Dealing with defaults

[Dealster40]

Hello,

 

I am new to this forum, so firstly hello!

 

I have 3 defaults on my credit file, with between 3 and 5 years remaining till they drop off.

 

 

I am trying to decide the best way to deal with them and improve my credit rating as quick as possible.

 

 

I have read around ref F&F settlement offers etc... and would like a clear answer on the best way to go.

 

From what I can see I have the following options:

 

1. Leave as is and make minimum payments (the entire acount will drop off after 6 years anwyway)

2. Make a F&F offer demanding that defaults are removed and account settled (anyone every achieved this?)

3. Make F&F offer and accept file marked as partially settled

 

I want to apply for a mortage at some point, hence why I am now trying to get these defaults dealt with.

 

If no matter what I do the default will remain, then I might as well just make a F&F offer

(or mimimum payment) and save myself some money in the long run.

 

Any advice is greatly appreciated.

 

Cheers

[silverfox1961]

Hi and welcome to CAG

 

With defaults, creditors have two options.

 

1 Happily remove them for you

 

2 Pluck their eyeballs out with a red hot poker.

 

Guess which one they would choose? Yup, the second option!

 

In answer to your questions.

 

1 I would but only after they have supplied a fully complaint copy of the agreement (on the assumption these debts are pre April 2007)

 

2 This is the best you could hope for. You would want any agreement to be in writing. I have only seen a handful of cases in all my time here and the majority had less than 18 months to go. I doubt any creditor will agree to this but if you don't ask, you don't get.

 

3 Don't bother with this option. A settled or partially settled debt means nothing to future creditors as it is the default that remains that will cause the problems for you.

 

Finally, if any of the defaults are made up purely of charges (and associated interest) then you can get the charges removed/refunded and with that the default can go as well.

[Dealster40]

Thank you silverfox1961. So basically, there is no point in settling the defaults early unless the default itself is removed and marked up as fully settled.

 

However, if I do chose to go down the route of F&F, will the "partially settled" mark come off at the same time after the defailt?

[silverfox1961]

The 'partially settled' should come off at the same time as it formed part of the default. As it is, the default will fall off after 6 years paid or not.

 

With any F&F, always deal in writing, start off with a relatively low figure (say..10%) with a higher figure in mind that you will not go over.

 

Always get it in writing that any remainder of the debt after the F&F is not sold on to any other party as if you do not include this, they can sell on the remainder (which is lawful unfortunately)

[dx100uk]

CCA request and reclaiming first. just remember:

 

 

All references to a defaulted debt must be removed from your credit files after 6 years

has passed from date of default, whether paid off or not.

.

{the WHOLE ACCOUNT WILL VANISH, never to return}.

.

{however, this does not mean the debt itself is not still owed

consider a CCA request.}

.

This is so that someone who continues paying something

- even after 6 years from default

- should not be at a disadvantage to someone who pays nothing after default

and ends up with a clean file after 6 years.

[Dealster40]

Another quick question if you don't mind! If a company obtains a CCJ on a debt which is already defaulted, does the 6 year clock start again on the CCJ?

 

Cheers

[dx100uk]

they are each recorded for 6yrs paid or not.

 

 

dx

[WindySock]

CCJ stays on your report for 6 years from judgment if not paid within one calendar month.

 

Any default on the account is a separate entry and would still drop off 6 years from the default date.

[Dealster40]

Sorry to bring about my thread again however I just need to clarify one more thing.

 

In the eyes of creditors is a partially settled default much worse than a fully settled default? If I still have other defaults, I suppose it makes no real difference in the grand scheme of things!

[citizenB]

Sorry to bring about my thread again however I just need to clarify one more thing.

 

In the eyes of creditors is a partially settled default much worse than a fully settled default? If I still have other defaults, I suppose it makes no real difference in the grand scheme of things!

 

A fully settled default will let other lenders see that you have paid the debt in full. Partially settled will indicate that not only did you default, but that you came to an arrangement for less than the full balance.

 

Unfortunately not only will defaults trash your credit file one way or another for 6 years, you will then need to rebuild a credit history.

[dx100uk]

I would not waste money paying any accounts that are defaulted if I were to be honest

simply extends the statute barred date too.

 

 

you need to action post 5

 

 

dx

[Dealster40]

You mean not even affordable payments through a DMP? I suppose nothing changes up until the point when they claim through the courts.

[citizenB]

Are you making payments to the account ? If not, when did you cease ?

[Dealster40]

I ceased making payments 3 months ago now, however I wil be in the position to start making payments again next month.

[citizenB]

I ceased making payments 3 months ago now, however I wil be in the position to start making payments again next month.

 

 

Ah righto, I didn't understand the reference to statute barred timing made by dx in a previous post. The account will not be statute barred for some 5 years and 9 months ! The reporting should cease 6 years from the default date. If you enter into an "arrangement to pay", I think they continue to report until the account is cleared.