QUESTION

I was looking through your articles on credit file & repair (extremely helpful) and the one item that I am not completely clear on is default notices on a credit file are they handled in the same way as ccj's (i.e., removed from a persons record after 6 yrs), which brings me to my real question I have a default notice on my record that is about 61/2 yrs old (and probably like a lot of people had forgotten about it) but just recently I was contacted by a finance company stating that they had bought the debt from the original creditors, and therefore were now recovering the debt.

They stated that if I agreed to pay that the debt that I would be issued with a certificate of satisfaction and that they could mark my credit record as having satisfied this debt, is this true?

Finally if I settle this debt and they do mark my file as settled

1) will this then remain on my record for a further 6 yrs? and

2) if this is the case would I not be better off (in terms of my credit record) not settling the debt?

Many thanks for the advise, the web site that you provide has been very informative and helpful, many of the sites out there are very confusing but yours has already helped a lot.

Reply

Yes, defaults are automatically removed on the sixth anniversary. After this period the debt is dead - plain and simple.

A formal default can only be issued where a live agreement exists. i.e.

If you had a hire purchase agreement dated 12 Aug 1993, and you missed the next three payments Sept, Oct and Nov, the creditor would issue a formal default for the three months.

If you did not settle the default, the HP company would probably terminate the HP agreement once terminated no more defaults can be issued, as you cannot be in default of something that is terminated.

If the creditor failed to take action in the six years since the default: tough!

If you have your sums wrong, the creditor, or the new owner of the debt, can take action to recover the debt if under six years since their last formal action.

I would still look to settle for 10% of the debt and let them come back to you with a yes or no, and how much they will settle for: dont be too keen to settle!

A satisfaction notice will only exist for as long as the default has to go to reach its sixth anniversary.

Many thanks to Colin Duguid of Debt 24.com who is taking the time to provide this information as a service to homeworkers.