Default and Sold Debt While on DMP

Scremdelascrem

Hi, hopefully this is the right place for this.

To give some context before I get onto my questions - I've been on a DMP via step change since May 2022 and have made the agreed payments on time every month. The DMP covers 4 credit cards, all of which have been receiving at least one percent of the balance each month throughout the DMP. Throughout the first 2 years none of my credit card providers have noted a default or missed payment.

However, at the start of this year I paid step change as normal but there was an issue with their payment company and the payments didn't make it to the credit card companies for 2 successive months. On the 3rd month, all received 3 months worth of payments and the next month everything went back to normal. I wasn't contacted about this by any of the companies and only noticed when checking my credit report later in the year. 

3/4 of the credit card companies noted this as a missed payment. I contacted them and explained the situation and the missed payments were removed my credit file. The 4th, however, was Virgin Money. Upon the missed payment they sold the debt to cap quest who have declared the account in default and repeated that every month since despite payments continuing to be made. 

I raised a complaint to cap quest about this and they directed me to complain to Virgin. Virgin have denied my complaint and declared they acted properly.

My frustration here is that I've got 2 years into tackling my debt burden before a default has been declared on my file. This means instead of any default being off my account 6 years from the start of the DMP it is now going to be 8 years and possibly longer if Cap Quest continue to declare defaults monthly against my file.

And to get round to my questions:
1. Should cap quest be recording a default every month? My understanding is that an account should be declared in default as a single event, especially if the agreed payments have continued after a missed payment.

2. Do I have any recourse to escalate my appeal against the default in the first place? My feeling is that this should be no more than a missed payment plus the mitigating circumstances that I made my payment but the payment to Virgin was messed up by an appointed middleman. If so who do I escalate/speak to about this?

Many thanks 

Grumpelstiltskin

Your problem is you started your DMP before your debts had defaulted.

Once a debt has defaulted it disappears from your credit file 6 years from the default date even if it has not been fully repaid.

By paying before a default date you will receive Arrangement to Pay markers, they do not disappear until 6 years after your final payment, so if it takes you 5 years to repay it takes 11 years ( assuming England or Wales ) to disappear.

ManyWays

1. Should cap quest be recording a default every month? 
Yes, this is how defaults are always recorded, but only 1 default is counted for credit scoring and the record will drop off 6 years after the first default. 

RAS

Under current arrangements, your credit record is going to be damaged for 8-9 years, even if you paid off all your debts tomorrow. Because you have AP markers rather than defaults on three of your accounts.

You need to work out how soon you might pay off those debts and come back for a chat about whether you'd be better off getting defaults now.

fatbelly

It sounds like you are not clearly seeing a default date on whatever tool you are using.

Try a statutory report like

https://www.transunionstatreport.co.uk/CreditReport/AboutYou