Credit reports and defaults
Discussion
I have some questions about defaults on credit reports.
I recently obtained a copy of my credit report from Experian, and there are 2 defaults listed.
Both are for the same debt, an unpaid overdraft from a well known building society. The debt came about when I went travelling overseas for 4 years. After around 1.5 years, my debit card was retained by an ATM in Indonesia, whilst the account was £700ish overdrawn (an arranged overdraft). At the same time I was locked out of my internet banking.
Since I had another bank account this didn't present a huge problem, I just used the other account.
When I returned to the UK 2.5 years later, it became clear that this debt had been sold to a debt collection agency. They proceeded to send weekly letters requesting contact and offering to settle the debt at a lower price. I have currently ignored these letters.
Both the original building society and the debt collection agency have registered a default on my credit report, both dated about a week apart and over 4 years old now.
My question is, after the 6 years expires and these defaults are removed, what's to stop the debt collection agency re-registering the default on the report? Presumably they can't do this? I can afford to settle the debt easily, but since these defaults will remain on the report regardless until the 6 years is up, and the original creditor has now written off the debt, I would prefer not to pay any money to this DCA. From my reading of various forums, it seems a CCJ is unlikely from this DCA.
Sorry for the long post. Any advice?
I recently obtained a copy of my credit report from Experian, and there are 2 defaults listed.
Both are for the same debt, an unpaid overdraft from a well known building society. The debt came about when I went travelling overseas for 4 years. After around 1.5 years, my debit card was retained by an ATM in Indonesia, whilst the account was £700ish overdrawn (an arranged overdraft). At the same time I was locked out of my internet banking.
Since I had another bank account this didn't present a huge problem, I just used the other account.
When I returned to the UK 2.5 years later, it became clear that this debt had been sold to a debt collection agency. They proceeded to send weekly letters requesting contact and offering to settle the debt at a lower price. I have currently ignored these letters.
Both the original building society and the debt collection agency have registered a default on my credit report, both dated about a week apart and over 4 years old now.
My question is, after the 6 years expires and these defaults are removed, what's to stop the debt collection agency re-registering the default on the report? Presumably they can't do this? I can afford to settle the debt easily, but since these defaults will remain on the report regardless until the 6 years is up, and the original creditor has now written off the debt, I would prefer not to pay any money to this DCA. From my reading of various forums, it seems a CCJ is unlikely from this DCA.
Sorry for the long post. Any advice?
My understanding is that after 6 years, the debt will become statute barred, and the default will also be wiped from the credit report. From what I've read, it sounds like once the six years are up, I will still technically owe the money, but nothing can be put on my credit report about it, and I cannot be taken to court etc.
Some of you have picked up on a moral issue which is fair enough, but repaying the debt now would only be furnishing the profits of a debt collection agency. It would not go to the original creditor as the debt has been sold and settled from their perspective.
Even if I repay the full amount now, the default will remain on file until the 6 years is up. So is there any advantage or reason why I should settle with the DCA?
Some of you have picked up on a moral issue which is fair enough, but repaying the debt now would only be furnishing the profits of a debt collection agency. It would not go to the original creditor as the debt has been sold and settled from their perspective.
Even if I repay the full amount now, the default will remain on file until the 6 years is up. So is there any advantage or reason why I should settle with the DCA?
PurpleMoonlight said:
Although the credit record and statute barring both operate a 6 year rule, the latter will be reset if you acknowledge the debt within the 6 years.
Yes I have read that. That's why I have been ignoring all contact up to now.So it seems that unless the DCA push for a CCJ, there would be no advantage to me (in a purely selfish sense) of paying back the debt. Either way my credit report will be poor until the defaults are removed.
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