DMP and credit file

bristol2020 · 23 April 2019 at 11:08AM

Morning all,
3 questions - how does being on a DMP affect a credit file/score?
And as I am close to ending my DMP will it show up when its closed?
Lastly - what things can I do to improve my file/score (thinking medium term here - i.e chances of getting a mortgage etc)

Many thanks in advance

Willing2Learn · 23 April 2019 at 3:57PM

Hi,

Your credit score should be ignored as lenders neither see it nor use it. A DMP does mean there will be negative data recorded on your credit files. If the accounts have all been defaulted, then they will automatically be removed from your credit files, six years from the date of default. Were all the accounts defaulted?

To make yourself more attractive to mortgage lenders you will need to demonstrate that you can successfully manage credit accounts by having positive data recorded on your credit files. If you currently still have adverse data recorded on your credit files, then you will need a good mortgage broker.

bristol2020 · 24 April 2019 at 8:20AM

So all my debts have defaulted bar 1. All have fallen off my credit file apart from 1 which will disappear in November and 1 which did not default but is now paid off - but will stay put for 6 years.
I don't have any credit as per the guidelines I followed when undertaking my DMP.
I am however, fortunate that I do have significant savings (inheritance).
So what is my best option to improve my chances of getting a mortgage - do I apply for a high interest credit card - use it and pay it off in full each month etc? I have seen conflicting suggestions to this previously.

bristol2020 · 24 April 2019 at 9:25AM

So I just read an old post on here - relating to my own question. Basically my DMP has been running for the last 6/7 years. One of the debts was for a payday loan to Myjar which had been passed to DCA to collect on their behalf. Pretty much each month they have made a late payment mark on my credit file despite me not having missed a payment on my DMP.
So this being the case - as the debt has now been repaid it will stay on my credit file for 6 years. Am I right in thinking that I can complain and get this removed - as the debt should have been defaulted when I started the DMP (as payment amount within the DMP was less than contractual amount of loan repayment)?

Suseka97 · 24 April 2019 at 12:28PM

I admit having a late payment marker is odd, because if not defaulted it would normally show as AR or AP (meaning you are in an arrangement to pay). With that said anything other than a default will mean it'll remain until 6 years from the date the account was settled or satisfied in some way.

You should be aware there is no legislative requirement for creditors or DCAs to default - there is only ICO guidance that advises a default may be recorded when you are 3 months in arrears and normally by the time you are 6 months in arrears - so there is no guarantee they will be helpful with a backdate, but there's no harm in trying.

I had a debt with Halifax who took over a year to default me and prior to settlement the account was being managed by a DCA. Several months after the account was 'settled' I decided to give it a go and contacted Hfx complaining that I felt I had not been treated fairly blah...blah. After a few weeks I was contacted by Hfx and following a short conversation they agreed to backdate the default. So its always worth a punt.

sourcrates · 24 April 2019 at 1:32PM

Currently a debt mangement plan is an informal arrangement between you and your creditors, to repay your debts at a more affordable rate.

As it isnt a regulated debt solution, such as an IVA or a DRO, the arrangement itself does not feature on your credit file, nor do you appear on any insolvency register, however, the creditors can choose how they mark your payments made to these debts.

Most will follow ICO guidelines and default the account, in line with guidence, some may choose to use AP markers, the difference between the two.......defaults disapear 6 years after date of default no matter what happenes, AP markers stay on your file a further 6 years after the debt is repaid, so potentially a very long time.

When your coming to the end of any debt solution, never, ever just expect the creditors to sort out your credit file, you must go through it yourself and get inacurate info altered or removed, backdated, or whatever.

You must complain to the creditor themselves first (not the CRA) if you remain unhappy after the complaints process, then escalate to the ICO, they deal with all things related to credit file information.

bristol2020 · 24 April 2019 at 2:41PM

Thanks for the advice - i will give that a go and see what happens

Willing2Learn · 24 April 2019 at 2:58PM

When asking for the default, then use the guidance referenced in the thread linked below. (Pay particular attention to post #4).
Punished for DMP

bristol2020 · 25 April 2019 at 11:23AM

bristol2020 wrote: »

So what is my best option to improve my chances of getting a mortgage - do I apply for a high interest credit card - use it and pay it off in full each month etc? I have seen conflicting suggestions to this previously.

Any thoughts on the above question - will it help my situation ?

Suseka97 · 25 April 2019 at 1:17PM

There's a 'Credit file and Ratings' thread under the 'Essential Money' forum - so you might find you'll get a better response if you post that question there

sourcrates · 25 April 2019 at 1:31PM

bristol2020 wrote: »

Any thoughts on the above question - will it help my situation ?

I think there is a myth that you must use a credit card to build credit history, most utility companies report to your credit files these days, mobile phone contracts, bank accounts, it all helps build history.

Other important factors are a stable address history, been on the electoral role, at that address, for a good while, obviously no defaults, late payments, or other negative information.

DMP and credit file

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