www.iva.co.uk

Hi,
Sorry that I haven't been around for a while, been very busy but I have been watching....
Anyway, I noticed a thread recently about creditors still defaulting monthly on peoples credit file so I checked mine ( 1st time ) and guess what ?
I've got monthly defaults from all my creditors since I started my IVA in Aug 07.
Why are they doing this, are they supposed to be doing this and how will it affect my credit rating once my IVA is completed ?
Will it still be showing on my file for another 6yrs once my IVA is completed (as defaults will remain on file for 6yrs) thus making my IVA/Insolvency last for 12yrs?
I can-not find the thread that I saw so please can anyone guide me on this?

Thanks In Advance
E.M.

Hi Endsmeet, all the information from Storm is in this thread:

http://www.iva.co.uk/forum/topic.asp?TOPIC_ID=22164

Hi Skippy,
Thanks for that, if I read it correctly,am I correct in saying that all defaults will drop off after 6yrs when they were ORIGINALLY started and as all of my defaults started one month after my IVA was accepted they should be off when my IVA term is finished?

Have you checked Experian of another company ?

I can't pick up the thread Skippy - just one question are creditors allowed to register defaults floowing registration of an IVA; I thought they were not allowed to do it. Thanks

Any questions would be best directed at Storm as he is far more qualified than I am to answer them! I'm not sure why you can't open the link Elv, but this is what Storm posted:

These are the guidelines from the ICO about the issue of Defaults.... when / how and if they should appear on a credit file.

http://www.ico.gov.uk/upload/documents/ ... %20doc.pdf

There is legal redress if the lender and or the CRA do not process data fairly or provide a true reflection of the account status.

AND

The lender has a duty to accurately report the status of an account - the ICO gave guidance that compelled lenders to default an IVA as near to the acceptance date as practical. Certain lenders do not crystalise the account immediately (it depends on how their funding lines work) but in any case you can ask the lender to report the default accurately.

Certain lenders and DCA's continue to report the status of the account throughout the lifetime of the IVA - each month updating the account in default.

The ICO states that the default will remain on the credit file for 6 years from the date it was originally defaulted and no longer. A defaulted account is removed from your report after 6 years whether or not you have paid the debt in full and even if the lender / DCA continues to update the account at the CRA.

I am however aware of two DCA's who have continued to report defaults beyond the 6 year term - court orders have been obtained to stop the consumers credit report reflecting the default state of the relevant accounts.

Very recent guideance has been issued by the ICO in relation to unenforceable credit agreements:

The Information Commissioner's view is:

"In view of the enactment of section 15 of the 2006 Consumer Credit Act, the ICO has given fresh consideration to the circumstances in which the credit reference agencies should be permitted to record details of unenforceable credit agreements. In doing so we have had particular regard not only to the clear legislative intent that the absence of a signature on a credit agreement should no longer be an absolute bar to enforcement, but also to the following factors;

• The question of whether a legal liability exists in relation to a credit agreement is quite separate from the question of whether such a liability may be enforced by the creditor.
• Where a liability does exist, creditors have a legitimate interest in sharing relevant information about that liability, including information about whether the amount due has been repaid. Such information may properly inform responsible lending decisions, regardless of whether the liability is enforceable.
• Responsible lending decisions are dependent upon lenders receiving accurate information about individuals’ ability (and/or inclination) to repay their debts.

Where a credit agreement clearly existed and credit has been provided to the debtor, but the debtor is not obliged to repay the loan due to the provisions of the Consumer Credit Acts, this does not mean that there was no agreement in the first place. It simply means that there was no enforceable regulated agreement."

Sorry that the latter part of the post is very technical - but hopefully this explains in the detail required that the default will remain on the file from the start of the IVA (or as near as possible) and that even if the lender / DCA continues to report the status of the account during the IVA at 6 years it will be removed at account level so that no further reference is made. If your credit file reflects the default at the end of the 6 years an application can be made to the court if the lender /DCA doesn't cease.

Thanks Skippy for your trouble - our computer just said "page load error" - anyway thank you again for the trouble you took.

Hi Endsmeet, I have defaults on all my accounts showing on my Credit File too, however I have checked this out and a Default will only remain on file for six years from the date of default whether settled or not, so effectively six years from the actual default date, the Credit Reference Agencies shoudl automatically delete these, but do check as this does not always happen, hope this has helped

Hi Jeff.S,
Yeh, I realise that the defaults will drop off 6 yrs after the default date but as another thread suggested, if the creditors are submitting defaults right up to the the month before an IVA finishes, will that take a further six yrs to come off from that month/date?

If I'm correct I think by reading the guidelines that its says that they will drop off six yrs from the date that the default FIRST started not when they last submitted a default with ref to that particular account, maybe an expert will confirm what I am saying please.

Also do 'good' reports clear as well, I have a 'full' account with the co-op (no credit card or overdraft but a visa debit card) and they are reporting 'ok' each month, if they don't drop off it could be a bonus/start for when my IVA/Credit rating does finish....

The 6 years starts from when the account was defaulted.

A default is whats called a final status and is seen as an end to an agreement.

ANY item that is current ie bank accounts or loans (ie car loans) that are either being paid or not as the case may be will continue to reported throughout the life of the agreement(unless defaulted).

Thanks for confirming that Storm.....

As someone who has just finished an IVA, you will always have the defaults against a debt until you complete your IVA and only then will they be removed once YOU send the completion Certificate to them.

Thats when the fun starts!!