How do I know account has defaulted?

whereswallyscat

Hi everyone, new here today on my road to being debt free. 

My first burning question is - when do I know an account has defaulted, and it isn’t just a debt collector working on behalf of the company? Who will contact me when the account has defaulted - the company, or a debt collector? How do I know that debt collection company that I will arrange repayments to is not a scammer and that the account has actually defaulted and will drop off my file in 6 years (not 6 years AFTER the debt has been paid). 

Sorry for the many (stupid) questions. I’m sure I will have many more!! 

Grumpelstiltskin

You should receive a letter from the original creditor telling you the debt has defaulted and it should appear on your credit report as defaulted.

Then you should be informed if the debt has been sold or assigned to another company.

whereswallyscat

Thank you Grump! 

So I should ignore any/all contact from debt collectors, wait for letter from original creditor to say it has defaulted, then wait for other company it has been assigned/sold to to contact me and then arrange DMP payments. I am going down the self managed route so want to make sure I don’t miss anything, or do anything wrong 

Grumpelstiltskin

Yes and keep checking your credit report to see if it is marked as defaulted on there.

whereswallyscat

Thanks. 

Is BW Legal a debt collection agency? I had a loan with 118118, it got passed to PRAC Financial who BW Legal now collect payments from me each month on behalf of. I can’t see a default anywhere on my credit file though, and can’t remember the details as it got passed to them a few years ago. 

PRAC financial appear to be a buyer of debts, so I assume BW Legal are just acting on their behalf and this one did default and the monthly repayments I am making are OK. 

Grumpelstiltskin

How old is that debt? could it have been 6 years or more when it was defaulted.

whereswallyscat

Just checking further. Debt is from 25/10/2021

I can see on clear score now that I have 1 account in default, it just won’t show me what the account is so I have emailed them (when I click for more info it just takes me to a self help page, no details of the actual account). I suspect it is this one that I make payments to BW Legal for! 

Grumpelstiltskin

Have you checked  all 3?

Check your credit rating & report for free – MSE

whereswallyscat

Thank you - checking now. I find Transunion the easiest one to navigate and use but can’t find anything which says I have a defaulted account. And a very wishy washy entry on ClearScore that won’t let me view what the actual defaulted account is! 

Do you know which section on Transunion I would find if I had any defaulted accounts recorded? 

ayupmeduck

All defaults will show under the account it's for under your list of accounts on your report. If none show you don't have any

For example:

CreditKarma -> credit -> full credit report

Some CRA show defaulted accounts under 'closed accounts'

sourcrates

A default notice will be sent under sec 87(a) consumer credit act asking for full payment of the arrears within 14 days.

Defaults show on the status section of your credit accounts entry on your file.

They stay there for 6 years and are then automatically removed, so if any of your debts defaulted over 6 years ago, nothing will show on your credit report.