Trapped by Virgin Money and credit file lies

LivingOnCredit

I'm at my wit's end - someone here must have experience as I can't believe I'm alone in this situation.

Last year, my company went bust leaving me in dire straits. I contacted Virgin Money who took me through a long affordability questionnaire and finished by telling me I couldn't afford the payments (no sh*t!) and there was nothing they could do to help me. With zero in the bank, I ended up missing 2 payments in Sept/Oct and making half payments in Nov/Dec as that was all I could scrape together.

In January, I managed to secure a new job with a good salary. But the same month, my fixed interest rate period ended and my mortgage payments shot up from approx £1,200/month to almost £3,000/month. I've been making payment every month, but it's crippling me and the arrears stands at over £5k.

So, remortgaging is the obvious solution to roll in the arrears, other debt that I racked up last year, and get a better interest rate BUT here's the bombshell - I've been refused every mortgage out there because Virgin Money has marked my credit file as "unpaid" every month since Sept 2024.

I contacted them and their response: "I can see that whilst you have maintained payments in these months, the arrears will still be reported to credit references so long as the arrears equate or exceed 1 month’s payment (£2,216.90). Unfortunately we cannot remove these arrears markers, as we are legally obligated to ensure account arrears are accurately reported."

I've reported it to the credit agencies and they have temporarily added "disputed" notes to my file, but they tell me it's up to Virgin whether the unpaid markers will be removed.  Based on Virgin's response, I expect nothing will change.

I'm also locked out of getting a loan to pay off the arrears as my credit rating is trashed. So, I'm trapped with crippling monthly payments and no way to pay back the arrears. And every month Virgin continue marking my file as "unpaid". My debt hole is deepening every month because, with £3k mortgage payments, shopping, kids shoes etc all has to go on credit.

I'm honestly desperate and wondering if my only choice is to go bankrupt. I cry every day and am getting so depressed. Can anyone help me see the path out of this mess?

Isthisforreal99

Sorry to be the bearer of bad news but Virgin have done nothing wrong here, they are obliged to report the facts and the facts are you did miss payments and are in arrears. The alternative would have been an arrangement to pay marker which is equally damaging to your credit rating.

Think you need to speak to one of the debt charities to explore options.

Ayr_Rage

Your added comments on your credit files will have no bearing.

Virgin are reporting the facts correctly, there are no lies involved.

Have you tried a broker regarding a mortgage?

LivingOnCredit

Ayr_Rage said:

Your added comments on your credit files will have no bearing.

Virgin are reporting the facts correctly, there are no lies involved.

Have you tried a broker regarding a mortgage?

Yes, it's via the broker that we've tested the market and found no lenders willing to remortgage. You say they are reporting the facts correctly, but the marker says "unpaid" when payments are being made correctly every month. That makes it look like I'm defaulting every month. That's not true or accurate. Is there no way to differentiate between historic default and current missed payments?

CliveOfIndia

Unfortunately, as has been stated already, Virgin have reported the facts correctly.

LivingOnCredit said:

I've reported it to the credit agencies and they have temporarily added "disputed" notes to my file, but they tell me it's up to Virgin whether the unpaid markers will be removed.  

This is correct.  The CRAs cannot make amendments to the information held on your file, they simply report the facts supplied to them by the lender.

LivingOnCredit said:

I'm also locked out of getting a loan to pay off the arrears as my credit rating is trashed.

Looking at it purely objectively, this is not surprising.  Given that you're struggling to meet your monthly payments already, how would you envisage being able to pay an additional amount to a loan every month?

LivingOnCredit said:

My debt hole is deepening every month because, with £3k mortgage payments, shopping, kids shoes etc all has to go on credit.

This is obviously an unsustainable situation.

Please, don't take my comments as being harsh or judgemental - they're simple an objective assessment of the facts as presented.

A debt charity or a mortgage broker, as stated by previous posters, are both good ideas.  Another option may be to consider selling the house and moving to somewhere cheaper?  Not an option to be taken lightly, I fully appreciate, but it may be worth looking at to see if it's a feasible solution?

LivingOnCredit

Isthisforreal99 said:

Sorry to be the bearer of bad news but Virgin have done nothing wrong here, they are obliged to report the facts and the facts are you did miss payments and are in arrears. The alternative would have been an arrangement to pay marker which is equally damaging to your credit rating.

Think you need to speak to one of the debt charities to explore options.

I think I'll have to. It's so deeply depressing that, by marking my file this way, they are pushing me into bankruptcy or IVA. If they stopped marking my file, I could restructure my finances, remortgage and get back in order. But with almost 12 months of "unpaid" on my file, I'm trapped. Makes me wonder if it would've been better for me to have gone bankrupt ages ago and kept my salary instead of paying it to Virgin!

LivingOnCredit

CliveOfIndia said:

Unfortunately, as has been stated already, Virgin have reported the facts correctly.

LivingOnCredit said:

I've reported it to the credit agencies and they have temporarily added "disputed" notes to my file, but they tell me it's up to Virgin whether the unpaid markers will be removed.  

This is correct.  The CRAs cannot make amendments to the information held on your file, they simply report the facts supplied to them by the lender.

LivingOnCredit said:

I'm also locked out of getting a loan to pay off the arrears as my credit rating is trashed.

Looking at it purely objectively, this is not surprising.  Given that you're struggling to meet your monthly payments already, how would you envisage being able to pay an additional amount to a loan every month?

LivingOnCredit said:

My debt hole is deepening every month because, with £3k mortgage payments, shopping, kids shoes etc all has to go on credit.

This is obviously an unsustainable situation.

Please, don't take my comments as being harsh or judgemental - they're simple an objective assessment of the facts as presented.

A debt charity or a mortgage broker, as stated by previous posters, are both good ideas.  Another option may be to consider selling the house and moving to somewhere cheaper?  Not an option to be taken lightly, I fully appreciate, but it may be worth looking at to see if it's a feasible solution?

Thanks for your advice - FYI, I'm not proposing getting more debt with an additional loan (I appreciate that would be madness!). Virgin won't release me to remortgage until the arrears is cleared, not even if it's rolled up into the remortage sum. If I could remortgage to restructure my finances, I could roll all my debt into one, get a lower interest rate and my current salary would easily cover everything, getting us back on track with sustainable monthly payments. It's a doom loop.

Isthisforreal99

LivingOnCredit said:

Isthisforreal99 said:

Sorry to be the bearer of bad news but Virgin have done nothing wrong here, they are obliged to report the facts and the facts are you did miss payments and are in arrears. The alternative would have been an arrangement to pay marker which is equally damaging to your credit rating.

Think you need to speak to one of the debt charities to explore options.

I think I'll have to. It's so deeply depressing that, by marking my file this way, they are pushing me into bankruptcy or IVA. If they stopped marking my file, I could restructure my finances, remortgage and get back in order. But with almost 12 months of "unpaid" on my file, I'm trapped. Makes me wonder if it would've been better for me to have gone bankrupt ages ago and kept my salary instead of paying it to Virgin!

They have to mark your file that way, what you have paid since you missed the payment is going to those missed months and so you are constantly in arrears. In retrospect you possibly should have defaulted and not paid and used that money for the mortgage which is your priority debt. 

As a homeownwr you need to be careful when considering bankruptcy. Is there any equity in that matter.

LivingOnCredit

Isthisforreal99 said:

LivingOnCredit said:

Isthisforreal99 said:

Sorry to be the bearer of bad news but Virgin have done nothing wrong here, they are obliged to report the facts and the facts are you did miss payments and are in arrears. The alternative would have been an arrangement to pay marker which is equally damaging to your credit rating.

Think you need to speak to one of the debt charities to explore options.

I think I'll have to. It's so deeply depressing that, by marking my file this way, they are pushing me into bankruptcy or IVA. If they stopped marking my file, I could restructure my finances, remortgage and get back in order. But with almost 12 months of "unpaid" on my file, I'm trapped. Makes me wonder if it would've been better for me to have gone bankrupt ages ago and kept my salary instead of paying it to Virgin!

They have to mark your file that way, what you have paid since you missed the payment is going to those missed months and so you are constantly in arrears. In retrospect you possibly should have defaulted and not paid and used that money for the mortgage which is your priority debt. 

As a homeownwr you need to be careful when considering bankruptcy. Is there any equity in that matter.

Yeah, loads of equity in the house - over £200k. Somehow, that doesn't seem to factor with the lenders. They seem far more concerned about the 11 months of "unpaid" on my file. And I now have a considerable salary but it goes out every month servicing debt. I have kids and it's our only home, so I don't think they can touch the house if I go bankrupt. But of course I won't base that decision on an online forum (no matter how well informed you all are!).

LivingOnCredit

Isthisforreal99 said:

Sorry to be the bearer of bad news but Virgin have done nothing wrong here, they are obliged to report the facts and the facts are you did miss payments and are in arrears. The alternative would have been an arrangement to pay marker which is equally damaging to your credit rating.

Think you need to speak to one of the debt charities to explore options.

Do you have any experience of the debt charities? There are a few recommended on the MSE pages, but a steer from personal experience would be great.

born_again

LivingOnCredit said:

Isthisforreal99 said:

Sorry to be the bearer of bad news but Virgin have done nothing wrong here, they are obliged to report the facts and the facts are you did miss payments and are in arrears. The alternative would have been an arrangement to pay marker which is equally damaging to your credit rating.

Think you need to speak to one of the debt charities to explore options.

Do you have any experience of the debt charities? There are a few recommended on the MSE pages, but a steer from personal experience would be great.

Best place to ask is in this section.

https://forums.moneysavingexpert.com/categories/debt-free-wannabe

Post a SOA.
You will get totally unbiased advice.

TBH, adding unsecured debt (credit cards) into a secured debt is not the best idea.