How much will my credit rating go up or down? That is a very common question. But it’s often tricky to answer!
This article has some guideline numbers from Experian that may help.
These are only indications – your credit score may not go up or down by this much.
They assume nothing else has changed on your record. They also apply to single issues. If you have two defaults already, getting a third won’t be as bad … And if one of your three defaults then drops off after six years, your score won’t improve as much because there are still two remaining.
If your main concern is wanting to get credit at a good interest rate, what matters is how each lender will assess your credit history. Lenders don’t actually use the calculated credit scores! So I’ve added some notes about how lenders tend to think about these situations.
Contents
How balances & credit utilisation affects your credit score
“Credit utilisation” shows how much of the credit limit that you are using at the moment. If you have a limit of £5,000 on a credit card, your utilisation would be 20% if your balance is £1,000 and 80% with a balance of £4,000.
Credit scoring gives you extra points if you are using a low amount and deducts points if you have a high utilisation. All the numbers in this article are from Experian:
- if your balance is under 30% of your limit, you gain 90 points.
- a very low balance is even better – less than £50 or zero will gain an extra 60 points – so that’s the boost you get if you clear your balance each month.
- using over 90% of your limit loses you 50 points.
- a very high balance of over £15,000 will lose an extra 50 points.
The size of the limit itself also affects your score, but not by as much:
- A high limit of over £5,000 adds 20 points to your score
- A very low limit of less than £250 loses 40 points.
Is it the utilisation for each card or overall that matters?
It’s both! So getting the utilisation for one card below 90% – or even down to zero – won’t have major effect on your credit score if you have large balances and over 90% utilisation on your other cards.
Do overdrafts count in this calculation?
No, Experian doesn’t include overdrafts. But the amount you are using of your overdraft is counted as part of your total unsecured credit.
What do lenders think about credit utilisation?
Most lenders don’t like you to have maxed out your credit cards, it suggests that you are struggling, so why would they want to lend you more? Do some lenders prefer you to have a balance, not clear your card each month? That may be an urban myth…
Lenders usually have an extra piece of information here that doesn’t show on your credit record – your income, because you will typically have been asked for this on your application.
If you have one credit card with a low limit and you are using most of it but your income is high, you can probably get car finance at a good price. But if you have borrowed a lot compared to your income you are going to struggle to get offered more credit at a good rate.
The effect of missed payments, defaults & CCJs
- A missed payment on a bill or debt would lose you at least 80 points.
- A default is much worse, costing your score about 350 points.
- A CCJ will lose you about 250 points. (For many CCJs, there will already be a debt with a default on your record, in this case a CCJ then increases the harm to your credit record, but not by as much as 250 points.)
It doesn’t matter how large the size of the problem debt is. A £25 mobile bill has the same effect as not being able to make the repayments on a loan of ten thousand pounds.
These problems are seen as less serious if they are older. Once a default is more than two years old, the negative effect falls to 250 points, then when it is over 4 years old it drops a bit more to 200 points.
These hits to your credit rating aren’t reduced when you start to pay the debt, or even when it has been fully repaid. (There is one exception here – a CCJ is deleted completely if you pay it in CCJ in full within a month of the judgment.)
What do lenders think about defaults?
Lenders vary a lot in their attitude towards defaults:
- high-cost lenders such as payday loans and guarantor loans won’t automatically reject your application if you had a default a couple of years ago, even if it hasn’t been repaid – they are targeting people with bad credit;
- you may be rejected by some best-buy balance transfer deals if you have any defaults or missed payments, even if these are old and repaid;
- some mortgage lenders will reject people with any defaults, repaid or not, but others may offer a reasonable rate of interest if your defaults are old and they have been settled for a while.
Four small wins
Once you have big problems on your credit record such as defaults or CCJs or an IVA, only time will get rid of those “black marks”. You can’t speed this up and often the key thing is to stop any new problems being added.
But here are some small ways to boost your credit score:
- Stop applying for credit! Not making any credit applications for 6 months adds 50 points to your score.
- Keep a credit card for more than five years. This adds 20 points to your score. But if you are trying to decide which card to close, always keep a card with a lower interest rate – that’s more important than 20 points on your credit score.
- Register to vote. It’s a simple way of adding 50 points to your score.
- Pay for car insurance in monthly installments. This can increase your score by 20 points. But do check what your insurer charges. Many people are paying over 20% interest to pay monthly, with a few firms charging over 50% so this can be incredibly expensive!
There is also Experian’s Boost facility. That can add up to 66 points to your Experian Credit Score – but it isn’t clear how many lenders will actually use this new Boost data.
Four things that DON’T affect your credit score – are you surprised?
- checking your credit score – this doesn’t affect your credit score and lenders can’t see that you have done this either.
- paying off a debt that has defaulted. Most people don’t believe this, but it’s true… your credit score only looks at what has gone wrong in the past, not how you are trying to put it right. But of course, repaying the debt prevents any chance of getting a CCJ, which would mess up your credit score for another six years… See Will paying a default improve my credit rating? for details.
- Someone else at your address having bad credit. You are only financially linked to someone you have a joint loan, mortgage or current account. If you aren’t, it doesn’t matter how many letters from debt collectors arrive if they aren’t for you. Have a look at your credit reports – those problem debts won’t be showing.
- From summer 2022, BNPL data such as Klarna purchases will start to be shown on some credit reports. However these will be ignored when calculating your credit score. Even when you miss a payment and a lender such as Klarna adds a late fee, this will still not affect your credit score – but as the missed payments will show on your credit record other lenders may decide not to give you credit.
Equifax and TransUnion – the other two credit reference agencies
This article has been all about Experian’s credit score calculations.
Equifax and TransUnion are the other two major credit reference agencies in Britain. They have broadly the same approach as Experian, but their credit scores have a different maximum (if you think this is bonkers, I agree!):
- Experian’s maximum score is 999
- Equifax’s maximum score is 1000 (it used to be 700 – it was changed in 2021.)
- TransUnion’s maximum score is 710.
So a change to your score for any particular factor is going to be smaller on TransUnion than Experian. And a 500 score on Equifax is poor but it’s good if you are looking at a Clearscore report!
The major lenders like the big banks report to all three credit reference agencies. But smaller lenders may only report to one or two. So you may find that your scores and reports are very different on different reports.
If you are worried about your credit score you should check all three credit reference agencies. Luckily you can do this for free, see The best ways to check your credit score.
Improve your credit score for a mortgage
How to use a credit builder card
What should the default date be?
Lloyd Pritchard says
Hello. Recently I have moved address. I was notified by my old address that I would be removed from their electoral register. This prompted me to register at my new address. I believe there has been a gap of about a month. During this period both my credit and debit card have disappeared from my credit report. Will they reappear when my electoral register address is updated? I have already changed my bank address to the new address. Thank you.
Sara (Debt Camel) says
At a guess, it’s more likely your bank hasn’t yet notified your new address.
Alan says
Hi
I had a lot of defaults from 2013, most of which have dropped off my credit report. I final default is coming off around January next year. I have a couple of credit cards and a loan I have just paid off. My credit score is slowly going out. Once this final default is removed, should I see a significant improvement in my credit score?
Sara (Debt Camel) says
Probably! But are there any missed payments or payment arrangements showing? And your credit cards, is your balance using a lit of the credit limit?
Alan says
Once this default is removed I have no late payments or any issues with any credit accounts. Everything else is up to date with no missed payments and I have high credit limits and are well within them. My Experian score is only 658 out of 999 – poor. I read that a default deducts 300 points which is reduced to 250 after 2 years and 200 after 4 years. Based on this, does my score go up by 200 when its removed?
Sara (Debt Camel) says
It should be something like that! Come back and say what actually happened… It is going to help your score if you can get the credit balances down to under 30% of your credit limit, as the article above says
Alan says
Hi
Just to let you know that my final default has been removed and my score increased by 120 points.
Thanks
Libby says
Hi,
I have 2 accounts with debt collectors which I have been paying on time. However, on my credit report, it says defaulted, and every month says I’ve defaulted on it. 23 defaults in 2 years, but I’m paying on time. This is making my score worse when I’m trying to improve it. Is this right?
Sara (Debt Camel) says
I know this looks dreadful, but it’s the way credit records work. Only the first default is taken into account when calculating a credit score.
EJ says
Hello Sara,
Firstly, what a great website – very helpful and informative.
I have kept the below wording to a minimum so that it fits within the comment section’s maximum character limit:
• In mid to late 2014 I had a number of late payments across a number of different credit cards
• These late payments were registered as between 3 to 5 months’ late with the CRA’s
• The accounts were brought up to date before the end of 2014 – no account was defaulted
• I continued to use the cards normally and with no issues until mid-2016, when I paid off and closed the majority of the them
• These late payments will still show with the CRA’s until 2022
• I am applying for a mortgage in July 2021 – my last payment issue will therefore be 7yrs prior
• There are no other issues with my credit file and I have continued to obtain standard credit with regular credit providers to date and always repay it on time
In 2020 is it worth asking the credit card providers to retrospectively mark these accounts as defaulted from 2014, thereby the late payments and accounts will stop showing with the CRA’s before 2021’s mortgage application? Anecdotally, if they were not to agree, how would mortgage providers view my application and me as a borrower given the facts and timelines above?
Many thanks in advance.
Sara (Debt Camel) says
If you have had no other payments problems on your credit record since 2014, you should be able to get a mortgage at an OK rate in 2021 from a high street lender. Talk to a good mortgage broker.
Andrea says
Hi Sara, quick question.
In 2013 I ran into financial difficulties and I had a £2,000 of student free overdraft with hsbc. I couldn’t pay it back at the time and the bank closed my account and sold my dept to a dept collector. After a while I started receiving letters and early 2015 I cleared the debt. I could have done it much earlier, but I just didn’t know what to do.
Now my partner and myself have had a mortgage for two years and there was no problem at all to get one back in December 2017.( my partner had a full time contract at the time.)
Now we are both bank staff and we were just about to remortgage when our financial advisor said that the bank offering the mortgage with an excellent rate is not sure as one of us has a questionable credit report.
After doing my checks on Experia I found out that my credit score was just “fair” and still show the past activities.
What’s the chance of getting a decent deal now? Could it be that “Santander” would still offer that rate?
Kind Regards
Andrea
Sara (Debt Camel) says
Hard to say. You need to ask your IFA or a mortgage broker. You should always be able to get a fix with your current mortgage lender.
viva says
hi
Sara
my question is lower finance damage my credit file , this 2010 JJB SPORTS account, they don’t have default in my account , still they damage my account, laster year write off this account still , they damage my account, I call and complain , normaly all creditrs remove all defaldt this Lower finance damage my credit file, I am lost somuch money in this creditors, can I claim ??
thanks please advice me
Sara (Debt Camel) says
Did you repay the balance or did they write it off, if they wrote it off, why did they do this?
Joe Bloggs says
My IVA is due to drop off my report in Oct 2021. How many points should my score go up by?
Sara (Debt Camel) says
Hard to tell. Has your IVA been settled?
Have you checked all the debts in it have default dates on or before the start of your IVA – see https://debtcamel.co.uk/repair-credit-record-iva/ ?
Joe blogs says
Hi. It was settled early in 2017 and so still has to do the remainder of the 6 years before dropping off (which is Oct 2021). All defaults are on or before the start of it. There’s been none to date since.
Sara (Debt Camel) says
ok, so I suggest you get yourself a LOQBOX and save using that for the next year. You won’t be refused this because of your poor credit record and it’s set up so the monthly savings look like the repayments on a loan – see https://www.loqbox.com/en_gb/. Then when that ends, get a credit card for bad credit and use it each month and repay it full every month.
Do that and you should end up with a very good credit score in Oct 21!
general zod says
Hi Sara,
Years ago when I was young and stupid I didn’t pay a mobile phone bill due to living abroad. Now i’ve always just ignored it and my credit score isn’t to bad at the moment equi (413) and I have been told by the bank that this could effect me getting a mortgage now the past as its a default. Now its due to be removed in the next couple of month as the 6 years have passed. Will banks no longer be able to see that ive had a default in the past? So what I’m saying is have I got away with it relatively unscathed?
Sara (Debt Camel) says
A lender cannot see a default that has dropped off.
You aren’t yet out of the woods though as a debt collector may pop up threaten court action. By the time they do, it may be stateute barred, but you will have to argue that, if you ignore letters from debt collectors you may get a CCJ.
Louise Webb says
I have 2 settled defaults that are 6 years old in May 2020 and June 2020. I have 1 credit card which I pay in full every month. My credit score is currently 551 with Experian. Realistically, when is it likely that I will see an improvement to my credit score?
Sara (Debt Camel) says
If there are no other problems you haven’t mentioned, then end of June! Perhaps you could come back and say what happens?
PS dont make any new credit applications before then.
Robert says
Hi Louise,
I’d be interested to know if you have seen an improvement? I’m in a similar situation where a default is being removed in August.
Thanks
shuang chen says
HI,
I am applying for car finance just now, and I have a default amount of 2431 pounds since September of 2015, it is quite older now, can you give me a suggestion, should I pay them back immensely( but I do not have enough money), or pay monthly? is it will help for my credit score goes higher and get the better car loan? Thank you so much.
Sara (Debt Camel) says
if you pay it now your credit score won’t improve but lenders are much more likely to lend to you – they don’t only look at your credit score, they also look at your debts.
if you don’t pay it or set up a payment arrangement, you may get a CCJ which would be worse for your credit score.
best advice is
a) talk to a debt adviser such as national Debtline on 0808 808 4000 and
b) borrow as little as possible for a car as it’s going to be at a very high interest rate.
DM84 says
Hello,
I am looking for advice. I’m really down about my credit report at the moment as I had 2 defaults that came off this month but nothing has changed. I suspect its due to a loan I had where I lost my job and ended up on an arrangement to pay. I hold my hands up to 2 missed payments. I then entered an arrangement to pay which could only be set up for 3 months, I would need to contact them to discuss another arrangement to pay every 3 months. Anyway I noticed my monthly payment went up from just 1 pound to the original amount of 274 pound. I was now in work so I thought great I do not need to do anything, except they now started to report every payment as missed and not on an AR marker.
I took it the FOS but they did not see it my way and it was not upheld. I am disappointed and absolutely gutted to think that I would have had a clean record this month but instead this loan will be on my file till August 2025 as I paid it off in Aug 2019.
Is a 6 month marker on my credit report effectively a default?
If so should I ask for a default to be applied as at least it will get rid of my 6 month late markers and puts the date to April 2017 when I first became 3 months in arrears? I know its a lot to read but I feel sick at the thought of not being able to buy a house this year with a small deposit where I might need 5 times the amount I have saved. Can anyone help please?
Sara (Debt Camel) says
I took it the FOS but they did not see it my way and it was not upheld.
What were you asking FOS to do? How long ago was this?
If the only thing wrong on your credit record are an arrangement to pay on a loan that has been repaid, I am surprised your credit score hasn’t increased. What is your score? Has it changed from last month when the defaults were still there? What report are you looking at?
DM84 says
I was asking the FOS to remove the missed payments and change them to AR. They received 4 months worth of payments for 274 pounds on my payday and they all went down as missed because they say my arrangement had ended. The adjudicator agreed with the loan company so I asked the ombudsman to have a look. The ombudsman says “He has commented on more recent items which have happened subsequent to his complaint but I don’t have the business records for that period. However, I have no reason to believe it has made any subsequent errors.”
It just seemed he’d spotted one error I made so didn’t bother to check the rest.
My score with experian is 577, 280 with Clearscore and 477 with CKarma. The last default came off on the 8th January and not showing on any accounts now. Maybe it just needs more time. I am also using more than 75% on 3 credit cards of each around 1000 limits.
FOS Decison Ref is DRN4939921
Sara (Debt Camel) says
I doubt you can make another complaint about your credit record then as FOS has already looked at it.
Getting your credit card utilisation down to under 30% and then down to zero will help your credit score.
DM84 says
Thank you for responding,
I’ve been a nightmare with credit in the past but have learned from my mistakes, such a kick in the teeth when I pay everything but just fell on hard times.
I’ve tried twice going down different avenues with the FOS (Irresponsible lending) but I cant persuade them.
Could I ask if you think it would be better to ask the loan company to issue a default from 2017 or should I wait to do this in 2023 as it would wipe it off my record nearly 2 years earlier than the reported missed payments? Is this something they will even consider?
Sara (Debt Camel) says
In a few years many lenders won’t care about an arrangement to pay that has been repaid several years ago. They may care more if you get it defaulted now So perhaps wait until 2023.
Naomi says
Hi, I’m not a financial expert but I might be able to reassure some people.
My credit rating on all 3 reports is poor. I have otherwise healthy financial habits, (credit cards under £2k, no payment plans or loans) but have an active default from 2016 (I was renting at the time and had a mix up with a gas bill. The amount was small – which makes it more frustrating, but a default is a default regardless of amount).
Anyway, this year I purchased a home, on my own (no partner or help from parents) with just 5% deposit on a £100k flat. (if you live in London, consider moving. There’s cities out there just as nice). It’s not a mansion but it’s a first step – with a normal mortgage (not a special ‘bad debt’ mortgage), from a high street provider. My rate is a little higher than my friends (around 3%) but the £400pm mortgage I pay is much less than my previous rental payments, so I am now able to put more towards the credit card or savings to upsize in future years.
So even if your report isn’t where you want it to be, it might still be possible sooner than you think! Good luck :-)
Sara (Debt Camel) says
Thanks for the info! You say this default was “active” – had you repaid it? If yes, how long ago?
Naomi says
Hi Sara,
It’s active in that it’s still showing on records. It is dated Feb 2016 but I didn’t notice it until I reviewed my credit files in 2018 (in the run up to my mortgage applications). I didn’t actually repay it until Feb 2019 (the month I applied for mortgages), mainly because I was in a lengthy ombudsman dispute then about it which unfortunately ended up being pointless. I don’t think repaying made a difference in the eyes of the lenders I approached, but it was only £169.
DM84 says
Thank you Naomi,
That is very reassuring. I am only looking to purchase a house for around 70,000 so this gives me hope. I’ll probably have 7000 by the time i’m in a position to buy and will have my credit card debt under 30% or zero. I also earn over 40k a year.
Plan ahead, pay off CC debt, save as much deposit as I can and hopefully in 6 months buy the house. Will keep debtcamel informed of success or failure in 6 to 9 months. Fingers crossed.
Thanks again Sara & Naomi
Danielle says
Hi Naomi,
That is really reassuring – thank you. As I am in a similar position.
Could you please confirm who your mortgage is with?
Thanks,
Danielle
Naomi says
I went with Principality building society, simply because they accepted my 5% deposit (this might be a Wales only incentive but deffo worth checking). I also got offers in principle from Santander and Natwest but they required 10% deposits. I didn’t check anyone else so there may have been others who may have accepted.
I think very few mortgage lenders actually care about our credit scores, the score is more of a guide for us than them. They will look into everything themselves – debt amounts, dates, regular repayments, recent activity, utilisation – and use actual common sense. Or, they seemed to with me anyway.
A lot of lenders have PDF guides floating around the internet of their lending criteria, these documents are meant for brokers but can be found with a good google by anyone. This will give you an idea of how strict a specific lender is. I saw a few that basically said ‘any applicant with a default would be a straight rejection’, but some others said they would take applicants with defaults ‘case by case’ or that defaults over 3/4 years would be acceptable, and so on.
Good luck!
Sara (Debt Camel) says
best advice is to go through a broker! They will know what lenders are more likely to accept you.
keats says
I have 3 credit cards, one has a balance of £0 (£3600 limit) and one has a low balance of £300 (to be paid off in full this month) (£4000 limit), my other card is currently being used to pay my other 2 cards debt and overdraft off so has £4900 balance (£9500 limit – recently upped by the company from £5500). Over the last 2/3 years I’ve been working hard on trying to create a decent credit score so when I apply for a mortgage I will be in the best place possible to do this. I have no real savings yet so any mortgage application is a little way away yet. I have kept 3 cards open so my total credit utilisation is below 30% with the view that I will close one (the £3600 one) of them when the total balance of these becomes less than 30% for the 2 remaining cards and then the £9500 one once the debt has been cleared. As a boost to my score is it worth a)increasing my £4000 card to £5000 limit so I get the high limit boost (this will be the only card I have when I’ve paid the other one off) – this is my oldest card and has a low % on transactions and b) for now should I buy some petrol and pay it off in full each month? Will doing this impact the score in a positive way or will it make no difference
Sara (Debt Camel) says
You are obsessing too much about your score. That isn’t that important for a mortgage, what matters most is no credit record problems and low debts and a good deposit.
Are you paying interest on the 4900 balance card?
keats says
Hi Sara, thanks for responding – no current interest on the 4900 card and i aim to pay this off before any interest kicks in.
Sara (Debt Camel) says
Great. That and clearing your overdraft are what matters.
Don says
Hi,
I’m after some advice, basically I was ill advised to agree to an IVA that was approved in February 2014 (so approaching 6 years). The reason I was ill advised is that my house was up for sale as my partner and I had broken up and he wouldn’t pay anything towards any bills etc so I sought advice to get me through until the house sale went through which was a few months later. When the house was sold, the Insolvency Practioner paid the creditors with my half of the sale proceeds and I was then sent the remaining proceeds. At this point the IVA was completed in August 2016. I obviously had a number of missed payments, but no defaults or anything else leading up to the point when the IVA was approved. I have two credit cards which I’ve had with zero balances from before the IVA, plus I was able to get a mortgage which I’ve never missed a payment for. My credit rating is basically Fair across the board with the credit reference agencies and I could get credit if wanted I think, but my question really is what the likely impact to my credit file of passing the six year mark of the IVA being approved and it being wiped from my credit file. I’d like to remortgage for a better rate and bring down the term if possible, but obviously wanted to wait until I could get the best interest rate. Any advice would be greatly appreciated!
Sara (Debt Camel) says
An IVA in your situation was a very bad idea :(
Once the IVA goes from your record, your credit score should be good. Probably great if you are using those old credit cards and repaying them in full each month. If you aren’t doing this, you should, after 6 months your score should be very good.
from the point of view of a re=mortgage, you will always have to answer Yes to a question asking if you have had an IVA or ever been insolvent. But many lenders won’t care, especially as all your debts were repaid in full. but do go through a broker, not direct to a lender.
Christopher says
Hi there,
I recently returned from living abroad so have started with a credit rating of 0. I have managed to get this up to 178 in a few months and have recently got 3 credit cards with low limits which as of this month have all been paid in full. Realistically if I pay everything off in full every month how long will it be to get my rating up to a good enough level to get a decent car loan or lease? 3 months from now maybe?
Thanks in Advance
Sara (Debt Camel) says
At least 6. Getting three new lots of credit was a mistake, 1 or 2 would have been better.
Naomi says
Hi,
I recently discovered a CCJ (whilst applying for a mortgage) that I had no idea existed. It was for a parking ticket in January 2018 that I didn’t know I had, and all of the letters RE it went to an address I had moved out of a week earlier, so I never got them. I have applied to have the CCJ set aside and have a court hearing in 2 weeks for this. My question is…if I’m successful, how quickly will the CCJ be taken off my credit history? And if I am successful, will this have any kind of negative affect on my score? Thanks
Sara (Debt Camel) says
I don’t know how long it takes to update your credit records. The CCJ should be removed, there is no underlying debt on your credit record so it should go without trace.
You will then have to pay the parking ticket or fight a new court case.
Good luck with the hearing.
Naomi says
Hi,
Thanks for replying so quickly. Presumably the original fine owed will still show on my record until I pay it/fight it?
Sara (Debt Camel) says
I doubt you can see the original fine on your credit record – normally only the CCJ shows. Have you looked?
Naomi says
I haven’t recently – I will. But to be fair I don’t recall seeing it, because otherwise I would have known what the CCJ was for….I had no idea! Do you have any idea how likely it is that the judge will set it aside if I can prove I didn’t live at the address they sent the letters to?
Thanks
Sara (Debt Camel) says
Sorry, I don’t comment on court cases, you can talk to National Debtline on 0808 808 4000 or post on the Legal Beagles forum (https://legalbeagles.info/forums/forum/legal-forums/court-claims-and-issues) if you want.
Lee says
Hi ya
A few years ago I entered a DMP with stepchange you helped me a lot, however my understanding was they would agreed with the creditors a repayment plan. They did this however 5 of the creditors have marked the accounts as default which has massively affected my credit score. I am wondering if there is anyway of having these removed or status changed as I believed they would not be set as default as a repayment plan was agreed. All debts are paid off and cleared now and my plan finished with stepchange in January 2019. But now looking at mortgages but have another 2.5 years until the defaults fall off the report.
Edward goddard says
Hello,
I have recently won a affordability claim against Bamboo loans. In that loan I have defaulted. As I won a claim could I ask that the defaults get removed from my credit rating?
Many Thanks
Edward
David Johnston says
I have had a satisfied ccj on my credit report since October 2014 and it’s due to drop off my report this October will it make much difference in my score once it comes off
Sara (Debt Camel) says
Yes it will! Unless there are a lot of other problems on your credit record there should be a big improvement. Could you come back and say how much it does change?
Phil says
Hello,
I have a default on my credit file, which has affected by credit score possibly by around 300 points.
Is this 300 point deduction for a default final. I had a score where I managed to start doing everything right and my score increased from poor to fair. By the end of the year they took a chunk of points off because of this default, thereby by preventing me from having a fair score instead of poor score. It seemed as if they took 300 points off when the default was added, but took more points off at the end of the year for the same default, effectively hammering me for 100s of points. This happened at the end of every year until about year 3/4. Can the reference agency do this? I have researched and it mentions they can only reduce your score by a set amount, and further late payments or non-payments will not adversely effect the score anymore, and at the same time, paying it off doesn’t improve the score either.
Sara (Debt Camel) says
One default only has one effect on your credit score.
What else was happening on your credit record, were you applying for new credit? Using a lot of your credit card limits?
Phil says
Hi Sara,
I just remember my credit score going up by 40-80 points before Christmas, because I was paying bills on-time and keeping within 30% of my available credits, and then January it went down by some 120 points due to something. I never applied for credit, that is why I assumed they took 120points or so off because I was in the fair category, which I didn’t think they allowed if you had a default.
Does that mean that I can increase my score to ‘fair’ or higher if I continue to do everything right? They can’t arbitrarily take more points off due to an existing default?
Sara (Debt Camel) says
“I assumed they took 120points or so off because I was in the fair category”
no – you don’t get points deducted because you are in a low category – you are in a low category because of the details of how you have handled credit.
Something else will have happened in January to cause your score to fall.
Does that mean that I can increase my score to ‘fair’ or higher if I continue to do everything right?
With a default it isn’t going to get much better than fair.
They can’t arbitrarily take more points off due to an existing default?
no. in fact as a default gets older, it has a bit less effect as the article above explains.
Katie says
I had a CCJ around July 2014 and paid it off the next year. Do you know how much my credit score will go up by when it falls off?
Thanks
Sara (Debt Camel) says
The article above says what a CCJ can take off your Experian credit score. But it depends a lot on how bad the rest of your credit record is. Can you come back on report on the change that you see?
Rachel says
All of my ccj are 6 years old and will drop off between june and October 2020 except for one default to drop off next year Jan 2021.
I do have a 4yrs old settled ccj which will drop off in 2022. My credit card utilisation is 25% with limit of £3500.
After all the these defaults drop off this year, will my credit be able to jump from fair to good despite my remaining settled ccj and healthy financial record( no new default, no late payments no new applications) ?
I am trying to understand if settled ccj or just one default that is more than 4 years ago can deter some from moving from fair to good credit rating or not?
Thanks
Sara (Debt Camel) says
your credit score may not get to Good with a CCJ on it even if it has been settled.
To give it the best chance, you want that credit card balance down to zero so you can set up the card to be repaid in full every month. That maximises your credit score.
Rachel says
Thanks for the prompt response. I intend paying off the £500 balance on my credit card with £3500 next month and I do not intend to spend anything more out of it and my financials will remain clean.
All my defaults are 6 years old and will drop off by october, I will have zero balance credit card with just the 4years old settled ccj .
With clean financial habit and just the ccj left is there anyway to move up from fair to good? Should I take another credit card to help push me up or just wait for the settled ccj to drop off in 2 years before I can get to move up from fair to good score?
Just looking for how best to climb from fair to good minding all my efforts in clearing up my debts with defaults dropped off.
Thanks
Sara (Debt Camel) says
taking out another credit card won’t help at all, only time does until the CCJ goes. Is there some particular reason you want a better credit rating?
Once your credit card is down to zero, the best thing for your credit score is to use it once a month eg for a tank of petrol or one weeks food shop, and set up the car to repay in full automatically.
jay says
I am in exactly the same position as Rachel. the only negative on my report is a CCJ from 2016. it was settled in 2018. I am the lower end of fair. my credit utilisation is 37%. will my score go up if I get the credit utilisation to less 0-10% or is it likely to stay roughly the same due to my CCJ?
I want a better credit rating to apply for a car finance. I know there is some finance that will accept me but I want a better deal.
Sara (Debt Camel) says
Yes there is a boost to your score from repaying your cards in full every month, as the article above says. How large the effect will be will depend on what else is on your credit record.
Your score may also go up when the CCJ gets to be 4 years old.
BUT lenders do not look at this headline credit score – they have their own metrics. Even if your credit score doesn’t change at all, lenders may be more prepared to lend when your current credit balances are lower as it improves the loan “affordability”.
There is talk that the second hand car market prices may drop a lot in the next 6 months because of Cornavirus… may be worth waiting a while.
Craig says
Hi there.
Basically my credit history is far from great.
I have 4 defaults , 3 over 4 years old and one that is 2 years old. And I have a 4 late balances. I’m now in a place where I can clear all these debts within the next 2 months. Question is , should i pay the late payment balances first then pay the defaults?
I’m trying to lease a pickup for work , the sooner i can the better as my current vehicle is getting around 20mpg and I’m driving upto 700 miles per week for work as it stands will getting current payments back on track help more in the short term? Also there is no interest occurring on the defaults.
Sara (Debt Camel) says
I think you should clear the late payments first to prevent them becoming defaults. It won’t make much difference to your credit score now, but in 4 years time doing this will mean all the defaults have gone from your credit record.
How large are the defaulted debts? I don’t know anything about leasing pick-up trucks, but it’s hard to lease a car with a bad credit rating.
Craig says
They are as follows : £56 , £95, £155 and £1564.
Sara (Debt Camel) says
ok if they were a lot larger I was going to say maybe better to use the money for the truck and keep on repaying the debts slowly as they arent having any interest added.
chris says
hello
I have recently cleared all my debts (end of January) on my credit file 1 CCJ and many others my transunion credit score was down to 355 now it stands at 538 with Equifax 237 and Experian 483, I have kept 1 credit card which I pay off every month, and I also have a small overdraft of £500 but do not always use it. my question is will my credit score keep improving every month as it seems to now go up 13 points a month. My CCJ is paid obviously its not coming off until 2023. I have also registered on the electoral role. will my credit score keep going up or will it stop at some point??
Sara (Debt Camel) says
Apart from the CCJ, do you also have defaults and missed payments? Are they all before the date of the CCJ?
Darren says
Hi sara. Just wondering ive got a ccj thats 5years old its for 916 pounds. Every think else is fine. My credit score is 723 with experian. Ive got a 10persent deposit for a morgage. Do you think this will effect me. Thanks
Sara (Debt Camel) says
When did you repay the CCJ?
Darren says
Hi sara. I havent repayed the ccj. Is this worth doing as it drops off next year but i have seen a house i like
Sara (Debt Camel) says
You have no chance of getting a mortgage at anything but a dreadful rate if you have an unpaid CCJ. Even with a paid CCJ it may be very hard.
And the whole mortgage market has seized up anyway… with only a 10% deposit you won’t even get an offer until we are past the worst of this coronavirus.
You need to talk to a mortgage broker about your options.
Darren says
Ok thanks for your help
Philip says
Hi,
I have recently renewed my car insurance with the same company as last year. Last year it wasn’t added to my credit file but this year they have added it to my credit file, which has affected my score by -40 points. Is this allowed? I have never had car insurance where it was added to my credit file and where it affected my credit score.
Sara (Debt Camel) says
Yes they can do this – and a lot of insurance companies now do. This dip should just be temporary – taking out any new credit affects your credit score. But after the first few months payments, this new entry should actually help your credit score.
Philip says
Hi Sara,
If I cancel my renewal within the 14 day cancellation period, will the credit account be deleted from my Credit file? Because I essentially decided against the account, so there should be no account to add to my file.
Sara (Debt Camel) says
I don’t know, it may depend on whether the car was actually insured during this time. I suggest you talk to the insurer and ask.
Ed says
Hi Sara,
I have 2 defaults, both fully paid. One ‘drops off’ on 7/6/20, the other-October 2021. Will the one ‘dropping off’ in June alter my credit scores?
Sara (Debt Camel) says
yes it should, but not by as much as the numbers in the article above suggest. Could you come back here and say what does happen?
Ed says
Hi Sara,
Yes, of course.
Ed
Pr says
Hi
I have 3 defaults in my name, one from years ago which should surely be dropping off soon and two from the last 12-18 months. I am paying them fully along with any other credit card amounts I have.
Will defaults affect a financial check by an employer? Are they seen as serious as a CCJ/bankruptcy/IVA?
Thanks
Sara (Debt Camel) says
Defaults are usually seen as a lot less serious than CCJ/bankruptcy/CCJ.
Dr says
Will these be seen on a financial screening/credit check. I have been with this employer for a few years but it is a case of depending if I am working from home.
What else will be shown, credit score? Hard searches? Previously loan history?
Will this be shown on a financial screening check or only a full credit check also?
Is it plausible that nowadays my employer would only perform a public screening check if although I work in the financial industry, my employer is a contracting recruiter and is performing this externally?
Sara (Debt Camel) says
I can’t say what any particular employer will want to check. In general people are more worried about this than they need to be.
Mim says
Hi
I have a CCJ due to fall off in Aug 2020, for £550+ currently unsatisfied. I want to know if paying in full prior to CCJ falling off would have impact, or can/should I remain paying. If I continue repaying it would fall to around £200 in Aug, when 6 years are up.
My score as of today on CC is 519, CS is 375 and Experian is 618.
I have 3 cc, one with £950 limit with balance of £580, £2250 with balance of £1400 and a balance transfer card which I’ll move the previous £1400 over onto to clear during interest free period of 6m. I intend to clear these debts by end of year reducing balance to 0.
I have an arranged overdraft of £2000 on my graduate bank account, that my salary falls into each month and is used as my main account for debits/credits. Should I aim to clear this overdraft as it is a persistent debt, that does cost me around £400 a year in interest and charged for having. If I clear this £2000 and remove the overdraft facility entirely will it boost my score.
I have a few late payment on one credit card from 2019, when I had to set up an AP but I’m up-to-date on all my payments, and haven’t been late. If I keep this up when can I expect to see my scores across the board improve. I am intending to purchase a house in the next 3-4 years, and deposit wise thankfully I’m not too worried, but it is my score that I feel will let me down.
Sara (Debt Camel) says
are you currently making any payments to this CCJ?
You should aim to clear the overdraft. You don’t have to cancel it, an overdraftt you are not using is not a problem.
The payment arrangement on a credit card – have you now cleared that balance?
Mim says
Yes, currently paying £5 per month towards the CCJ so still unsatisfied, as it is due to fall off in 4/5 months time, doesn’t make sense to clear the full balance? Am I correct in my thinking?!
I was unable to meet my minimum payment on that card, so it was in a payment arrangement for around 6 months, which was flagged on my credit report. This card is now up to date, but the balance isn’t paid in full though I am paying more than the minimum each month in order to clear the balance.
Sara (Debt Camel) says
Even though it will drop off your credit record, unless you want to deal with bailiffs or have it deducted from your wages, you need to keep paying. And it will need to have been cleared at least. 6 months before a mortgage application so the payments don’t show on your credit record.
A says
Hi Sara,
I had such a bad time in 2017 and ended up with around 6 defaulted accounts.
My credit score is the lowest it can be on 96.
I read somewhere that even with defaults after I think 3 years your score will improve a little and so on.
Is this true? I don’t know what to do to improve this score. I can get no credit at all to Improve the score. I need to rent a house this year as I will have nowhere to live but I’m scared I will be rejected to rent because of this.
Xx
Sara (Debt Camel) says
Are you repaying the defaulted debts? What sort of debts are they, loans, catalogues?
Do you have any spare income at all?
Old defaults matter a bit less, but with 6 defaults your credit score is always going to be bad.
A says
They were payday loans. I couldn’t afford to pay them at once so I had multiple defaults from the same company for different loans.
I paid them all back now I just have one left that I am paying.
I just feel so low now. Knowing these things that happened when I was in my early 20s is going to effect me forever is more than I can bare sometimes.
X
Sara (Debt Camel) says
Well done for escaping from the payday loan trap!
I suggest you read https://debtcamel.co.uk/payday-loan-refunds/ and send them affordability complaints.
If you win a complaint, you will get back any interest you paid but also any negative marks will be deleted from your credit record.
Sara (Debt Camel) says
It also not forever. Defaults drop off after 6 years.
If you really have some spare money each month, you could look at a monthly saving plan from LOQBOX. See https://debtcamel.co.uk/loqbox/. You don’t get any interest on your savings but it set up as though you are repaying a debt, so it helps your credit score. By itself it won’t make a huge difference but baby steps in the right direction.
A says
Thank you, that’s made me feel a little better. So after six years will my credit report go up significantly? Xxx
Sara (Debt Camel) says
6 years after the default date, a debt drops off. It’s a long while but not a life sentence!
Connor says
Hi,
Im a student just finishing my degree and I pay my rent per term, unfortunately my estate agents mistakenly charged me twice for a term rent repayment, obviously this payment has not gone through because I was unaware of the transaction. I contacted the estate agents and they cancelled the payment from being attempted again but will this affect my credit score? If so how should I proceed to rectify this?
Many thanks,
Connor
Sara (Debt Camel) says
a rent repayment isn’t usually on your credit record, but why not look and see?
Jay says
Hi,
I had an issue with a bank in 2016 that screwed up my business and left me in debt. My creditors (5 of them) all defaulted except one who has been adding missed payments every month even though I have been paying them all back albeit lower amounts.
My credit score obviously took a hit back in 2017 when they added the defaults and I’ve been looking at why my credit score hasn’t been improving. Guessing it’s because of the missed payments?
The creditor has offered to back date a default and remove the missed payments however they said it would negatively impact my credit score, whereas my Debt Management Agency and advice I’ve found online say the opposite. Would one more default back in 2017 do more damage than possibly 5 years of missed payments?
Sara (Debt Camel) says
Your credit score won’t improve much until 2023 when the defaults go whatever you do
Getting the missed payments replaced by a default won’t help up until that point, indeed there could be a small negative effect – but with 5 defaults already on there, 1 more doesn’t make much difference at all.
But switching to another default means your credit score will be clean from 2023. If you don’t switch. all the defaults go but the missed payments will remain until 6 years after you have repaid the debt. So getting the default added is a good idea.
Roxanne says
What can I do to improve my credit score…. currently 413 with experian. I need it to be closer to the 500 mark. I have 1 CCJ that is unsatisfied and ‘drops off’ in Oct 2021. I paid all cc and any defaults off the end of 2019. What else could I do to improve my score. I have no credit in my name. I have been on the electoral roll for 5 years at my current property. Thanks
Sara (Debt Camel) says
what is special about a score of 500?
do you still have a credit card you aren’t using?
could you afford to save an amount every month/
roxanne says
I’ve been told by a morgage advisor that I can get a morgage from someone if my score is 479 or more. I cancelled all my cc. I save every month towards a morgage but this amount varies each month.
Sara (Debt Camel) says
I suggest you plan on getting a mortgage after October next year when the CCJ has gone. Before that any mortgage would be at a horrible rate of interest.
roxanne says
so is there no way of increasing my score?
Thanks
Sara (Debt Camel) says
Not in the short term. It will improve a bit when the defaults drop off. Applying for any credit such as bad credit builder cards now will actually harm your score for a few months.
olivia says
Hi there,
I have a bit of a hypothetical.. I’m 24 I’ve had a credit card since 18, I have never missed any payment on any bill, rent, car loan or phone loan. Currently I have a loan for my phone that currently stands at £291, a credit card that I pay off every month to zero and a mortgage. Now I want to upgrade my phone, which with the current plan I have means applying for a new credit agreement and if i get a approved instead of paying £24 off a total loan of £291 I’ll be paying £30 an month on a £900 loan.. for 2 years, 0% interest. Now normally that wouldn’t bother me and my credit score is 976 on Experian but…. I need a substantial personal loan in August (to pay for major works on my house) to the tune of around £20,000 probably and I’m worried if I go for this phone deal and because it’s a larger loan amount than before that itll shoot my chances of being accepted for a loan… would it ruin my chances that much? I dont really know how it works..
Thanks :)
Sara (Debt Camel) says
20k is a large loan so the lender will want to look at how affordable it is. If you are worried, why not just leave the upgrade until after August?
Chloe B says
Hello,
I’d really appreciate some advice on a couple of things on my credit file.
I had am account which defaulted, and is only credit file as a default, this default then turned into a CCJ which I have no satisfied. The CCJ shoets up on my file as satisfied, however the original default doesn’t? Is this affecting my credit score and if so should it really be down as satisfied; as it has been satisfied!
Also, I have a defaulted loan. I have recently set up a payment plan to pay this off, however it is due to drop off my credit file in 2023, if i stick to this payment plan, I won’t have actually paid it off until 2024. If my credit file doesn’t show I’m paying this off, and me paying it off didn’t improve my credit score, wouldn’t it actually just be ony my best interests to not pay it and wait till it drops off?
Sorry for the essay i just struggle to get my head round it all!
Thanks!
Sara (Debt Camel) says
The debt underlying the CCJ should be marked as satisfied. It won’t improve your credit scored, but it may make a few lenders more likely to lend to you. Complain to the creditor and ask them to correct it.
If you stop making payments to the defaulted debt the creditor may go for a CCJ and that is your credit record wrecked for another six years. S
Richie says
Hi Sara, on 28th January 2019 I posted a message regarding credit scores at the end of an IVA. You asked my to come back and update once my IVA marker was removed….
Well, my completion certificate arrived 8 weeks after my final payment, and was marked as “Satisfied” on the Insolvency Register just a few days later. It has now disappeared from the credit agency searches, and the new scores are below – all described as “Excellent”
My credit scores Jan 2020 were:
Karma = 573
Clearscore = 345
Experian = 876
My credit scores today are:
Karma = 646
Clearscore = 484
Experian = 997
Good luck to anyone currently in an IVA. It does come to an end eventually 👍
Sara (Debt Camel) says
thanks for sharing that!
Rob says
Hi Sara,
First of all what a great informative website!
I have one settled default on my account which drops off (6yrs) in August 2020, I settled the debt about three year ago. I clear my credit card balance every month and kept up to date with my phone bill but my Experian credit report is only 711 (fair). I have saved up a £45k deposit and was really hoping to get a mortgage this year but obviously worried about my credit score and doing more damage with a failed mortgage application. I’m going to hold out until my default drops away.
Is my credit score likely to increase fairly quickly after my default drops off?
Thanks
Sara (Debt Camel) says
If that is the only problem on your credit record, yes, it should improve instantly. If you went to a broker, you could probably get a mortgage now at an OK rate from a high street lender if that is a 10% deposit? Because the default was settled so long ago. But August is pretty close and the whole house market is a mess at the moment, so waiting another few months may be a good idea.
Anna says
Hi
I have 3 defaults on my account that will drop off
27th May 2020
30th May 2020
November 2020
CCJ
2015
2018
My score is fair at the moment, my husband score is good with no CCJ or defaults
We have 25% deposit for the house which is 300k
Would we be accepted for mortgage?
Sara (Debt Camel) says
You have CCJs in 2015 and 2018?
Have you settled the CCJs?
Have you settled the defaults – how long ago?
Anna says
I’ve settled one default but no CCJ
Default that was settled will drop off in November 2020 and was settled January 2019
Sara (Debt Camel) says
You have no chance of getting a mortgage with two unsatisfied CCJs!
And it will be difficult unless the other defaults are settled too, even if they have dropped off your credit record unless you think the debts are unenforceable.
Rachel says
Hi,
Within the last 10 years I had ran up quite a significant about of debt. As I had ill health, mental health problems and caring for my terminally ill mother I defaulted on so many of the accounts and got myself in a right mess. However in June 2019 I came into money from my mother’s estate and paid all accounts. Offering some a settlement to close the accounts and have been doing what I can to try and start to build my credit score. I have taken out a loqbox which will be completed in July and have not taken out anymore debt. I had been using clearscore which was telling me all the balances were paid. I then thought to check Experian… on there it says that I have a debt with Avon for £80 from 2017 and had been served a default notice. I have had no contact with them since I last used the account which I believe was Jan 2017. So was not aware of the default notice. I tried to log into my old online account but that had closed. I also went on their website to find a collections account number to call but haven’t been able to find anything. I’m wondering is it worth my time to write to them and find out what’s going on for the sake of £80?
Also I logged into Experian today and after agreeing that a soft search for a credit card (after being told the way to better my credit score is to take out a new credit card) had taken place my score dropped by 67 points which I wasn’t happy about. I thought that the searches would not affect my rating?
Sara (Debt Camel) says
I think you do need to try to resolve this Avon debt – otherwise later you may find it is sold to s debt collector and they go to court for a CCJ. That does happen for £80. I suggest you email them at uk.contact@avon.com and say you have found a credit record entry, you have no knowledge of owing them any money, you haven’t used them for years and they have not contacted you about this and ask them to delete the record. Then see what they come back with – if they do come back with something that suggests you do owe them money, they will say how you can pay it.
When do the defaults drop off your credit record?
Kika says
I have 6 defaults and 5 of them finish by Oct 2020 and the last being may 2021. Firstly will my credit score Improve it’s currently 647 with experia so it’s possible for me to get a mortgage or will I have to wait until 2021???
Sara (Debt Camel) says
Have the defaults all been repaid? If yes, how long ago?
Kika says
Yes they was all payed in 2014
John says
Hi Sara, I have recently checked my credit file as I am looking at getting a first time buyer mortgage in the near future. I was declared bankrupt in 2014 and discharged in 2015. Accounts that were covered by the bankruptcy are still showing as defaulted and the debt is still showing as being owed. My current balance excluding mortgages is showing as £18000 when in fact it is £1300 on a £3000 limit credit card. It also shows my credit card Utilisation at 293%. Again, this is incorrect and is below 50%. These defaulted accounts fall off of my file shortly, 2 in June and 1 in July. I was wondering if it is worth getting in touch with the creditors to have the accounts marked as settled or not? If they mark them as settled now would they show on my file for 6 more years? It’s 69 months since my last payment problem so hopefully my score will improve shortly.
Kind regards
Sara (Debt Camel) says
what was the date of your bankruptcy and are ALL the defaults on or before that date?
John says
The bankruptcy was April 24th 2014. The defaults are June 16th, June 18th and July 6th 2014.
Sara (Debt Camel) says
So these will all be gone by the end of July.
If you had started this a year ago, you could have got the default dates backdated so they were all at April 24 2014 and be gone by now. But if you start this now it’s not going to be finished for a month or two anyway.
And it would be the same time to get them marked as settled.
It’s no more trouble to get the default dates corrected than to get the debts marked as settled, and getting the default date corrected is much better as the debts then disappear.
But it’s not really worth doing this now. Just wait and apply for the mortgage after the debts have gone is my suggestion.
John says
Thanks for the advice Sara,
John says
Just a quick update for anyone who has read this thread. So over the last few days I’ve kept an eye on my score/report with equifax. I have had 2 defaults fall off of my report. One for around £7800 and one around £1200. Which has dropped my credit card utilisation from nearly 300 % to 0%. Frustratingly my credit score has stayed the same. I have 1 last default to fall off of my score at the beginning of July and this is around £7000. This will put my total money owed down to £0. Fingers crossed that should see my score improve and finally get to apply for a mortgage!
Idris says
Hi Sara,
I am just asking for some advice if you can help me out please.
Me and my girlfriend are currently saving so that we can get a mortgage together.
She has excellent credit with no defaults or CCJ’s but I have really bad credit (Very Poor, according to Experian).
I currently have 5 defaults (the highest one being £7043) and the rest of them of them at lower price of no more £700. I also have 3 CCJ’s, with 2 being paid and I am just waiting for them to show as satisfied.
I have a payment plan for all of these to be paid, so within the next few months the majority of them should be satisfied including the remaining CCJ. Which should only leave at around 2 defaults remaining to be paid.
I was in quite a bad way for some time due to personal issues which had affected my personal finances.
My question now is that, because of all of these would it affect me and my partners chances of getting a mortgage, I am making regular payments and I am ensuring that I don’t miss any payments.
And is there anything else that I can do to improve my credit file.
Thanks, Idris
Sara (Debt Camel) says
what were the dates of the CCJs? of the other defaults?
Idris says
The dates of the CCJ were:
1) 27th Nov 2017 (will be paid of in the next couple months)
2) 3rd Oct 2018 (this one is paid and satisfied)
3) 27th jan 2019 (will be paid off by the end of this month, so should show as satisfied soon)
The dates of the default were:
1) 12th jan 2017 (this one is paid and satisfied)
2) 28th Mar 2018
3) 30th Mar 2018 (will be paid of soon, in the next few months) cabot
4) 16th Jun 2018
5) 1st May 2019
These are the dates of the CCJ and the default, but I have just realised that the paid CCJ and the paid default are actually the same account, surely the default should be taken of if it is now a CCJ? Is that right?
Sara (Debt Camel) says
“surely the default should be taken of if it is now a CCJ? Is that right?”
No, this is what should happen. The debt should have a default date on or before that of the CCJ, which your does.
Repaying teh CCJs and the defaults will not actually increase your credit score. the good news is that it may make some lenders more prepared to lend to you.
But the bad news is that no mortgage lender is going to consider you for a mortgage for many years as those CCJs are so recent.
I’m sorry but you need to see this as a marathon, not a sprint. Sit back, make sure NOTHING more goes wrong on your credit record, repay the debts, then start saving for a deposit.
Jordan says
I have a capital one credit card. The credit limit is low, £200. Having a low limit is affecting my credit score. Is it worth getting rid of the card because any gains I’m making by paying it off in full on time are offset by the low limit decreasing my score?
I have asked and Capital One won’t increase my limit.
Thanks
Sara (Debt Camel) says
do you have any other credit cards? other loans or debts you are repaying?
Jordan says
No credit card but a few debt to repay.
Samantha says
Hey Sara, a quick question for the past two years I’ve been working on credit score but could never seem to get it past 700, all of sudden on my Experian I am now at 966 out of no where. I made some bad choices in 2011/12/13 but they were all financially sorted by 2014. I’m worried that they’ve got the wrong person and that it isn’t my score, even though I’ve had an account with them since 2014. Any ideas
Sara (Debt Camel) says
Something bad has probably dropped off your credit record – a default or a CCJ or missed payments? If you settled a debt in 2014 which had had missed payments, then that would drop off 6 years after the settlement, ie this year.
JV says
My score has just went up 746 points aswell. I have no idea how or why but id like it to stay that way.
JV says
And today ive checked.
Its gone right back down again.
Experian are a shambles
JV says
Sara, could you please respond to this as it has really got me puzzled and i could do with some advice.
Basically my credit score has been ‘very poor’ for a long time due to defaults. On experian, last month my score was 253, and they did not have my electoral roll status on there, so i emailed them complaining. They sent a big apologetic email and refunded me £30. Today, 1st june my credit score has gone up 700 odd points into the excellent catergory, all but one of my loan history, credit cards etc have been completely wiped from the report basically showing nothing. If i go on clearscore/equifax it shows bad credit still. Where do i go with this? A strange one. Thankyou
Sara (Debt Camel) says
It sounds like an error. in which case I don’t think you go anywhere, unless you want to complain your score is too good?!? it’s likely to get put right at some point, but why spend time getting something done that won’t help you?
cyrilv says
Okay, it looks like my second (and last) default has now fallen off my record, now that 6 years have passed. At least that’s what Equifax say, and it appears Credit Karma too. But I’ve noticed no change in my score this month, and it’s not as if I’ve taken on any extra credit either. When will this expired default be reflected in my scores?
Sara (Debt Camel) says
What are your scores? Do you still have a lot of missed payments showing and high credit card utilisation?
cyrilv says
Yes, CC utilisation is high, but there are now few missed payments, last couple of years have been pretty good.
Scores are Experian 825, Equifax 341, Credit Karma 527. all unchanged from last month.
Sara (Debt Camel) says
was the default showing on your Experian record?
cyrilv says
Not sure – all i have from Experian is my score, not the full records like the other two. My Experian score has always been relatively better than my Equifax and Credit Karma ones, for what it’s worth.
Sara (Debt Camel) says
what report are you looking at?
Craig harry says
Hi sara,
I have a very poor credit rating across the board. 100% young me’s fault lol I have four 3 year old defaults and missed payments on my broadband, 2 loans and mobile. As of last week I paid off all my debt including the defaults outstanding bills and the loans and have had no missed payments since march.
I was just wondering, how long should i continue with my new money habits before applying for a credit card? As I understand this seems to be a necessary evil to help build your score.
Thanks
Sara (Debt Camel) says
There is an alternative to a bad credit card – look at LOQBOX https://www.loqbox.com/. That lets you save a regular amount each month for year and it is shown on your credit record as though the monthly savings are loan repayments. So you get the benefit of a loan being repaid on time. And you get all your money back at the end. You won’t be refused because of a bad credit rating.
cyrilv says
Looking at the latest Equifax one via ClearScore, dated today. The default that was there last month has disappeared, as they said it would a few days ago.
Also, it’s no longer on Credit Karma.
Sara (Debt Camel) says
ok, well my guess is that default was never reported to Experian. ClearScore reports can be confusing, you can sometimes be looking at an older report than the date shows. But if the default isn’t there it is odd your score hasn’t gone up a bit. I suggest having a look in another month.
cyrilv says
ok, will do. Still, at least I can take heart that the fact this final default has gone is good news in itself.
Julian says
Hi Sara,
I have read lots of your comments here, excellent advice you’re giving.
Here’s my situation. I have a wife with an excellent credit score from before we were married. We now have a joint current account that has been maintained perfectly.
I have a satisfied CCJ on my record from before I met her. That CCJ is now 4 years old so it will stay on my record for 2 more years.
My experien score is fair (802).
When the two years is up, I’d like to buy a new house with my wife so would like to spend the next two years building my credit.
My question is, is it possible for me to build my credit with a CCJ on my record? Is there anything to be gained by me getting a credit building credit card or maybe paying car insurance in installments?
Many thanks
Sara (Debt Camel) says
A credit builder card will help – make sure you use it every month and pay it off in full every month. Don’t apply for more than 1!
Also look at LOQBOX https://www.loqbox.com/en_gb/
James says
General query my newest default is 3 years old on 23rd June. I’ve read that you see improvements at the 2 and 4 year mark particularly with experian. Does anyone know if they saw any improvement at the 3 year mark? Thanks
Craig harry Sneddon says
I didn’t but I did find it easier to get credit though. It seems it’s more of a “That default is really old, so should be fine” Kind of thing rather than a noticeable score increase.
Sara (Debt Camel) says
You may be right – lenders don’t actually use the credit score that you are shown in deciding whether to lend. some lenders may be happier at 3 years even though your score doesn’t move.
Bob says
I have two defaults, one from 2015 and one from 2016. Both aren’t satisfied but I do pay back in small amounts monthly. My credit score is poor as my credit card utilisation is high and the two defaults are there. I have 3 credit cards, two which I plan on paying off in the next 6 months and closing so I only have the one. My wifes credit is very good and we aren’t financially linked as yet. We plan on applying for a mortgage In two years time (which is when my defaults should have dropped off) will I have a problem getting a mortgage with her by then? Thanks.
Sara (Debt Camel) says
Yes you will have problems with getting a mortgage.
Your credit score isn’t the only thing that matters when getting a mortgage, the lender will see the defaults haven’t been settled because your payments will still show on your bank statements… and if you stop paying them the creditor may go for a CCJ.
So the main options you have are to repay defaults or to settle them with a full & final settlement offer. The debts will still drop off even if there is a F&F.
If the debts are credit cards or loans and have been sold to a debt collector, there is one other route which will sometimes work, see https://debtcamel.co.uk/settlements-old-debts-cca/
Bob says
The debts are quite small, £500 and £600, they will be paid off by the time I’d look to apply with my wife. They also drop off in the next year or two anyway as I’ve said. This should boost my score massively if I can manage my credit under 30%?
Bob says
Just one more question if you don’t mind, if a default is marked as opened in 2016 but marked also as updated in 2018, does the 6 year droppoff start when it’s opened or from the updated date of you get me, aplogies for both posts, brilliant forum.
Sara (Debt Camel) says
what does the credit record say the default date is at the moment?
Sara (Debt Camel) says
The best boost to your credit score is to get your card balances down to zero so you can use and repay in full every month.
But as I said before, your credit score is a sign if something has been wrong in last 6 years with some of your finances – it is not the key measure to for getting a mortgage. People with good credit scores get declined… Those defaults need to have been repaid at least 6 months before you apply for a mortgage, preferably a year.
Bob says
It says updated Feb 2018 but the default started and says opened 2016, confused by that.
Yeah it will be paid and dropped off. With my wife’s good credit score in two to 3 years we hopefully won’t have an issue.
Sara (Debt Camel) says
I can’t tell what you are looking at – which credit report is it?
Bob says
Clearscore, not sure what updated means.
Sara (Debt Camel) says
So Clearscore reports on Equifax data. I suggest you get a copy of your Equifax statutory credit report, see https://www.equifax.co.uk/Products/credit/statutory-report.html. This is free and though it isn’t as pretty as ClearScore, it has all the information you need – you need to find this debt and see what the default date is.
Liam says
Hi, I have a satisfied CCJ on my credit report which is due to be removed this month. Apart from that I have no defaults or missed payments. Will the removal of the CCJ have a positive impact on my credit score?
Sara (Debt Camel) says
yes it should do – why not come back and say how much it changes? people love to read real life examples.
Liam says
Hi, My current score with Experian is 771 which puts me into the ‘ fair’ category. It also says there are 8 positives and one negative affecting my credit score. The negative being the CCJ. I hope for a much better score next month. I will let you know.
Cheers,Liam.
David says
Hi Sara,
Great info on here, Ive looked and cant see any issue similar to mine, I wonder can you help.
My Santander credit card defaulted in May. Apparently in Dec & Jan payments were missed, and the DD was cancelled by Santander as two were missed despite there being sufficient funds from there onwards to pay the DDs.
Any letters I have not received, as I have been in Lisbon since December, and not able to travel back to the house because of COVID.
I received the last message from Santander in February about my account.
I was not aware it was going to default.
This was my only piece of credit, and my credit score was at 953, and now at the poor level, JUST as we were going to get a mortgage in Portugal. ( I only discovered the default when they asked for a copy of my credit score)
Its disaster.
What can I do to resolve:
A my credit score and get it back up
B the default I wasnt made aware of
C How can I work with Santander to resolve this
D how long will it take for my score to recover
E my plan is to pay off the balance, is this the best course of action ( and will it impact my score)
Is there a process where they should have contacted me and is there any way this can be revoked?
Thanks, Dave
Sara (Debt Camel) says
I received the last message from Santander in February about my account.
what did that message say?
If you are getting a mortgage in Portugal, do you know your UK credit score will be considered? I am just asking, I have no knowledge on this point.
David says
Hi Sara, the last message was a text message asking to contact them.
Not that its an excuse but father in law was very ill and then passed away, its a message that got over looked.
Its a funny thing, I didnt know that Portugal would require our UK credit score, they asked yesterday hence why I got the report.
It will also not be a fair representation as I am not on the electoral role in the UK, we live in Portugal, so all a bit strange, and this card was the only credit I had had in about x6 years.
The other issue is, the debt is now due for collection, and I still am not aware of what is happening, or what I need to do.
With COVID we have been stuck here, and now I suspect I will receive letters that I cannot access.
Santander have advised that there isnt anything I can do about the default.
Devastated!
David says
Also, Santander advised I make a Notice of Correction on my credit file to advise of the circumstances.
I take it this will not affect my score?
Also, what is the situation now, will the balance have to be paid? Will an agency look to collect, what is the best thing to do to make my credit file improve in the quickest way possible? And what can I do to get from ‘poor to fair’
I am going to set up a Logbox account as this seems the only way I can get ‘credit’ in the UK.
Appreciate any advice/guidance.
Thanks Dave
Victoria says
Hi,
I am actually at the moment pretty heartbroken,
I have a ccj on my account that was £590 and was paid off and settled in 2015 so due to go next year. I also have one default that was added in 2018 but I have paying off every month and it currently stands at £1200 I have one credit card that I have not used for several months and I have never missed a payment and always pay more than the minimum payment.
Last month I was approved a MIP so I have last week found a house and had an offer accepted. I have no other debts and have managed to run a house and always paid my bills on time for the last 9/10 years (apart from stated 1 default and ccj above) I have a 10% deposit saved and my annual salary is around 30k. Can I still get a mortgage under the current circumstances with a 10% mortgage? I will be devasted if I can’t as I had nogotiated hard to get 11.5k off the asking price of the property. And so scared that I won’t get approved because of the default on my account, please could you advise?
Sara (Debt Camel) says
Did you go through a broker to get the MiP?
If you went directly to the lender, did you tell the lender about the CCJ a and the unpaid default?
Susan says
Hi Sara
What a fantastic article! The world of the credit file is a minefield.
All my adult life my finances have been a mess up until 6 months ago at the age of 40 when I took responsibility for my actions.
I know that there is no quick fix. I currently have 6 defaults on my credit file dating from June 2014 to November 2018 and no CCJ’s. My mortgage is in arrears though these are being paid through an arrangement which should finish in 12 months.
I understand that nothing much will improve until the end of 2023 and at this point we want to move which will mean a new mortgage.
My question is what can I do to help matters, our finances are much better and will improve when a big payment comes to an end in December. Should I clear these defaults, they are all relatively small the most being £1800 and the lowest around £300 and I would be able to do this by the end of 2021?
Sara (Debt Camel) says
I understand that nothing much will improve until the end of 2023
why 2023? the last default will go in Nov 2024.
if you want to go for a mortgage in 2023 with at least one default still showing, then your top priority should be to (a) avoid any CCJ and (b) settle the debts with the later defaults asap – these are the ones that may still show on your credit record when you apply so you want them to have been settled for as long as possible.
Susan says
Sorry my error yes you are correct 2024.
The reason we want to move then is our youngest child will be 18 and hopefully going to university or pursuing a career of some kind.
Do you think it is worth negotiating settlement figures as these are the highest debts?
Thanks again
Sara (Debt Camel) says
Ok so if you only Need to move when all the defaults have gone from your credit record in 2024, the settle as many debts for as little as you can! Also do this soon, so they are gone and it’s less to worry about.
Full & final settlements don’t have a bad affect on your credit score. Many Future lenders don’t care at all, they are just happy the debts are settled. And if the debts have dropped off when you go for a mortgage no one will know, except the lenders you actually settled with!
Liam Doyle says
Hi
I mentioned in an earlier post that a CCJ was to be removed from my credit report. I have just checked Experian and am pleased to say that my credit score has gone up from 717 ( fair ) to 999, the highest possible score. I’m chuffed.
Sara (Debt Camel) says
Thanks for the update – and what a great result!
Jack Brown says
Hi Sara
Thank you so much for looking at this.
All my adult life my finances have been a mess up until 2 months ago at the age of 28 when I took responsibility for my actions.
I know that there is no quick fix. I currently have 8 defaults on my credit file dating from 2014 to 2019 and with 2 CCJ’s. All my CCJ’s and defaults are less than £500 each. Everything is now marked as satisfied.
I’m super proud to say I don’t have any debt I’ve cleared EVERYTHING off in FULL and all my current credit commitments are paid on time. Im now just using a credit card of £250 to put petrol on and pay it off straight away so the account looks like I’m being responsible with money.
Everything negative will drop off my file by June 2023 apart from 2 default wich will drop off in sept 2025.
My question is what would you do in my situation to help your score?
Sara (Debt Camel) says
keep doing what you are doing! Make absolutely sure everything is paid on time – one of the biggest danger areas is if you change mobile providers or sell a car and move house – then letters about parking tickets and remaining balances on utility bills or phone bill may go the wrong address.
Jack Brown says
Perfect thank you :-)
Would you consider buying a house after everything is dropped off the file or after the last CCJ drops off?
Sara (Debt Camel) says
oh talk to a broker when the CCJs are gone and see what the mortgage market is like then.
Georgia says
Hello,
I recently did a credit score check to find that my score was really low, after being denied by a few credit card companies I decided to look at my credit report which showed I have a CCJ dated August 2019’ I have now paid this CCJ off, and awaiting to hear back from the court for my certificate of satisfaction. Me & my partner are currently saving for a house, hoping to apply for a mortgage towards the end of 2021/2022. Would it be likely or unlikely that we’ll get a mortgage or not? are there any ways to bump up my credit score in mean time. I have no credit cards, and I have paid my car insurance in full. I didn’t realise the importance of a credit card/ credit score I always thought it was better to not have them!
Sara (Debt Camel) says
It is very unlikely you would get a mortgage with a CCJ except at a very poor interest rate.
Increasing your credit score in the meantime, unfortunately, won’t help – it is the CCJ itself that is the problem, not the low credit score.