One of the main common features that I often find, there is an overarching reluctance in raising a dispute when people experience financial errors on their credit records. The difficulty is that there may not be an awareness of its impact on a financial situation in particular when it comes to details reported to the credit reference agency or equally, there may not be an awareness of how to raise a dispute or whom to contact. Such reasons can prevent you from taking the right action in order to remove the anomaly.

 

I’m going to show you some useful practical solutions you can implement to help remove a default from your credit file and from there enable you to rebuild your creditworthiness.

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Dispute inaccurate credit information on your credit report with the creditor

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If you see an error on your credit file, you should first contact the creditor direct and explain why the default is inaccurate and request for the default to be removed from your credit report. Provide supporting evidence as each case may vary depending on the circumstances.

 

Common incorrect information:

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• Mistaken identity

• Identity fraud

• The creditor has been paid in full or in part before the registration of the default with the credit reference agencies.

• The creditor stopped taking your repayments without advising you, either by not contacting you at all, used an incorrect address or telephone number.

• The default was added very late which was more than 6 months after the missed payments. The Data Protection Act requires a creditor to process your information fairly and accurately.

• You were given credit that you could not realistically repay. In these circumstances, the creditor has a duty to carry out responsible lending practices by checking on your income, expenses and ability to repay.

• The debt is not enforceable due to a faulty credit agreement.

• The debt is beyond 6 years.

• There is a debt relief order in place.

• You were in an abusive or coercive relationship.  You can file a complaint with the Financial Conduct Authority Indeed a recent report centred around “Surviving economic abuse”  calls on the government to work with the credit reference agencies to explore the potential of introducing Restitution Orders as operated in Canada which can address a victim-survivor’s credit history or rating, as a solution to reflect the victim-survivor’s own creditworthiness and not the abuse they have experienced.

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Raise a complaint with the credit reference agencies.

 

Remember the above is not an exhaustive list. If the creditor does not respond or cannot be contacted to remove the default, you can send a complaint to the credit reference agencies, raise a credit report dispute and request for the default to be quashed. This means that the default will be hidden when lenders complete a credit check in the future.

 

In summary the process of removing a default from your credit history involves understanding the 6 year time frame, identifying potential errors and engaging with the creditor or credit reference agencies to raise a credit report dispute with supporting evidence. It’s also important to manage the impact of the default by satisfying the debt even though the default will still remain on your credit file for the 6-year period. The debt will be marked as “satisfied” on your credit file.

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