How to check status of debt

Kittymumof4

Hi, we're starting a Self managed DMP and we're confused about one of the debts. We had a letter in December asking for the full amount to be paid but after that we've jusy had letter asking us to contact them and a letter from Wescot to say the debt has been transferred to them but as far as I can see we've not had a default notice. It's been 10 months since we haven't done anything with this account. (Overdraft)

Its now been transferred to Moorcroft who are asking us to contact them about payments but I don't think the account has defaulted. What should we do?

I've tried checking the status of the debt on our credit report with Experian but have to pay to see the details.

fatbelly

Overdrafts can be different and can drag on for years. Just let them work through their process. Is the balance fixed or are they still adding fees & charges?

Full credit reports are free. If you want the Experian one, go through

https://www.experian.co.uk/consumer/statutory-report.html

sourcrates

Moorcroft will have been engaged to attempt to collect your outstanding balance, the debt will likely still reside with your bank.

The clue is in the terminology they use, do they mention "their client" when referring to the bank?

If your debt is sold you will be notified in writing of that fact, and it won`t default until they send you a default notice sent under sec 87(1) CCA.

Makes things easier when you know what to look for.

Kittymumof4

Thanks both. They're not adding any fee's or interest to the account.

Moorcroft are saying they are responsible for the account.

So do we wait until it defaults? I was hoping to get the defaults as soon as possible so it has less impact on mortgage opportunities in the future. 😬

Brie

"Responsible" doesn't mean they own the debt. Lots of creditors pass the collection over to such a firm but it can ping pong back and forth and be batted on to someone else at a later date. You should be informed when this happens but frankly I have my doubts that it's adhered to 100%. Question it and they'll say the letter must have got lost in the post and they'll magic up something suitable instead. I would always question what proof they have of the debt before paying - but I'm cynical that way.

Kittymumof4

Okay thanks. So should I only be paying the debts that have been sold?

sourcrates

https://forums.moneysavingexpert.com/discussion/comment/81967024#Comment_81967024

Well that`s what happens to the vast majority of defaulted debts, they may go through various collection companies first, and if no fruit is bourne, the creditors last throw of the dice is usually to sell it onwards in a bulk package alongside hundreds of other accounts.

Once its sold, you more or less know that its going to now stay with the company that bought it, so it should have defaulted, no more interest will be added, and it won`t be sold on again, although it may be passed to a collector (again) this time with the debt buyer as the new owner.

Its just a never ending game that goes on for ever, which is why its just easier to use the default as your baseline, and if you want to pay after that, then go ahead, no matter who the owner is.

Kittymumof4

Okay thanks. I've just set up monthly standing orders to the debts I know have definitely defaulted at the moment, including those that are being managed rather than sold.

I'm waiting for the Experian report to come through to confirm if the others have definitely defaulted before paying those.

The overdraft one, so I have to just wait for it to eventually default? I'm worried about how all of this will affect our mortgage and hoped the defaults would all be cleared in 6 or 7 years.

sourcrates

If you want to "move things along" you can write to the bank asking them to close/default the account, as your intention is then to repay via debt management.

It may or may not be of any help, but at least you are being proactive.

Kittymumof4

Okay thanks. So if we wanted to move house in a few years time and the mortgage amount was lower than our current mortgage, would we struggle to get a mortgage because the default would still show?

ManyWays

Basically yes, but you would have the same problem if just a payment arrangement showed. It is having a problem with your debts that a mortgage lender cares about, not your credit score.