How important is it that accounts are classed as *closed* on credit report?

VoyageVoyage

Hello.

I am nearly 5 years into a 6 year IVA (due to home equity) and have recently started a preemptive credit file clean up. I understand that having each debt recorded as a default and the default date on or before the IVA date is crucial, but what nobody seems to mention is whether or not the debt should be classed as *closed*.

Some of my debts will say *closed* with one or two credit reference agencies, but not the other. It's all rather random. Does the debt being *closed* really matter? Will all the debts completely disappear at the 6 year point regardless of being classed as closed or not?

Thank you

lordcockerspaniel

Good idea to do it now. I’m six months into a battle with VWFS to correct my reports. They all read different. As long as the default was applied on the date of the IVA they will disappear. VWFS refuse to apply the default, and are still reporting late payments on one reference agency. It’s with the ombudsman currently. It takes time. Mostly I’d make sure that the default has been applied correctly. Debtcamel has excellent letters to help you.

sourcrates

They will all disappear on the 6th anniversary of the default date regardless of whether they say closed open or otherwise.

VoyageVoyage

lordcockerspaniel said:

Good idea to do it now. I’m six months into a battle with VWFS to correct my reports. They all read different. As long as the default was applied on the date of the IVA they will disappear. VWFS refuse to apply the default, and are still reporting late payments on one reference agency. It’s with the ombudsman currently. It takes time. Mostly I’d make sure that the default has been applied correctly. Debtcamel has excellent letters to help you.

Yes, I've spent the last months sending emails, letters and phone calls to lenders and having them change the dates. some were more than a year after my IVA started! Paypal and Monzo were by far the worst, I had to take them to the Ombudsman. Now they all say default and have a date of my IVA or earlier. It was just the 'closed' or 'active' aspect that puzzled me. Thanks, and good luck.

VoyageVoyage

sourcrates said:

They will all disappear on the 6th anniversary of the default date regardless of whether they say closed open or otherwise.

Thanks, that's reassuring. What, in your opinion, is the purpose of the 'closed' status then? If the account is in default I mean. It seems to differ wildly not only between agencies but also between accounts.

ManyWays

The debts should be marked as satisfied or partially satisfied  after your IVA completes, not before.  If you have a 6 year IVA and they were marked as defaulted at the start of the IVA, as they should have been, then the debt will already have dropped off your record so this bit doesn't matter.

If your IVA had been 5 years, or it was settled early, then it is a good idea to make sure the debts are then marked as satisfied for two reasons, first it this helps to prevent silly situations where your debt that has been cleared is accidentally sold to a debt collector and second some lenders may be more prepared to lend to you as they can see the debts have been cleared. 

sourcrates

VoyageVoyage said:

sourcrates said:

They will all disappear on the 6th anniversary of the default date regardless of whether they say closed open or otherwise.

Thanks, that's reassuring. What, in your opinion, is the purpose of the 'closed' status then? If the account is in default I mean. It seems to differ wildly not only between agencies but also between accounts.

Creditors discretion really, the "default" status takes priority, the "closed"/"settled" or however they mark it, is just for information purposes to any potential new lender I suppose.