Creditor refusing to default account despite issuing DNs!

[Moglet]

1st post so my apologies for just diving in and with such a long post.

Got a slightly different problem to most in that we (my partner and I) want to force a creditor (BC) to place defaults on his credit file but they are saying it's not their policy to default accounts. !!

Little bit of history: My parter entered into a DMP with Payplan around Spring 2004 estimated to last about 7.5 years. He made every payment to them on time but PP sent a few late over the years. In the Autumn of this year we decided to take over the plan ourselves and pay everything off having found the DMP was going to take at least another year. Managed to pay everything off over the last couple of months with most creditors accepting F&Fs.

The two BC accounts have never been defaulted with the CFAs so although they're now paid off (in full as they wouldn't agree to a F&F) they're seriously affecting his credit rating with nothing but A2P data showing.

We decided to do a SAR and we've had 6 years worth of statements and copies of letters. For both accounts they issued a default notice in the summer of 2004 - obviously the accounts weren't brought up to date but there isn't any paperwork relating to a termination notice.

The default notices seem to be missing a page. Both say (continued) at the bottom but there's only one page but after doing some googling the 1st page is a carbon copy of other DNs from Mercers. Also on one account they issued 2 notices, in June 04 and Aug 04. As these are copies they are on BC letterheads but the notices are written by Mercers.

There is a letter in Oct 04 saying they are placing him on a repayment plan and it is their policy to state that with the CFA as that's benefical to the account holder...not more than 6 years later it isn't!

As they've issued a default notice, do they have to record that with the CFA or can they issue the threat of one but decide not to actually issue it in favour of a replayment plan?

What we want is for them to record a default with the CFAs back dated to June 2004, meaning it's now dropped off the file.

What can we do?

[jen_br]

Re: Creditor refusing to default account despite issuing DNs

From what I understand you have been maintaining payments.. thererfore your not really in default... you enter default the moment you stop a payment ((could be mistaken))

[Moglet]

Re: Creditor refusing to default account despite issuing DNs

Thanks for your very swift reply jen-br.

I understand what you are saying but all his other creditors (5 more including Barclays Bank) defaulted his accounts shortly after entering into the DMP. They all dropped off this summer/autumn even though there was still a total amount owing of around £16k.

According to the ICO guidelines a debtor shouldn't be in a worse position than one who makes no effort to pay at all but a trashed credit file for 12 to 14 years is worse than one who pays nothing, defaults and continues to pay nothing.

Surely paying £104 a month on a £10k balance equates to well and truly defaulting. I know it's significantly more than a token payment which seems to where the ICO guidelines become a little muddy.

Haven't they shot themselves in the foot by issuing the DNs? I wasn't with my partner at the time but he tells me he went straight from contracted min payments to the DMP. That started in May 04. Unfortunately BC have only provided statements going back 6 years so we're missing what happened right at the start because I don't understand how it took them 6 months to agree to PP's proposal despite receiving payments from May!

[Never-In-Doubt]

Re: Creditor refusing to default account despite issuing DNs

Hiya

Ok to get defaulted you simply cease payments for 6 months. However you state they have already defaulted you which means the last entry on the credit report should show as a "D" at the default date. Only an "S" can supersede a d status (ie settled).

You ought to query this with the cra's as the will use archives to check for a default. Bear in mind, a defaulted account is not the same as being served a default notice under s.87 & s.88 (CCA 1974)....

I'll be back in morning if this doesn't help you out - cos I've just scanned ur message on iPhone! Sadly addicted lol

[Moglet]

Re: Creditor refusing to default account despite issuing DNs

Thanks Niddy for your reply.

I don't think there's been any totally missed payments although can't be sure until they supply statements prior to Nov 2004 (assuming they're yet to arrive) but certainly not 6. He opened his new account in Apr 04 and made his first DMP payment May 04.

Must admit, I'm quite confused about the differences between default notices under the CCA 1974 and defaults on credit files.

They certainly have issued default notices under the CCA 1974 but they have never reported a default to the CRA.

It's further complicated by the fact they haven't treated both accounts the same. Both suffered full interest for the first 6 months until they accepted the repayment plan. The larger debt had interest stopped for the duration. The smaller debt has had varying amounts of interest charged on a monthly basis despite them only providing copies of 2 letters stating what interest they were charging (6% and 12.9%).

Both accounts had their PPI insurance cancelled. Both accounts have had their credit limits reduced during the plan however one account's letters would appear to suggest the account could return to normal at any time by bringing it up to date.

[Never-In-Doubt]

Re: Creditor refusing to default account despite issuing DNs

I'll look at this tomorrow. I'll explain defaults to you lol.

U can be defaulted at any point after you are one whole month late. But they have to do it within 6 months so best way to get an actual s.87 default notice & account termination is not paying for a few months. However going on a dmp means they "can" issue a DN as the oh did not meet the contractual repayments meaning they could default him.

I think I need to check, what is the current state on this account and what do u want to achieve? I'm confused here.....

[Moglet]

Re: Creditor refusing to default account despite issuing DNs

Thanks Nid.

The accounts were settled in full in late Oct. Experian shows a zero balance on both accounts (last updated 7th Nov). Equifax still show the outstanding balance (last updated 7th Oct).

We want defaults applied to the accounts with the CRAs back dated to 2004 (anytime in 04 will do lol) so they are now more than 6 years old and therefore dropped off.

Look forward to hearing from you tomorrow.

[Never-In-Doubt]

Re: Creditor refusing to default account despite issuing DNs

Ok gotcha. So they left the accounts "live" with the cra's for over 6yrs when the default would have dropped off?

By the way, a sar only covers 6yrs. They don't have to send anything after the 6yr period.

[Never-In-Doubt]

Re: Creditor refusing to default account despite issuing DNs

Can u take a screen print of the entries from experian and equifax and email it me to check over and I'll sort this tmw for you

[Moglet]

Re: Creditor refusing to default account despite issuing DNs

Cheers Niddy. That should be in your inbox for tomorrow.

Oh, didn't realise it only covered the last 6 years. Well our first letter got 6 years of statements but nothing else so wrote back again (only last Wednesday) asking for info going back to start of 2004 plus copies of letters. The letters turned up today so either they've acted really really quickly to our 2nd letter or these were following anyway 10 days later. They have sent letters dating back to May/Jun 2004 and a random one dated 2002 for some sh*te or something so maybe they'll oblige as they have responded to the SAR really quickly.

[Never-In-Doubt]

Re: Creditor refusing to default account despite issuing DNs

Cheers Niddy. That should be in your inbox for tomorrow.

Oh, didn't realise it only covered the last 6 years. Well our first letter got 6 years of statements but nothing else so wrote back again (only last Wednesday) asking for info going back to start of 2004 plus copies of letters. The letters turned up today so either they've acted really really quickly to our 2nd letter or these were following anyway 10 days later. They have sent letters dating back to May/Jun 2004 and a random one dated 2002 for some sh*te or something so maybe they'll oblige as they have responded to the SAR really quickly.

Hiya

Ok i've checked all the screen dumps (thanks for those - made life so much easier) however, you're not going to like this - well half of it you will, half you wont!

Bad news:
The entries are accurate - he is on an arrangement to pay, therefore they can update with this all they want.

Good news:
The entries are actually not derogatory in any way! These accounts are not going to have much effect on his credit believe it or not!

Bascially, once the AP has completed one will drop off each month that passes, so in the next 3-4 years the entries would be totally cleared however an AP marker is not classed as "derogatory" - it is frowned upon by some lenders but they cannot auto decline for such a marker, you could have it for a number of reasons (fraud and card cloning are the main two reasons for refusing to pay thus creating an AP or U (unclassified) marker being added).

I'd not worry about this, yea there are a couple of late payment markers with the barclaycard account that will eventually fall off. BUT i'd never suggest you try for a default now, no chance! Not worth it. Stick to the arrangement and if you know you'll clear the balances in the next 2 years you're better leaving things as they are. If it will take 3+ years to clear the debts then you may have a year or two of AP markers showing but that's it - better than a default, put it that way!

An AP marker won't stop you getting a bank account or credit card/loan - a default would. You can argue (appeal) any declines and make any excuse you like - such as "they hiked the rate, I refused it so they closed my account and told me to pay £xx per month". Then act daft about the AP marker as though you never knew it was there - these things are easy to appeal/blag ;D

I'd leave things as they are, to be honest with you. gh