in the account is fine - but was there a Direct Debit in place to pay the Credit Card from that account, and was the DD still active?  They will automatically deactivate if they're not used for a period, I think it used to be 13 months but has been increased to 24 months post-Covid.

rgannon45

CliveOfIndia said:

rgannon45 said:

CliveOfIndia said:

rgannon45 said:

The payment they were attempting to take was for £1.77p

 as there's always money in the account and an overdraft facility.

I also noted that the payment was attempted to be taken on a Sunday (according to the statement).

So you had a Direct Debit in place to take the full statement balance?  And the DD was active (it hadn't been deactivated due to a period of non-use)?  And the money was in the account to cover the DD?  If the answer to all 3 of those is "yes", then you need to ask Halifax why they didn't take the DD.  That aside, did you not notice on the next statement that the previous payment had not been taken?

rgannon45 said:

I'm at a loss on how to proceed and rectify this situation, which has unjustly affected my credit score and Natwest declining a mortgage based on this.

From what you've described, this all happened many years ago ?  That being the case, and if a single late-payment marker is the only negative on your account, it's exceedingly unlikely that this, in itself, is the reason for your mortgage being declined.  Check all 3 of your credit files to make sure there are no other negative marks on there.

Oh, and ignore your score, it's nothing more than a marketing gimmick that is not even seen by lenders.

Yes, I provided evidence that the money was in my account.

Having the money in the account is fine - but was there a Direct Debit in place to pay the Credit Card from that account, and was the DD still active?  They will automatically deactivate if they're not used for a period, I think it used to be 13 months but has been increased to 24 months post-Covid.

Yes, in May 2015, they took the regular amount which was £25 in June and July they tried to take £1.77. That's all I owed on the card and was the minimum amount.

This must have been the reason why they couldn't take it, probably an irregular amount and the fact they attempted to take it on a Sunday according to the statement they sent me recently.

I think they understand they have made a mistake due to the evidence, but are using the elapsed time as a barrier to not investigate. I've not asked for redress, just to remove the late payment they wrongly submitted to Equifax.

I think what is more worrying is the Obundsman's dedication to consumer rights.

CliveOfIndia

This all sounds very odd, I must admit.  There's no reason that an "odd amount" would prevent a DD from being honoured.  Likewise, being a Sunday wouldn't normally be an issue (although in my experience a DD is normally taken on the previous working day if the scheduled day is a non-working day).

All that aside, I'm somewhat surprised about the mortgage.  A single late payment in an otherwise clean file, especially if it occurred several years ago, would usually have a negligible - probably zero - effect on any credit application.  It may be worth shopping around to see what other mortgage providers can offer you?  It's pretty easy to shop around online yourself these days, there's no real need to go via a broker unless you've got a tarnished credit history (your isolated, old, late payment marker wouldn't usually fall into that category).

Nasqueron

rgannon45 said:

CliveOfIndia said:

rgannon45 said:

The payment they were attempting to take was for £1.77p

 as there's always money in the account and an overdraft facility.

I also noted that the payment was attempted to be taken on a Sunday (according to the statement).

So you had a Direct Debit in place to take the full statement balance?  And the DD was active (it hadn't been deactivated due to a period of non-use)?  And the money was in the account to cover the DD?  If the answer to all 3 of those is "yes", then you need to ask Halifax why they didn't take the DD.  That aside, did you not notice on the next statement that the previous payment had not been taken?

rgannon45 said:

I'm at a loss on how to proceed and rectify this situation, which has unjustly affected my credit score and Natwest declining a mortgage based on this.

From what you've described, this all happened many years ago ?  That being the case, and if a single late-payment marker is the only negative on your account, it's exceedingly unlikely that this, in itself, is the reason for your mortgage being declined.  Check all 3 of your credit files to make sure there are no other negative marks on there.

Oh, and ignore your score, it's nothing more than a marketing gimmick that is not even seen by lenders.

Yes, I provided evidence that the money was in my account. But they won't acknowledge the evidence I provided and the final stance is that they won't investigate. It's pretty conclusive that it was a bank error and in my letter, I asked them the AARUD reason codes as to why they can't take the funds.

I think what's more surprising is that I asked CheckMyFile to help remove it and Halifax refused based on them believing it to be correct.

You would think that there should be consistency between the data retention policies of banks and the duration that credit information is held on a consumer's credit file. If a late payment notation remains on a credit file for six years of an account closing then banks should retain relevant data for at least the same duration to allow for proper dispute resolution and verification of records

The guidance in the UK is to keep the data for 6 years though they can keep it as long as they deem it useful. Your credit record has just the last 6 years (5 Scotland I believe), anything older will disappear. If you closed in 2015 for example, they may have purged the account in 2021, they may have kept it from your other post

The FOS cannot overrule a correctly applied time bar as it's the law, only a lender can agree

It's like if you owed money to a business, after 6 years they cannot chase you any more - again by law - I imagine you'd be miffed if the lender ignored the law and came after you for the debt

rgannon45

Nasqueron said:

rgannon45 said:

CliveOfIndia said:

rgannon45 said:

The payment they were attempting to take was for £1.77p

 as there's always money in the account and an overdraft facility.

I also noted that the payment was attempted to be taken on a Sunday (according to the statement).

So you had a Direct Debit in place to take the full statement balance?  And the DD was active (it hadn't been deactivated due to a period of non-use)?  And the money was in the account to cover the DD?  If the answer to all 3 of those is "yes", then you need to ask Halifax why they didn't take the DD.  That aside, did you not notice on the next statement that the previous payment had not been taken?

rgannon45 said:

I'm at a loss on how to proceed and rectify this situation, which has unjustly affected my credit score and Natwest declining a mortgage based on this.

From what you've described, this all happened many years ago ?  That being the case, and if a single late-payment marker is the only negative on your account, it's exceedingly unlikely that this, in itself, is the reason for your mortgage being declined.  Check all 3 of your credit files to make sure there are no other negative marks on there.

Oh, and ignore your score, it's nothing more than a marketing gimmick that is not even seen by lenders.

Yes, I provided evidence that the money was in my account. But they won't acknowledge the evidence I provided and the final stance is that they won't investigate. It's pretty conclusive that it was a bank error and in my letter, I asked them the AARUD reason codes as to why they can't take the funds.

I think what's more surprising is that I asked CheckMyFile to help remove it and Halifax refused based on them believing it to be correct.

You would think that there should be consistency between the data retention policies of banks and the duration that credit information is held on a consumer's credit file. If a late payment notation remains on a credit file for six years of an account closing then banks should retain relevant data for at least the same duration to allow for proper dispute resolution and verification of records

The guidance in the UK is to keep the data for 6 years though they can keep it as long as they deem it useful. Your credit record has just the last 6 years (5 Scotland I believe), anything older will disappear. If you closed in 2015 for example, they may have purged the account in 2021, they may have kept it from your other post

The FOS cannot overrule a correctly applied time bar as it's the law, only a lender can agree

It's like if you owed money to a business, after 6 years they cannot chase you any more - again by law - I imagine you'd be miffed if the lender ignored the law and came after you for the debt

Appreciate the advice.

rgannon45

Nasqueron said:

rgannon45 said:

CliveOfIndia said:

rgannon45 said:

The payment they were attempting to take was for £1.77p

 as there's always money in the account and an overdraft facility.

I also noted that the payment was attempted to be taken on a Sunday (according to the statement).

So you had a Direct Debit in place to take the full statement balance?  And the DD was active (it hadn't been deactivated due to a period of non-use)?  And the money was in the account to cover the DD?  If the answer to all 3 of those is "yes", then you need to ask Halifax why they didn't take the DD.  That aside, did you not notice on the next statement that the previous payment had not been taken?

rgannon45 said:

I'm at a loss on how to proceed and rectify this situation, which has unjustly affected my credit score and Natwest declining a mortgage based on this.

From what you've described, this all happened many years ago ?  That being the case, and if a single late-payment marker is the only negative on your account, it's exceedingly unlikely that this, in itself, is the reason for your mortgage being declined.  Check all 3 of your credit files to make sure there are no other negative marks on there.

Oh, and ignore your score, it's nothing more than a marketing gimmick that is not even seen by lenders.

Yes, I provided evidence that the money was in my account. But they won't acknowledge the evidence I provided and the final stance is that they won't investigate. It's pretty conclusive that it was a bank error and in my letter, I asked them the AARUD reason codes as to why they can't take the funds.

I think what's more surprising is that I asked CheckMyFile to help remove it and Halifax refused based on them believing it to be correct.

You would think that there should be consistency between the data retention policies of banks and the duration that credit information is held on a consumer's credit file. If a late payment notation remains on a credit file for six years of an account closing then banks should retain relevant data for at least the same duration to allow for proper dispute resolution and verification of records

The guidance in the UK is to keep the data for 6 years though they can keep it as long as they deem it useful. Your credit record has just the last 6 years (5 Scotland I believe), anything older will disappear. If you closed in 2015 for example, they may have purged the account in 2021, they may have kept it from your other post

The FOS cannot overrule a correctly applied time bar as it's the law, only a lender can agree

It's like if you owed money to a business, after 6 years they cannot chase you any more - again by law - I imagine you'd be miffed if the lender ignored the law and came after you for the debt

Thanks for the advice. Appreciated.