Tweet
Ok basically the governing legislation behind Defaults and AP markers etc falls within the scope of the ICO as detailed below and within the attached document.
The attached document is the latest default / cra guidelines. For this exercise we're specifically sticking to points 21-22
Ok, here's the attachment ---> default_tgn_version_v3 doc.pdf
This is how the ICO portray things:
Arrangements to pay
There you go, that's all you need to confirm that there should be NO late payment entries.
The attached document is the latest default / cra guidelines. For this exercise we're specifically sticking to points 21-22
Ok, here's the attachment ---> default_tgn_version_v3 doc.pdf
This is how the ICO portray things:
Arrangements to pay
21 An ‘arrangement to pay’
This involves a temporary, short-term (up to six months) arrangement where the lender agrees to accept reduced payments.
The original payment terms will still be shown on the credit reference file and arrears will accrue which will be shown on the monthly status record.
The account will be marked by an ‘arrangement to pay’ marker (which distinguishes the account from one where the customer has behaved less responsibly).
Where such an ‘arrangement to pay’ breaks down, a default may be filed when the total value of the arrears is equivalent to three monthly payments under the original terms.
If a customer fails to return to contractual payments after an ‘arrangement to pay’ has expired, then the lender can file a default immediately, as long as this would not place the customer in a worse position than they would have been in, had they not made the arrangement.
This involves a temporary, short-term (up to six months) arrangement where the lender agrees to accept reduced payments.
The original payment terms will still be shown on the credit reference file and arrears will accrue which will be shown on the monthly status record.
The account will be marked by an ‘arrangement to pay’ marker (which distinguishes the account from one where the customer has behaved less responsibly).
Where such an ‘arrangement to pay’ breaks down, a default may be filed when the total value of the arrears is equivalent to three monthly payments under the original terms.
If a customer fails to return to contractual payments after an ‘arrangement to pay’ has expired, then the lender can file a default immediately, as long as this would not place the customer in a worse position than they would have been in, had they not made the arrangement.
Examples
1. If a customer makes an ‘arrangement to pay’ at a reduced rate but breaks that arrangement by making no payments for three months, the lender should only automatically file a default if
So no default should be filed if the lender normally records defaults when accounts are six monthly payments in arrears and the customer has not yet reached that level of indebtedness, even though he may have missed payments under the ‘arrangement to pay’.
2. If a lender accepts an ‘arrangement to pay’ as an alternative to filing a default, and the customer fails to make any of the agreed repayments, then a default can be filed straight away.
1. If a customer makes an ‘arrangement to pay’ at a reduced rate but breaks that arrangement by making no payments for three months, the lender should only automatically file a default if
- the total value of the arrears is equivalent to three monthly payments under the original terms, and
- the lender would normally file a default at this stage in the arrears process.
So no default should be filed if the lender normally records defaults when accounts are six monthly payments in arrears and the customer has not yet reached that level of indebtedness, even though he may have missed payments under the ‘arrangement to pay’.
2. If a lender accepts an ‘arrangement to pay’ as an alternative to filing a default, and the customer fails to make any of the agreed repayments, then a default can be filed straight away.
Comment