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    • pale_waves
    • By pale_waves 7th Jul 18, 9:30 PM
    • 1Posts
    • 0Thanks
    pale_waves
    Future relationship with a bank I defaulted with previously
    • #1
    • 7th Jul 18, 9:30 PM
    Future relationship with a bank I defaulted with previously 7th Jul 18 at 9:30 PM
    Hi all,

    I know this one might be difficult to answer and each bank will have its own policies, but I wondered if anyone had personal experience or even someone that works for a high street bank may be able to help.

    A number of years ago I got myself into trouble with a couple of banks (namely Halifax and Lloyds TSB). I ended up defaulting on my overdrafts and the accounts went to a debt collection agency. It has all been paid off and the defaults are due to drop off my credit file within the coming months.

    I regret getting into that mess, but I am older and wiser now.

    Anyway, here's my question. If I applied for a current account with either of the above banks and I'm accepted (I tried their eligibility checker when it was on their websites last year and it said excellent chance), would my previous issues be held against me for all future due to my past track record? So for example if I wanted a mortgage in 5 years time, will my past relationship with that bank still be brought up and potentially cause me to be declined?

    Now if I applied to a bank that I've never been with before - say Santander for example - once my defaults have dropped off my file they'd have no idea that I'd struggled in the past, and therefore I'd expect that nothing would flag up of concern.

    Basically I'd like to know if I'm going to be penalised forever by Halifax and Lloyds even after the defaults are clear from my file and I have a new account in good standing?

    Many thanks
Page 1
    • zx81
    • By zx81 7th Jul 18, 10:24 PM
    • 19,362 Posts
    • 20,688 Thanks
    zx81
    • #2
    • 7th Jul 18, 10:24 PM
    • #2
    • 7th Jul 18, 10:24 PM
    Not penalised, but they may take it into account when processing your application.

    However, LBG aren't renowned for having a one strike policy, though there's no guarantee.
    • Emily Joy
    • By Emily Joy 8th Jul 18, 5:20 AM
    • 190 Posts
    • 78 Thanks
    Emily Joy
    • #3
    • 8th Jul 18, 5:20 AM
    • #3
    • 8th Jul 18, 5:20 AM
    So for example if I wanted a mortgage in 5 years time, will my past relationship with that bank still be brought up and potentially cause me to be declined?

    Basically I'd like to know if I'm going to be penalised forever by Halifax and Lloyds even after the defaults are clear from my file and I have a new account in good standing?
    Originally posted by pale_waves

    In my experience LBG is unlikely to offer you a mortgage or even a proper (not basic) account after default.
    • 18cc
    • By 18cc 8th Jul 18, 4:55 PM
    • 852 Posts
    • 572 Thanks
    18cc
    • #4
    • 8th Jul 18, 4:55 PM
    • #4
    • 8th Jul 18, 4:55 PM
    I don't think anyone on here will know for certain, but probably the best thing you can do is make an account opening appointment at a Lloyds branch and pop in an see what they say - ie don't do it online.
    • Westie983
    • By Westie983 8th Jul 18, 10:13 PM
    • 4,610 Posts
    • 15,143 Thanks
    Westie983
    • #5
    • 8th Jul 18, 10:13 PM
    • #5
    • 8th Jul 18, 10:13 PM
    Hi,

    You will probably face a problem opening any credit accounts at either of the banks you have defaulted at even if they have dropped off your credit file.

    You wil stil have a profile at the defaulted banks and may find its a straight decline due to your past history.

    I would think about getting an mortgage or any credit accounts at a bank that is not one of the defaulted ones.

    I think you also need to wait for your credit file to be updated with the defaults cleared and dropped off your file.

    Well done for trying to sort out your credit file and taking ownership of your future.

    Westie983
    Save 12k in 2019 #10 Total (16000)+0/12000 = 0.0%
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    I'm a Board Guide on Budgeting & Bank Accounts, Debt-Free Wannabe, Disability Money Matters, and Savings & Investments. I'm a volunteer helping the boards run smoothly, but I'm not a moderator, and do not read all posts. If you see an inappropriate/illegal post then email forumteam@moneysavingexpert.com
    • davethorp
    • By davethorp 9th Jul 18, 5:38 PM
    • 1,471 Posts
    • 1,080 Thanks
    davethorp
    • #6
    • 9th Jul 18, 5:38 PM
    • #6
    • 9th Jul 18, 5:38 PM
    I have accounts with RBS, Halifax and Santander despite defaulting with them in the past (in Santander!!!8217;s case it was back when they were Abbey)

    In the case of RBS and Santander I also have access to a reasonable amount of borrowing so yeah it is possible to reestablish a relationship with a bank you previously defaulted with and gain access to borrowing. Obviously its not certain and your mileage may vary but in my experience banks can be quite forgiving

    • knightfox
    • By knightfox 9th Jul 18, 9:00 PM
    • 310 Posts
    • 79 Thanks
    knightfox
    • #7
    • 9th Jul 18, 9:00 PM
    • #7
    • 9th Jul 18, 9:00 PM
    start at the bottom and see what they say try a basic account first and then work up from there
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