AR/AP markers ruin credit file for friend.
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Was talking to my friend last night, He said he was rejected for a credit card and was a bit suprised by this as he has never missed a payment on a CC. He asked me to look over his credit file which I was happy to do. I noticed a year ago he has a bunch (many many months) of "AP" markers on his file for two credit cards. What happened here I thought.
When I asked him about it he said that things got tight and he started to worry that he wasn't going to be able to make the minimum payments on 2 credit cards. So before any missed payments or anything bad he called his credit card companies (the right thing to do) to discuss. They had a brief chat and advised him to pay a fixed sum a little under his minimum payment amount. (an AP). However, a few days later he reassessed his finances, tightened his belt and asked both CC companies to raise his payment amount to an amount that was now £50 ABOVE what would have been the minimum payment. He kept that up and recently cleared the cards off if full. Now, everything I am reading online says these AP markers are "as bad" as Defaults and even CCJ's!!
So basically his credit file is really badly scared by this (for 6 years!). Unknown to him they were damaging his file because as far as he was concerned he had never missed a payment and his AP was MORE than the minimum payment would have been. He thought (understandably) he was being responsible and at no point missed a payment or paid less than what would have been minimum payment.
Surely he can do something about this? Doesn't seem fair at all. Should the CC companies have agreed to put him on AP?? At every step he was doing the right thing and being as sensible as possible, voluntarily going without luxuries to pay more than the minimum payment to clear the debt.
When I asked him about it he said that things got tight and he started to worry that he wasn't going to be able to make the minimum payments on 2 credit cards. So before any missed payments or anything bad he called his credit card companies (the right thing to do) to discuss. They had a brief chat and advised him to pay a fixed sum a little under his minimum payment amount. (an AP). However, a few days later he reassessed his finances, tightened his belt and asked both CC companies to raise his payment amount to an amount that was now £50 ABOVE what would have been the minimum payment. He kept that up and recently cleared the cards off if full. Now, everything I am reading online says these AP markers are "as bad" as Defaults and even CCJ's!!
So basically his credit file is really badly scared by this (for 6 years!). Unknown to him they were damaging his file because as far as he was concerned he had never missed a payment and his AP was MORE than the minimum payment would have been. He thought (understandably) he was being responsible and at no point missed a payment or paid less than what would have been minimum payment.
Surely he can do something about this? Doesn't seem fair at all. Should the CC companies have agreed to put him on AP?? At every step he was doing the right thing and being as sensible as possible, voluntarily going without luxuries to pay more than the minimum payment to clear the debt.
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An AP is not as bad as a default or CCJ.
Did your friend say if the card company had advised them that an Arrangement to Pay would be marked on their credit file? They should have been told.I work within the voluntary sector, supporting vulnerable people to rebuild their lives.
I love my job
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Willing2Learn wrote: »An AP is not as bad as a default or CCJ.
Did your friend say if the card company had advised them that an Arrangement to Pay would be marked on their credit file? They should have been told.
Everything I have read thus far suggests it is as bad as default. https://forums.moneysavingexpert.com/showthread.php?t=4178099
He said he had no idea what AR/AP markers are (quite understandable from his layman point of view) He said the credit card companies were very nice and happy to "help" him setup a direct debit payment. So no, he had no clue.
I see other people have similar problems. https://forums.moneysavingexpert.com/showthread.php?t=5487763
This doesn't seem right at all. He has never missed a payment and always paid more than minimum payment. This is grossly unfair.0 -
Well i suppose it is factually correct if rather unfortunate - he did "make an arrangement to pay" an amount less than the contract amount, even if he then "returned to term" without making any reduced payments.
So for a credit perspective if reflects a sign of distress - which the OP acknowledges was the case, albeit briefly.
No harm in try to get them removed though.0 -
Brock_and_Roll wrote: »Well i suppose it is factually correct if rather unfortunate - he did "make an arrangement to pay" an amount less than the contract amount, even if he then "returned to term" without making any reduced payments.
So for a credit perspective if reflects a sign of distress - which the OP acknowledges was the case, albeit briefly.
No harm in try to get them removed though.
I mean if its all technically correct then the system is broken. He has months and months of AR markers on his file and it's just caused him to be rejected. (his file is otherwise excellent).
Having never missed a payment or paid less than minimum I think this is wrong.0 -
Like I said:… He said he had no idea what AR/AP markers are (quite understandable from his layman point of view) He said the credit card companies were very nice and happy to "help" him setup a direct debit payment. So no, he had no clue...
… This doesn't seem right at all. He has never missed a payment and always paid more than minimum payment. This is grossly unfair...
Personally, if I was your friend, I would make a complaint. On the grounds that I would never have entered into an Arrangement to Pay if I had been advised by the credit card company that my credit file would be negatively marked for six years. It could be argued that your friend was misled.Willing2Learn wrote: »… They should have been told.I work within the voluntary sector, supporting vulnerable people to rebuild their lives.
I love my job0 -
Willing2Learn wrote: »Like I said:
Personally, if I was your friend, I would make a complaint. On the grounds that I would never have entered into an Arrangement to Pay if I had been advised by the credit card company that my credit file would be negatively marked for six years. It could be argued that your friend was misled.
Yes I've told him to do that. I'm shocked the exact same thing happened with 2 credit cards though. They seem very very keen to get people into AR?0 -
Was the agreement in writing?
Although “annoying” the markers are correct for the status of the account.
Also why was your friend applying for a credit card having been behind on 2 and not able to make payments ?0 -
Was the agreement in writing?
Although “annoying” the markers are correct for the status of the account.
Also why was your friend applying for a credit card having been behind on 2 and not able to make payments ?
He wasn't behind on any. And was able to make payments.
did you read my post?0 -
I see it as they had the agreement of the lender to pay less than the contractual amount without the addition of the usual fees, they therefore had an arrangement and is reported as such. What they actually paid is of no relevance, they had the arrangement in place if they wished to use it. Should my bank report my overdraft facility as I have never used it but the facility is there ?0
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