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?
Rebecca Bingham says
Hey iv had a default removed from
Equilfax but can’t see an improvement in my score. When should I expect my score to rise now they have deleted the wrong default?
Also how long do hard enquirers last on my report? I can still see them from 2016
Sara (Debt Camel) says
Do you have other defaults or problems?
Hard checks aren’t usually counted in credit checking after 6 months or a year.
Ian says
Hi Sara,
I have just today won a bit of a battle with a mobile phone provider who defaulted me in November 2019 over £16…yes £16! And I didn’t even know.
Long story short I should never have defaulted – it was their error. Today they have FINALLY admitted fault and removed the negative marker from my credit file. They said to me that it will take up to 30 working days from today (24th June) for this to reflect on my credit file (5th August) but major lenders will be able to see the update on my file within 2 working days.
We are looking to put a deposit down on a new build development that is offering a 5% deposit contribution to NHS staff (my wife is a nurse) as a thank you for their hard work tackling COVID. The house that we want is the last one on the plot (they are selling fast) and we don’t want to miss out on getting it by having to wait until August but we need an AIP to reserve the plot.
My question is will the default be removed from the lenders being able to see it in two working days allowing us to apply or will I need to wait to see it on my credit report first?
Sara (Debt Camel) says
I am sorry but I can’t say if that will or won’t happen. My fingers are crossed for the two of you.
Matt says
Hi,
I have 5 ccjs on my credit file from parking tickets, one in 2014 and the others in 2019, now these are already
on my credit report so too late,
what are my options if I want to get a mortgage ? Thank You
Sara (Debt Camel) says
did you know those tickets were going to court?
Lydia says
Will my score improve when my ccj drops off in a few months?
Sara (Debt Camel) says
Yes!
But how much it improves will depend on what other problems are still showing on your credit record.
Chelsea says
Hi,
Ive has financial difficulties in the past which have resulted in me defaulting on 6 account these are all over 2 yrs old now, however I’ve just signed up to check my file so I can compare the details the credit reference agencies have for me and the dates that were registered for 5 of these defaults are the same on Experian and equifax but the dates have been registered months later on transunion (Experian & equifax we’re both the same dates by the way).
Obviously this isn’t ideal as it adds extra time on before the defaults drop off after 6 yrs!
Any advice would be appreciated
Many thanks
Any advice about this would be greatly appreciated
Sara (Debt Camel) says
Ask the relevant creditors to change the dates on TransUnion to be the earlier dates on Experian and Equifax.
Chelsea says
Thanks for your quick response!
Any idea why they have been reported to transunion at a later date ?
Sara (Debt Camel) says
No!
Nicola says
Hi,
I have a CCJ due to expire 16th August 2020. How soon will the credit reports show this and when will my score improve? Is it likely to be 17th August 2020 ?
Thanks.
Sara (Debt Camel) says
The record should be removed from your credit file the next day. Many credit reports you can see are not real-time, just snapshots, so wait a few weeks before worrying if it stil shows!
Nicola says
Hi Sara,
Thanks for your response. Please could you reply further; do lenders also just see snapshots or do they see real-time?
Thanks.
Sara (Debt Camel) says
They see in realtime.
Tash says
That’s not correct. Bring a credit product manager at a bank, I can tell that the bank only sees what’s latest with the credit broker, like Experian. A credit broker’s records are at least 2 months behind, at best and usually 6 months behind.
The reason is, the conciliation of all records sent to the broker on a party take time and not all records are sent immediately. Most banks do this once a month.
Sara (Debt Camel) says
Yes, I should have said a lender can only see what the CRA has been informed of – that was what I meant by “real-time”.
Lubs says
Hi Sara
i have 3 credit cards, all above 90% utilization and have withdrawn cash at 0% . My 0% balance and money transfers promotions are coming to an end in next couple of months and i am ineligible for any new 0% balance transfer; what do you recommend i do – pay off 1 or 2 cards completely with my savings or reduce outstanding balance on all 3 to less than 30%?
Sara (Debt Camel) says
Why have you withdrawn cash on a card when you have savings?
What will the interest rates on Each of the cards be?
Lil says
Hi Sara, just about 3 years ago, I lived in Glasgow. I moved down to England when I got my job offer. I live by myself and don’t really spend much, but on my rental and life.
I never liked the idea of doing anything I could pay cash for. So just use my regular bank account.
Long story short, I am in a much better informed and wanting to purchase a flat. I decided I needed to check my credit file just in case.
Well, I wasn’t expecting this. 3 years go after I left Scotland, apparently a Decree was issued. I NEVER knew.
So I did an application to recall and it was granted. I’m waiting for it to be signed off now. But it’s on my credit report and I don’t know what to do. It’s cost me my credit and even the court has said it wasn’t even mine.
What do I do and how long before I can gain those points back? Urgently needing advise.
Thanks
Sara (Debt Camel) says
I will ask a Scottish adviser to asnswer this.
Alan McIntosh says
Hi Lil
The first thing you should do is ensure all mention of the decree is removed from the Registry Trust’s Records, who keep a record of all decrees.
There is a £6 administration fee. See here. https://www.trustonline.org.uk/help-topics/scotland/
You also want to contact the main Credit Reference Agencies and obtain a free statutory credit report from them to see if they have information about the decree in their records. The three main credit reference agencies are Transunion, Equifax and Experian. If they do raise a dispute with them to have the information removed.
https://www.experian.com/blogs/ask-experian/credit-education/faqs/how-to-dispute-credit-report-information/
Lil says
Thank you so much.
How long before it gets deleted and what happens with my credit score then? Will it go up right away with it off or am I starting a long road ahead?
Thank you,
Lil
Paul says
Hi
My scores over the three are:
ClearScore: 223
Money Super Marker: 527
Credit Karma: 527
They each have the same info on them which is correct. I have three active defaulted accounts (default year is 2018) which I am paying and will be cleared within 3/5 months. All other active accounts are paid on time and never defaulted. My aim is to get a mortgage (eventually). My defaulted accounts are with the major credit builder credit cards (Capital One, Marbles, Vanquis etc) so I wont be able to apply another card later down the line to help build my account and show I can NOW borrow money and pay it back. ONce my defaulted accounts are paid and closed, what is the best advice for me to eventually be able to apply for a mortgage with an okay interest rate?
Thanks
Sara (Debt Camel) says
What are your active accounts?
Paul says
car finance which i’ve had for 3 years which finishes next month, paid in full (all payments made on time). i will own the car fully and will be keeping it
Mobile phone which Ive had for about 5 years, never missed a payment. Car insurance I pay monthly.
Sara (Debt Camel) says
So when the car finance ends you will have more “spare cash”.
The following is my suggestion – I can’t be sure it will work s it depends on how the credit card and mortgage markets change over the next few years which, post pandemic, is unknowable… But it’s my best guess at the moment.
I suggest you take out a LOQBOX 12 month saving scheme. This is set up so it looks like you are repaying a loan. See https://debtcamel.co.uk/loqbox/. That will get another year of nice green ticks on your credit record.
Then wait until at least a yearafter you repaid the defaults before applying for one credit buider card. If you are accepted, great. If not, wait another 6 months and try another one. At some point you will get one!
Paul says
Thank you, I had already read the article on LOQBOX previously but wasn’t sure if I should wait till I paid the defaults in full first, but I will apply for one straight away. Cheers
Sara (Debt Camel) says
i would probably clear the default first before you start saving!
Louise J says
Hi I have 2 defaults that are due to drop off my credit file this August (all cleared and paid up) will my credit score go up straight away or does it happen gradually?
Sara (Debt Camel) says
do you have other defaults or missed payments still on your credit record?
Suzie says
I have a default on my account for 2017 – I now have a new default registered to my account after my ex partner didn’t pay back his overdraft on the joint account and didn’t tell me.
How much of an effect will the second default have if I already have one on my account?
Sara (Debt Camel) says
Sorry to hear that. There aren’t given figures for this as it depends what else is on your account – any missed payments, are you using a high percentage of a credit limit etc.
Perhaps you could come back and say what happens in your case as other people would also like to know this!
But whatever the immediate harm to your credit score, the long term damage is that the 2017 default would have dropped off your record in 2023, you are stuck with the new one until 2016 :(
Annie says
I have a CCJ on my credit report which has been there since 2014 and is due to come off this November 2020. My credit score reads 530 i want a mortgage and am struggling to get one. I have paid the CCJ in full since 2014 and it appears as satisfied ever since.Please advised on what to do to boost my credit.
Sara (Debt Camel) says
Wait until after November 2020.
How large a deposit (%) do you have?
Sharon Locke says
Hi in 2017 I had an issue with O2 who informed me that, as my daughter had run I her bill, I had to pay a one off fee. (Can’t remember amount) this was paid and I was told it was final settlement. However, they go iTunes to chase for payment and after writing loads of times, I got nowhere. I then wrote to the CEO and suddenly the payment claims stopped. Unfortunately I asked if this would affect my credit score and was told no. To this day, I still have missed payments and I have written to them several times asking for it to be removed. How can I get the (not) missed payments off my score? Any advice would be very helpful.
Sara (Debt Camel) says
I suggest you put in a written complaint, explaining that they have agreed you don’t owe the money (correct?) and that you were told this would not affect your credit score. Say you want your credit score corrected. Take the complaint to the Financial Ombudsman if they don’t correct your credit score.
David Hume says
Hi Sara,
I unfortunately defaulted on a Santander Credit Card, I was out of the country throughout COVID, I have to take some responsibility for what happened, yet here is my question.
the default has wrecked my Credit Score. Santander have not issued any CCJ, they have now referred the debt to a collector, what is the situation here? Can the collector issue a CCJ? My score now haas to be rebuilt, what will happen if a CCJ is issued?
I am trying to see what will be the benefit to my credit score if this balance is paid.
What would you recommend?
Thanks Dave
Sara (Debt Camel) says
Can the collector issue a CCJ?
In theory, yes. In practice it is pretty rare for a debt collector collecting on behalf of a credit card lender to do this (I am assuming this isn’t a business credit card with a very large balance). It is more common for the lender to sell the debt after a while to another debt collector who may go for a CCJ. So although a CCJ is a worry, it isn’t likely to happen soon and can be avoided usually if you make an arrangement to pay.
My score now has to be rebuilt, what will happen if a CCJ is issued?
A CCJ is further bad news for your credit score, for another 6 years.
I am trying to see what will be the benefit to my credit score if this balance is paid.
See https://debtcamel.co.uk/defaulted-account-credit-score/ – bottom line no immediate benefit to your credit score but makes it easier to get credit in future AND avoids any chance of a CCJ.
Dave says
Thanks Sara, much appreciated.
Regards Dave
Hannah says
Hi Sara,
I’m looking for some advice. I got into some really bad debt trying to keep myself and my now ex afloat while he was at uni getting his degree (i was on minimum wage at the time). The majority of the accounts defaulted in 2019 and I have fully paid off all bar 2, which are due to be paid off by the end of the year. I got a new job and so I am able to start saving for a mortgage etc. but my credit score is abysmal. From what I’ve read, paying off my default won’t fix my credit score – although they will prevent CCJs. By the end of next year I’ll have a decent deposit (including help to buy, it’ll end up as around a 25% deposit), but from the looks of things that won’t mean anything and i’m basically screwed for 6 years.
What can I do?
Thanks,
Hannah
Sara (Debt Camel) says
You won’t get a mortgage unless you have settled the defaults and the sooner the better as lenders like to see a period with no problems before the application.
Once all the defaults are repaid, the old rule of thumb used to be that some lenders would lend 3 years after a default and 1 year after all the defaults were settled. So that would be some time in 2022. Not great but not as bad as waiting 6 years.
Of course no-one knows what the mortgage market will be like in 2022 and 2023, but all you can do now is settle the defaults as fast as you can and save as large a deposit as you can.
Andy says
Hi Sara
I have a late payment marked on my credit file from Argos Card. Unfortunately this was just an oversight and when I noticed I made the arrears payment immediately followed by a payment to pay the full balance, to avoid further monthly payments becoming due.
My payment record has since been good although I have not used the credit card that much.
I spent years getting through a DMP and my defaults fell off my credit file a couple of years ago.
Would you recommend me contacting Argos card requesting that they move the marker from my credit file? And if so how should I go about this?
I may need to obtain credit in the next few months.
Thanks
Andy
Sara (Debt Camel) says
This “please be nice to me” appeal is best made immediately after you miss a payment and have repaid it. Anecdotally it is much less likely to work if it has been a while. Also I think catalogues are often hard to deal with and not reasonable.
But if you want to, then I suggest sending them an email or a request through an online form. make it clear you are not lodging a complaint, that you know technically the marker was correct, but it feels unfair given your otherwise immaculate payments record and ask them to remove it as a goodwill gesture.
Andy says
Thanks Sara. I’ll give that a go
Catherine says
Hi Sara
Please I need your advice. I ran into debt few years ago due to bad marriage and financial difficulties. A default was recorded on my credit score and a year later a ccj was recorded. I did not paid off the debt so both default and ccj remained on my credit file. This year mark 6years and the default came off. Now only have the ccj for another year to come off next year. I do not have any other problems on my file except for that one ccj. My question is will the ccj stops me getting a rented apartment? I’m trying to rent an apartment and I’m scared I might get rejected once they look into my credit file and found my ccj
Thank you
Sara (Debt Camel) says
Yes it may well cause problems if you go through a letting agent. Is there anyone that could act as a guarantor?
Hannah says
Hi Sara
I have a poor credit score , I have cleared my debts and this evening I was checking my Experian credit score and I was told I was pre approved for a capital one credit card the only problem is the limit of 200 . All my defualts fall of in early 2022 . And looking at getting a mortgage next year, just need to save a bit more . I was wondering should I just keep this card with a low limit or cancell the card as the low limit will hurt my credit score.
Thanks
Sara (Debt Camel) says
do you have a current credit card at all?
Hannah says
Hi Sara
No I don’t have any now I have four defaults payed off , they will be five years old in January to March . I was hoping for a higher amount to show any morgage lender I can manage , but with the limit so low . Wasn’t sure if it would look bad on the application. Any thoughts thanks
Hannah
Sara (Debt Camel) says
so what % deposit do you expect to have next year? are you looking for a mortgage early or late 2021?
Darren Martin says
Hi Sara
A ccj just recently dropped off my credit reports with Transunion, Experian, and Equifax. but instead of my score going up it went down.
E.G Equifax was 179 down to 171.
i have no other negative markers so why would this be? and what can i do about? I called Equifax and they said thats the score and thats what their system says!
I raised a dispute and all they said was just because I am unhappy is just my opinion, not helpful,I have worked hard for 3 years on my credit reports and now have no negative info on my report.
Who could help me with this?
Best wishes
Sara (Debt Camel) says
Which reports are you looking at? Has your score dropped on all 3 CRAs? Did a debt drop off at the same time as the CCJ? What current open credit accounts do you have?
Darren Martin says
Equifax dropped
Experian didnt change
Transunion stayed the same
The only credit account I have is with a credit union balance owing 900 ends in may 2021 but could be ofset by credit union savings which is currently 1200.
Sara (Debt Camel) says
ok, some reports you see are not “real time”. I suggest you wait another few weks and check again.
Baz says
Hi Sara
I have a CCJ that has now been paid and it has a default date of 22nd September 2014 and a discharge date of 9th November 2016, when will the CCJ be removed from my credit report?
Thanks
Baz
Sara (Debt Camel) says
6 years from the date of the CCJ – is that 22 September 2014? if so, it will go next month.
Baz says
What is the difference between the default date and the discharge date? I am hoping it will be removed on the default date. 🤞
Sara (Debt Camel) says
I don’t know what report you are looking at – those are not really normal terms. i am guess the “default date” is the date of the CCJ decision by the court? And that the “discharge date” is the date you paid it? Do the date sound right for that?
Baz says
Yes i think that sounds right, so will the CCJ be removed 6 years from the default date or from when the debt was paid?
Sara (Debt Camel) says
From the date the CCJ order was made by the court. I have never heard that called the default date before. What report are you looking at?
Baz says
On Clearscore it says “default date” and on CreditKarma it says “filed date” and on TotallyMoney its called “judgement date” and they all have the same date of 22nd September 2014
Sara (Debt Camel) says
oh, that was the date the CCJ started and it goes 6 years after that.
Baz says
Thank you for your help.
SJ says
Hi there,
I’ve spent last few years clearing out debts in my name one of which was a ccj that flew under the radar (long story). I paid it off but it was outside of the 30 day period. It’s due to come away in November this year 6 year anniversary.
I’ve kept credit card balances below 25%, there was one missed payment about 3 years ago being the only mark in that time.
My credit score seems to hang around the poor/fair depending which agency I check against. Eg 573/710 via Credit Karma site. On average when the ccj drops off and I continue keeping everything smooth what is the likely bump I’d expect to see?
Sara (Debt Camel) says
It’s hard to guess. It will depend in detail on the rest of your credit record. Could you come back and say? people love to hear actual examples.
SJ says
Certainly, my Equifax one loiters around 330-360 regardless. I’ve paid off a car loan a few years back. Keep credit cards low as possible.
Lost one old ccj from 6 years ago a few months back (did forget about that). One of my credit cards is reasonably new so not expecting a jump because it’s relatively new.
November the last ccj goes and hopefully will be reflected quickly.
SJ says
Hi there, looks like it’s finally dropped off.
Just checked my Equifax via capital one.
Score has been a steady 362 for months and months. It’s now jumped to 497.
Nix says
Hi SJ
I just had my last CCJ fall off and it happened exactly 6 years to the dayof the judgement. My transunion credit report went up by 51 points and I’m now in the fair category but I think this is because I don’t have a credit card. My experian went up to 999 and the equifax is also in the excellent range. It all happened very quickly for me. Hope this helps.
Bisi says
Hi there,
I had a CCJ on my credit file from 2016 with Anglican water which i did not realize until late last year. Luckily i have been able to get a phone contract and a credit card with Capital One which i have been paying on time. However i would like to get a mortgage in 2-3 years time. I have tried to contact the debt collection agency regarding my outstanding balance but i have not been able to get through to them. Would you suggest me waiting till the CCJ falls off after the 6 year period or trying to pay it off.
Many Thanks
Sara (Debt Camel) says
so the CCJ will disappear from your credit record after 6 years – which is before you would want a mortgage?
have you been contacted about the CCJ?
Bisi says
Hi,
No i have not – and i have also moved address since 2017.
I intend to apply for a mortgage after the 6 years is up.
Thanks
Sara (Debt Camel) says
The CCJ will go after 6 years whether you pay it or not. And you will find it difficult to get a mortgage until it has dropped off, paying it won’t make much difference.
If you aren’t contacted by the time it drops off, then it is pretty hard for a creditors to try to “enforce” the CCJ later – they have to go to court to get permission and that isn’t often given.
I suggest putting the money aside so it’s there if you are contacted about it.
Vik says
Hi,
Looking for some advice re: my credit score.
I have bankruptcy on my file which will be 6 years old next June which is great but I have a single default from the following year with Yorkshire water. Other than those ‘blips’ I’ve got good job
, my bills are always paid and have been paid on time (apart from this one Yorkshire water one) and I have a credit card which is at about 70% utilisation. My question is; will my credit score increase significantly when my bankruptcy drops off or will I have to wait until the default drops off?
Sara (Debt Camel) says
Yes your credit score is likely to improve a lot.
Nikki says
Hi there,
I have got a few defaults (one on mortgage) from 2018 & 2019. Last default being registered in November 2019 and then all paid off in Dec 2019. I have no debt, good credit card utilisation ratio and all green ticks since December 2019. My credit score is Fair and has been since last year. I have got 30% deposit but worried to apply for mortgage in case it gets rejected. Do you have any advice?
Thank you
Sara (Debt Camel) says
Wait a while? This is VERY soon after the defaults.
dani says
Hi Sara
I have a question: Just found out I have CCJ on my credit history. CCJ was placed on my credit history on 14/04/2016 and it says it was satisfied on 15/04/2016. Looking back through my bank statement I found that I paid the full amount to Anglian water on 14/12/2015 but they still placed This CCJ on my credit report I struggles for 4.5 years getting any credit. I have called Anglian water and ask them to remove it but they are making excuses saying this team will call you and that team will call you. Apart from putting in complaint what else I can do as I am in the process of getting mortgage.
Sara (Debt Camel) says
Definitely put in a complaint. You could also try emailing Peter Simpson, their Managing Director – psimpson@anglianwater.co.uk. Ask for a speedy resolution of this problem.
But realistically it may not be that fast :(
Dani says
Hi sara Anglian water has replied today. I need some more advice. Basically CCG on my credit report says 14/01/2016 and satisfied on 15/04/2016. I made the full payment of the bill which was £393.12 on 14/12/2015. They have come back saying to me I did not pay them the court and solicitor fee and that I made that payment on later date. Can you please advise what I can do. it looks like they are saying they got CCJ on 14/12/2015 against me and I made full payment on same date is this CCJ still valid?
Sara (Debt Camel) says
when you paid them in December, were you aware they had started the court claim?
what was the date of the CCJ from the court papers?
dani says
Hi Sara
I cannot find the paper work for that.it looks like I did make the payment of what I owed to Anglian water on 14.12.2015 but looking through my bank statement I made further £182 to them in march 2016 which could be solicitor and court fee. How do I find out thatches CCJ was executed correctly?
Sara (Debt Camel) says
How do I find out thatches CCJ was executed correctly?
Not sure what that is.
Were you send a letter by the court saying there was a CCJ?
Were you aware a court case had been started?
dani says
Hi Sara Anglian water are claiming they applied for summon on 10/12/2015 but I did not get any paper work before I made payment to them on 14/12/2015. no I did not know they were going to get judgment. I was forced to pay this money of further £186 on 13th of march 2016 as they claimed it was court fee etc and I wanted all of this to go away and paid that at the time now looking back I feel I should not have paid that.
Sara (Debt Camel) says
You have to find the date the court judgement was entered.
It isn’t clear to me when you got the court papers and why you did not defend the case.
But if you have paid the judgement amount in full, part in December and part a few months later, within 30 days of the judgement date, the CCJ should be removed from the records.
David says
My credit rating has dropped by 90 points for no reason nothing has changed from last month or the past 6 months
Sara (Debt Camel) says
what report are you looking at? have you done a line by line comparison of the reports?
David says
I’m looking at credit wise and clear score and checked everything
Sara (Debt Camel) says
ok, both those reports are based on Equifax data. I suggest you ask Clear Score why your rating has dropped – be persistent.
Dani says
Hi Sara I am going to try and explain my case again and see if you can help. I have CCJ on my credit report dated 14/01/2016. It says satisfied on 15/04/2016.
According to Anglian water they applied for county court claim on 10/12/2015 but I paid the full bill which was £393.12 on 14/12/2015 before I received any papers from court. Anglian water are saying because I did not pay their legal fee etc on 14/12/2015 that’s why they went and got judgment on 14/01/2016 I thought I have paid the bill problem has gone away but later they sent me warrant and I paid £186 of the fee as well on 10/03/2016 but they are refusing to set it aside saying they did everything correctly. My argument is if I paid full bill before I had any paper from court why should I pay their legal fee etc.
Is there anything I can do to set aside this CCJ?
Sara (Debt Camel) says
ok, I was hoping for the simple case where you paid the legal fees within a month of getting the court judgment – if you had, the CCJ should have been deleted from your credit record. That won’t work.
You can talk to National Debtline on 0808 808 4000 about whether you have a case to have the CCJ set aside. really this should have been done as soon as you were aware of the CCJ.
At the moment the CCJ will drop off your records in Jan 2022.
Darren Martin says
If you paid the judgment within 30 days and anglican water agree they can do an order of consent form for the court. the court fee is £100.00
or if they disagree you could ask for the judgement to be set aside and put a case in that will cost £250 if the judge disagrees with you you lose the fees. just my experience. To get an order of consent form you need to write to anglican water with a case of why they should agree to remove the judgment. Alternatively if they dont agree look up Consumer Council for Water and complain through them they will mediate. if they are unsuccesful in mediation escalate complaint to WATRS. WATRS are the ombudsman if they agree with you Anglican will have to give you the order of consent but when you put this into the court include full details of the case.
P patel says
Hi Sara
My credit score had changed from 950 to 504 because of a wrong default account. Now the company has agreed that it was their mistake and they are removing the default from the account and settling the account as closed. Will my score improve? And do I need to contact agencies individually? How much time does it take for the score to recover?
Sara (Debt Camel) says
It will probably take a few weeks for the creditor to tell the credit reference agencies. There is no point in you doing this.
Depending on what report you look at, it may take some more time to show up on the reports you see. See https://debtcamel.co.uk/best-way-to-check-credit-score/ and make sure you check it has been removed from all three credit reference agencies.
If the default was wrong and there were no problems on the account, the your score should go back to what it was. But if the default is wrong and it has been replaced by a missed payment marker or a payment arrangement, you score will only partially recover.
Melissa says
Hi Sara,
Can I get some advice from you please?
During a time of financial difficulty, I set up a debt management plan with Stepchange in 2016, one of my creditors was Very – Shop direct group. They didn’t mark my credit file as in default and agreed a regular monthly payment through stepchange. This payment was paid on time every month without fail and never missed.
During this time they did not send any information to my credit file except that the debt was showing as reducing down regularly every month.
On 9th July 2020, I was in a position to settle my debt in full which I did. I have since found out from checking my file with Experian that AFTER I settled the debt in full, they marked my credit file in July as having missed 6 months worth of payments (even though no agreed payments have been missed for 4 years) and then they didn’t mark it as paid off until August.
This has had a really negative impact on my credit score. Firstly are they allowed to mark 6 months worth of missed payments even though no payments were ever missed and were paid through Stepchange for the agreed amount (4 years after the plan was set up) ?
Secondly are they allowed to do this AFTER the account had been paid off and settled in full to then mark 6 months missed payments on the same month (July) and not then mark the account up to date until 1 month after it was up to date (August)?
I really appreciate any advice you can offer me.
Sara (Debt Camel) says
Have you sent them a complainT saying how unfair this is?
Technically they could have marked your account as getting into arrears while you were in your DMP. But to do this at the point you had already settled the account in full feels very unfair.
Melissa says
Hi Sara,
Yes I have sent a complaint but am yet to receive a response.
Sara (Debt Camel) says
Ok, well see what they say!
Tina says
Hi. I opened a credit card account a few months ago in order to try and build my rating. However, my score is falling, not rising! My score is consistently showing as going down with each of the agencies. I use my card and either pay it off immediately after using it, or pay it in full by the time the minimum payment is due. Why is my score falling? Nothing else has changed on my account and I have not applied for any further credit since opening this account.
Thanks
Sara (Debt Camel) says
The best thing is to use the card for something small each month, one food shop or a tank of petrol. then don’t pay it off immediately, set the car to pay it off in full by direct debit Each month.
It can take a few months for any improvement to show up, but how bad is your credit rating and what sort of problems do you have? Insolvency, CCJs, defaults, missed payments, using a lot of your credit limit?
Tina says
Thanks for the quick reply!
I have two defaults so my credit score has been low for some time anyway (2017 and 2015). I have no other credit really, have not had a loan or anything like that in over a year. My phone bills and my contents insurance are reflected on my file but always paid. I am using less than 20% of the limit on this card over the month.
Could it be because I utilise more credit now compared to not really having anything in the previous 18 months? It’s frustrating because all the advice for rebuilding credit says to do this by making cc payments on time and in full. My score was going up slowly prior to this and I had just tipped from ‘fair’ to ‘good’, but have now fallen back again.
I have set a direct debit up now for full amount so will have to see what happens!
Sara (Debt Camel) says
I expect your score will go back to what it was before and then climb a bit. but these credit builder cards make less difference than you might hope if you have defaults. One of the defaults will dropping off next year anyway. When the defaults are gone, having had this card for a couple of years and always paid it in full every month will make a real difference to getting your score up to being very good.
K. Anonymous says
Hi
I was caught in negative equity during the last recession and sold a property in for 100k ( mortgage was 185k). The account was settled and no longer appearing on my credit file.
At the time the financial adviser advised that as my credit score and file would be impacted fur to the shortfall sale and so not to repay on a credit card I had built up ( used be used the negative equity mortgage was costing me so much on a high interest I had to find other ways to pay). The account defaulted in May 2015 and I am hoping that it is removed from my credit file this May. I make £5 payment per month.
Original debt was with Barclaycard who sold to PRA. Can they sell this debt on again to another debt collector in May?
Sara (Debt Camel) says
what date was your property repossessed?
what is the balance on the {PRA debt at the moment?
what is your current financial situation like?
K. Anonymous says
Hi. Thanks for response.
The property wasn’t reposessed. It was a shortfall sale agreed with the bank and settled. Was in 2014.
Balance is £8500 and financial situation is fine, working full time.
Sara (Debt Camel) says
So do you still owe the bank the shortfall or have they written it off?
K. Anonymous says
They seem to have written off. No follow up and it’s fallen off my credit file. I know they can chase mortgage shortfall for up to 12 years however I’ve read that many follow the 6 year rule.
Sara (Debt Camel) says
I will say here what I always say in this situation. It won’t help you at all but may help someone else who reads this. It is a MASSIVE pity that you did not go bankrupt back after the house was sold. That would have got rid of the mortgage shortfall and the credit card debt, by now all trace of it would be gone from your credit record.
You cannot assume this has been written off. The fact it is no longer on your credit record is irrelevant, that is always cleared after 6 years. I suggest you talk to National Debtline on 0808 808 4000 about this debt now to see if they think it is likely that the lender will not chase you in the next 6 years or sell the debt to a debt collector who will.
re the credit card debt, it will drop off in May. PRA can sell the debt at any point, before or after May. This debt will never become statute barred as you are paying £5 a month to it so PRA or another debt collector can take you to court for a CCJ if you stop paying them. They can also ask you for an income & expenditure form if they think you should be paying more.
K.Anonymous says
Thanks Sara!
Agree that BR would have been the best solution and if I’d known what I know now back then the choices would’ve been different.
I think I will try a settlement offer with PRA and see if it gets anywhere to close the debt.
Rene Doherty says
Hi Sara,
My CCJ is due to drop off next month. outstanding balance is still pending. Will this still have an impact on my credit file once the CCJ drops off?
Sara (Debt Camel) says
No it won’t.
Savy says
Hi there,
I suggest looking at how paying your credit cards off each month as a negative impact to your credit score.
People may find this a contradiction.
I am fortunate I can pay off my credit each month. I try to keep my balance close to, or at, zero.
I monitor my credit score closely with Experian and Credit Karma. I noticed Credit Karma view zero balance as a negative.
I have changed my monthly habits by charging groceries to my credit cards and pay them monthly to see if this avoids Credit Karma’s negative score on my credit card balance. But as I try to avoid interest charges and pay off my credit card, credit karma still gives me a negative score.
I think it’s unfair Credit Karma uses this approach for scoring.
If I was applying for credit or a mortgage it would be a concern.
Sara (Debt Camel) says
Some points:
1) But as I try to avoid interest charges and pay off my credit card When are you paying off the balance? You need to wait for your monthly statement to be produced and to then pay it in full before the date given on the statement. The safest way is to set up your credit card so the full balance is automatically collected by direct debit.
2) even if TransUnion have changed their scoring, Experian haven’t! So you will get higher score through Experian if you clear the balance in full each month and pay no interest. It makes no sense then to try to “buy” a higher credit score on TransUnion by paying interest, knowing your Experian score will drop.
3) how much of your credit limit are you using each month? Try to keep this below say 20%. If you are putting all your groceries on the card, this may be too much. Try just a tank of petrol or 1 grocery shop a month.
4) it sounds to me as though you are paying way too much attention to your credit score! These are artificial numbers that are calculated as a guide by the credit reference agencies. Actual lenders don’t use those scores. I don’t believe there is a mortgage lender in the country that would prefer to see you running a balance and paying interest on a credit card, it harms the mortgage affordability and suggests your finances are less strong than someone who repays in full each month.
Your aim with your credit checks each month should be to:
– be sure there are no nasty surprises you need to look into
– keep you credit utilisation low
– if you can’t pay all your cards/overdraft in full each month, make sure the balances are dropping
– avoid unauthorised overdrafts
– avoid payday loans even if you are sure you can repay them in full on time.
Apart from that, if your score ticks up or down a bit, it is of no practical importance and I suggest you ignore it.
Savy says
Hi Sara,
I am not sure it is worth noting.
From my review, Credit Karma views positive credit use as 1-25% of total available credit. So in Tasha’s case positive credit use is 1-25% of £5.5k available credit.
I agree continue to pay off the cards on a regular basis, such as setting up regular DD.
@sara can you comment further on the credit limit criteria? From what I see Experian does not take into consideration total credit limit. Though I found Credit Karma factors in your total available credit limit and will give higher ratings based on the limit.
Thanks!
Savy
Sara (Debt Camel) says
As I said before, it sounds to me as though you are paying way too much attention to your credit score!
All these points are pretty minor. Minor changes in your credit score make little difference to the chance of a credit application being accepted.
No lender uses the headline credit scores you see on these reports. There is simply no point in trying to analyse in detail the differnces between CK’s credit score caluation and experian’s – where can it possibly get you?
There is a whole industry that has grown up trying to people to be obsessed about their credit score. The pur[pose of this is to get you to apply for more credit – that is how these free reports make money for their providers.
Tasha says
Hi Sara,
Just a quick question – I have two credit cards, both have had a zero balance for a while now. I’ve been wondering whether it is worth using one of the two cards for small purchases (ie my petrol each month) and then setting up a DD to clear at the end of each month. Will this ‘active’ use of spending and clearing have a positive impact on my score, or are the zero balances enough?
I am reluctant to close these two accounts because A- I will lose the credit limits [£3k and £2.5k] which I believe would negatively impact my score, and B- they are quite old accounts and I don’t want my ‘average age’ to decrease. Surprisingly, they’ve not been closed by the lenders due to inactivity… yet.
All other aspects of my reports are fine, sitting in ‘fair’ across the board. I am just waiting for a utility bill default to fall off in 2022 and expect the scores to rise following this.
It’s crazy how much a £60 gas bill which arrived after a change of address (I never received this final bill!) has impacted me for the last 4 years! I’m otherwise meticulous with my credit and have never been in debt. Sigh.
Cheers,
Tasha
Sara (Debt Camel) says
I suggest you should use one and set the card up to collect in full each month by DD. I din’t know how much petrol you use in a month but just one tank will be fine!
Credit limits don’t directly affect your score, only your utilisation. But you will be keeping your utilisation very low.
The average age will not change much if you have two old accounts and close one of them. It only changes if you have a lot of newer accounts. But anyway the average age of the accounts is only a tiny factor.
So I suggest you close the account which has the higher interest rate – I know you aren’t paying any, but this is as good a way to choose between them as any!
Adam P says
Hi Sara, back in April this year, I missed a car payment and didn’t get in touch with the company. I then missed it again in May so was 2 months arrears and then 5 days after missing the 2nd payment, they marked my account as default. I didnt realise this was the case until I went to upgrade my bank account and they said no due to a new default. I use experian regularly and it wasn’t on their, so I checked equifax and yep their. I know this was negligent on my side (after finally recovering from 9 defaults 6 years ago youd think I’d learn). I thought it had to be at least 3 months of arrears (didnt get to that stage) i paid up early June and in the 3 years I’ve had the finance, I’ve never missed a single payment, and since the April may ones, still not missed one. Where do I stand with this? They sent me letters about the arrears but I didnt receive one to say that they were going to default my account They weren’t especially helpful on the phone either. Many thanks.
Sara (Debt Camel) says
So you knew you had missed payments? was this a coronavirus problem? have you now made these payment up or are you still in arrears?
adam p says
Yep, wife lost her job at start of lockdown, and I made payments early June to bring account back up to date. I phoned them after 2nd payment missed and they didn’t say anything about default
Sara (Debt Camel) says
OK then I suggest you send them a complaint in writing (email is fine) saying it was unreasonable to default you when only two months payments had been missed, it fails the SCOR guidelines http://www.scoronline.co.uk/sites/default/files/high_level_prinicples_document_final.pdf which say “As a general guide, [a default may be recorded] when you are 3 months in arrears, and normally by the time you are 6 months in arrears.”. Ask them to delete the default and substitute 2 missed payments.
Melissa says
Hi Sara, My husband and myself want to remortgage our house. My husband used to have a debt management plan which was settled in full in June 2020 and the defaults he had were over 6 years old and have now dropped off his credit file and he can’t see them anymore. We are trying to find out whether when we make our application, if mortgage lenders can still see that he used to have a debt management plan years ago and that he used to have defaults over 6 years ago (7-8 years ago)? Or if they have been removed from his file for him, is that the same for anyone else who sees his file? Kind regards
Sara (Debt Camel) says
This article looks at your question https://debtcamel.co.uk/mortgage-debts-not-on-credit-record/
Anne K says
Hi Sara
I started a 5 year IVA on 17th November 2014, which I completed at the end of April this year, having had to take a couple of payment breaks, it was marked as discharged at the end of June on the Insolvency Register and dropped off there a week ago.
I know that it will stay on my credit file until 17th November this year when, along the defaulted accounts included in the IVA will drop off, except for one with Studio Cards who have recorded the default date as 28th December 2014 and despite numerous letters and emails have steadfastly refused to change the date or to acknowledge my correspondence.
I also have a CCJ that I was not aware of until recently when I started to check my credit file, which was issued in January 2015 at a previous address that I had moved out of prior to the issue of the CCJ.
My question is when will I see a significant improvement to my credit score? Will it be in November or will I have to wait until January when the CCJ drops off?
Thanks
Anne
Sara (Debt Camel) says
It won’t get to very good until the December default and the January CCJ have gone.
Do you have some new debt on your record?
Anne K says
Yes I have a Vanquis credit card and a Loqbox as well as my mobile phone and utilities, all of these have no problems whatsoever, I pay the credit card in full every month.
Sara (Debt Camel) says
Then I would hope your credit score is very good in January!
Darren says
Hi just wondering ive got a 865 experian score ive also got a ccj thats satisfied thats nearly 6years old no other problems, how much will my score go up after ccj falls off, thanks
Sara (Debt Camel) says
It should go up, it’s hard to say how much.
Rebecca says
Hey, does it make a difference to my score if a default is marked as settled or not?
Sara (Debt Camel) says
No.
Bit it may make more lenders happy to lend to you… lenders don’t use the score you see! And many lenders prefer to give more credit to people who have sorted their previous problems out.
David says
Hello group!
Can you recommend the best credit builder card please?
After a few years of sorting debts getting refunds and clearing accounts I’m slowly getting into a better position. For example last mo th I was able to refinance my car for £80 a month less than I was originally paying!
I don’t have an overdraft or credit cards, but want to start utilising this option to better my record using small monthly payments and clearing each month.
Is a credit builder cars the right option do you think?
Many thanks in advance.
Sara (Debt Camel) says
I have just written an article on credit builder cards – see https://debtcamel.co.uk/credit-builder-cards/.
The cards are all much the same. The interest rate doesn’t matter if you pay them off in full every month. Never sign up to any odd extras such as a plan that promises to protect your score if you miss a payment – they cost a fortune and mean you are more likely to get into trouble.
If you can save some money regularly each month, I would suggest LOQBOX as a safer alternative to a credit builder card.
Jack says
Hi I’ve been in an IVA and it’s due to drop off my credit file after 6 years in October. Can you advise how much I can expect my score to increase. Thanks
Sara (Debt Camel) says
That’s hard to say as it’s not just the IVA that will be dropping off, but probably other defaulted debt too. So what credit will remail on your record?
Sean says
Hi Sara
Looking for some help on my current financial state of play.
Credit card 1 – £2900
Credit card 2 – £2000
I am currently paying interest on these 2 cards as the 0% offer has elapsed. My main intention is to stop paying interest on the cards. However, my dilemma is that:
1. I would like to stop paying interest on these cards and transfer balance(s) to another 0% card
2. My (experian) credit score is approaching the ‘good’ score band and wouldn’t want to apply for new credit which will impact my score
3. Looking to get a car soon, hence the reason for not wanting to apply for credit ATM
Would you say I should go ahead and apply for the 0% and get my balances transferred over?
Thanks
Sara (Debt Camel) says
You can see if you are likely to be accepted for a 0% transfer using this eligibility calculator: https://www.moneysavingexpert.com/eligibility/credit-cards/search/?goal=CC_BALTRANSFERV2. That is a soft checker, it won’t show to other lenders that you made a search.
They are harder to get than they were before the pandemic. See https://debtcamel.co.uk/zero-per-cent-balance-transfers/
Making one credit application isn’t going to make much difference to your credit score. And paying less interest will make a big difference to your finances so I would give this a try.
If you can’t get a balance transfer, read https://debtcamel.co.uk/credit-card-minimum-payment/ and do what that says- set up a fixed payment to each card that is more than the minimum. This will make a BIG difference to the interest you pay over the years and how soon the card is cleared.
Chris says
I’m also trying to build my credit back up, I currently have two credit cards which I’m slowly paying off £4000/£500 limit. I’m down to about £2500/£100 on both cards. Would you recommend taking out a loqbox to help show additional financial responsibility or focus on clearing and managing the credit cards first?
Thanks.
Sara (Debt Camel) says
I would get the cards down to zero first.
Mark says
Hi,
Last year I finished paying my defaulted accounts, one was a payday lender and the 6 years passed in September 19 but the it failed to disappear from Experian, so I wrote to them pointing out the 6 years had passed and to be fair they removed it. So I’m completely clear and my Experian rating is 999.
However, I have been turned down for a mortgage and my broke states it because Experian added a notice of correction in relation to the payday loan which has been by the mortgage lender. I waited 6 years for that to disappear but the notice of correction displays all the payday lender information along with my dispute.
I keep writing to Experian to get them to remove the notice of correction but they are refusing to and said that it will not expire either! Is that allowed? My mortgage broker said I’m unlikely to find a lender willing to provide a mortgage in the current climate with that displaying on my credit file and the FOS could take months.
Sara (Debt Camel) says
what does the notice of correction say?
Mark says
So it’s lists the lenders name xxxxx payday and the details my complaint almost word for word, which said ‘6 years has passed on this default and should be removed from my credit file’.
My mortgage broke said it shows I obviously defaulted on a payday loan and said although the default expired, they can still see you took one previously and failed to pay it. He said it’s pointless trying another lender until that’s removed
Sara (Debt Camel) says
Then I should put in a formal complaint to Experian saying it is unreasonable this should not have been removed when the debt was deleted.
pauline says
i have 2 defaults that are almost 2 years old, will points be added to my score when these are lifted after the six years?
Sara (Debt Camel) says
yes.
Ashleigh says
Hi Sara,
I have a ccj due to come off my credit file on 17th dec. will my credit score go up instantly on the 18th dec? How much do you think it might go up? It’s currently 600,
Thanks
Sara (Debt Camel) says
A real time credit score will change the next day. depending on what report you use, you may not see a real time score.
The article above has some numbers, but these are always rough as it depends on what else is on your credit record.
JC says
Hi There
I started the application process for a loan – have received provisional approval etc – but realise i would rather take a loan from my bank for ease. How much would it affect my credit score if I cancel this application and go to my bank instead? Thanks very much for your advice
Sara (Debt Camel) says
Not much if this is the only other application you will make. But do you know what interest rate your bank will quote you?
Darren Martin says
Hi Sara
I thought this may be helpful for others, I had a CCJ relating to Moneyshop pay day loan. Which i satisfied £378, unfortunately by a payment plan through BW Legal. CCJ December 2017 registered. In September 2018 I claimed irresponsible lending, and won in June 2020. During 2018 & 2020 I enteter communication with BW legal try to get the CCJ removed,mitigating circumstances Mental Health played a part. Eventually having sent them a GP letter confirming mitigating circumstances they agreed to consent to remove the CCJ, as long as i paid the costs. I supplied my evidence to the court along with the consent order and £100 court fee. the judgment was reviewed in august 2020 and rejected because i did not state in my evidence why i didnt pursue until September 2018 nearly a year after the judgment. I completed N244 form to have the judgment set aside providing my reasons for delay and it was handed to my local county court. I recieved a judgment order on 2nd November 2020 setting aside the CCJ.
Result Equifax from 171 very poor to 420 good (+249). Experian from 589 Moderate Risk to 651 Moderate Risk (+62) Credit Karma (Transunion) updates next week Onwards and upwards.
Daniel says
Hi Sara
I have 3 defaults and they drop off on 30/11/2020, 27/02/2021 and 04/08/2021. My credit scores are:
Equifax – 290
Experian – 274
TransUnion – 510
I have a 2 current accounts with 6 years worth of perfect payment history, 1 credit card with 6 years worth of perfect payment history and car finance with just over 4 years perfect payment history. There is only 10 months left on the car finance. I am on the electoral roll have have been at the same address since May 2017. Do you think my credit score will jump considerably when those 3 defaults drop off? I have worked so hard over the last 6 years to get my finances in order and I would be so pleased if by August 2021 my score was at least ‘good’.
Sara (Debt Camel) says
I would think you will see a big improvement.
Liam says
Hi Sara,
Having read all of the very useful information above, I was wondering if it was better to settle to defaults now £250 in total but with this likely damaging my credit score a bit as my credit card utilisation would end up being higher.
I have 2 old defaults due to drop off next year (which I have now lodged a complaint against for unaffordable lending at the time. And 2 from 2018 that I am looking to settle.
I also have a credit facility with indigo Michael that Was on a payment arrangement for the last 2-3 years and that will be cleared this week.
The main aim is to get a better rate credit card/balance transfer period at 0% or loan to help clear a higher interest rate loan for my wife.
Thank you
Sara (Debt Camel) says
It is a very bad idea to borrow on a credit card to repay a defaulted debt where interest is not being charged. You pay interest, your credit utiliasation gets worse and if you get into problems you can get another new default!
And settling defaults does not actually improve your credit score at all.
It is hard to get 0% belance transfer offers now unless you have a very good credit record – with defaults, even settled, this isn’t likely.
Indigo Michael – is that SafetyNet credit? Have you looked at making an affordability complaint against them? Many people are winning those complaints, if you do you would get any payment arrangement markers removed from your credit record and get a refund of some of the interest you have paid. See https://debtcamel.co.uk/payday-loan-refunds/ – I know SNC aren’t a payday loan but the standard payday loan template has worked well for hundreds of people!
Who is the lender for your wife’s bad credit loan?
Liam Attrill says
Hi Sara.
The aim of clearing the recent defaults Follows on a bit from settling your outstanding ones for at least a year. I always assumed once you had a default(s) then that was that, but after reading the above, some lenders do take settled defaults into account.
The Loan we are trying to get a better rate on is my wife’s 89.9% likely loan last year.
2 defaults 5 years old (Morses unaffordability complaint raised)
2 defaults around 2 years 8 months old (Lowell & H&T loans) H&T £50 left to pay @ £10pm
Lowell £180 left to pay @ £5pm
1 payment arrangement Paying for 2 1/2 years (safety net credit) £129 left @ £25pm
How do I prove unaffordability? It’s hard to keep track of it all but we are in a better place now compared to then. I had an injury in 2017 which ruined us financially and I still suffer from but that doesn’t really affect anything above but the loans at home and provident loans. We did have 247 money / on stride payday loans too but no adverse history. I know I wasn’t good financially when I took out the H&T loan And safety net loans and I know my credit file wasn’t good. Safety net kept offering me increases and then couldn’t pay, so assuming that is my reasoning? Thank you
Sara (Debt Camel) says
The lenders that will take into account settled defaults are the bad credit lenders like, um, Likely Loans. They won’t get you a good rate loan. And certainly not a 0% balance transfer.
It is not a good idea to borrow on a credit card to pay those old defaults.
Safety net kept offering me increases and then couldn’t pay, so assuming that is my reasoning?
exactly. SNC cases are some of the easiest to win as they could see your bank statements so they should have known better.
If repaying the Likely Loan has caused your problems, get your wife to put in an affordability complaint against them, use the template here: https://debtcamel.co.uk/refunds-large-high-cost-loans/
Liam Attrill says
Loans at home have asked for bank statement. I have asked them to proceed on the basis of my complaint without that information and will provide to the fos should they request it. Is that the right thing to do?
And basically, is my complaint I had lots of loans on the go and kept being reloaned too as well? Do I need to prove that to them?
Thanks for your help.
Sara (Debt Camel) says
How long were you borrowing from them? Any breaks in the lending of more than a few weeks?
Liam Attrill says
We were always borrowing from one lender or another for sure. There could have been some breaks between each loan per lender but always borrowing. I had several loans With loans at home, as did my wife along with being reloaned too. Same situation with provident.
Can they pull my credit report to establish this or will I need to prove it?
Also, realistically, when is it likely I will be able to get a decent rate with regards to credit? Will it actually be once my file is free from defaults I.e. 3 years time? I’ve been a man on a mission for so long now to try and get it sorted so we might actually get a good rate offered to us (which includes a loan maybe next year to go on a holiday as a family) but I won’t take any high interest rate credit out again. So it’s just setting my expectations really. No point getting hopes up if the reality is a lot different.
I could clear those Two recentish defaults in January and credit utilisation would be around or under 25%
Sara (Debt Camel) says
A lender can look at your credit record but it’s often easier to download one and send it to them.
Also, realistically, when is it likely I will be able to get a decent rate with regards to credit?
That wouldn’t have been an easy question a year ago, now it’s impossible. If things go badly with covid-19 or Brexit, we could be looking at several years when the banks and prime lenders are VERY fussy about who to lend to and everyone else faces very high rates. But if the vaccine turns up and we all get back to work and Brexit isn’t a disaster, who knows?
Clearing the defaults will give you a sense that the corner is being turned, even if it takes a while for lenders to realise. A refund from SNC and them getting rid of the payments arrangement marker on your credit record would be a good step in the right direction.
Liam Attrill says
Hi Sara, I had sent a detailed list of loans that were taken out during this period. I’m not sure it went through so I will resend, is that ok? Hopefully you can advise if I have a case, if so, I can forward my report on to them, if that’s a good idea?
Thanks for the ‘reality check’ as well.
Sara (Debt Camel) says
a case against which lender?
Liam Attrill says
It has several but primarily provident and loans at home, as the others are individual cases.
Sara (Debt Camel) says
on that very long list, (which I have deleted) I suggest you should make complaints to loans at Home, provident, Moneybox 247 and Onstride.
Liam Attrill says
Hi Sara, so Morses came back to me and declined my complaint. I was about to write a reply as I can prove affordability issues at that time but stupidly just realised they both drop off my file in March 2021. For some reason I assumed it was November 2021.
I’m happy to wait until they drop off, as it isn’t that long. I was just wondering what you think the likelihood is of them now raising a ccj?
Thanks again!
Sara (Debt Camel) says
Them dropping off your file has nothing to do with whether they can go for a CCJ. There is no point in waiting for this to happen. By making the complaint to Morses you have acknowledged the debt.
I suggest you just send the case to the Ombudsman now. Morses arent likely to change their mind.
Liam Attrill says
Sorry Sara, so I’m not repaying anything at the moment. They are due to drop off in March. Can they still chase me for a ccj after this time then? Or are they likely too now I’ve complained?
I was expecting them to drop off and then leave it as that, as wasn’t expecting any, if much, back as a refund… The most important thing in this case was having the defaults removed.
Their argument was it was so long ago I should have raised my concerns then.
Thanks.
Sara (Debt Camel) says
Yes they can chase for a CCJ after defaults drop off. Or sell the debt so a debt collector does. Not many loans go statute barred these days.
So I suggest you end them to the Ombudsman as even if there is only a small refund.
FOS will look at complaints about loans over 6 years if you have made your complaint within 3 years of finding out that the lender should have checked affordability.
Liam Attrill says
Hi Sara,
I would just like to say thank you again For your help. Today safety net credit upheld my complaint and have offered to refund my interest (£640) plus to remove any negative markers. 1 down. Thank you.
The money will be clearing the other default and into savings. Hope to have a similar outcome with provident/loans at home/Morses although, can see myself having to go to the FOS for them.
Thanks again – you are a saviour for many people.
Valentin says
Hi! I was just wondering, those credit card utilisation points, when do they kick in? And is it just a once in a lifetime thing? If so, how do you achieve a perfect score? Will taking a bunch of small loans help? If so, should they be done all at once or over a period of time? Everyone says “get a credit score and have low utilisation”, but how will that affect your credit score month to month? Because youre technically lending money every month, will it be a month by month increase of credit score?
Sara (Debt Camel) says
Taking a “bunch of small loans” is a silly idea – it will hit your score because taking out new credit always does. And if will be expensive because small loans usually have a higher interest rate.
Because youre technically lending money every month, will it be a month by month increase of credit score?
Yes. Your score is assessed every month. If this month you are using a lot more of your credit limit or a lot less, you score goes down or up accordingly.
So the way you improve your score is to reduce the balances on your credit cards, preferably to zero so you then repay them in full every month.
Liam Attrill says
Wow, I did not know that! Can’t believe I hadn’t come across that in the last 2-3 years.
Thanks, I will raise my complaint and forward to the ombudsman, along with my bank statements and credit report.
Rachel says
Hi Sara
I have updated my address on Experian and I found out that I have an old default on my Vodaphone account at closing. 5 years of on time direct debit payments and £20 default on the final bill. I called to discuss and after 5 hours on the phone Vodaphone could not locate this debt or account. I have raised a dispute with Experian and have not had a response.
The account closed September 2015 but the default is listed 8/3/2016. Would it be possible to have this changed to the actual date the account closed? Or any chance of removal?
I had an AIP approved with Barclays before I updated my linked address. Does this mean that I will be likely refused at application? Also do you think my chances of mortgage approval are now low? Should I wait to have this dropped off before applying?
Any help appreciated
Rachel
Sara (Debt Camel) says
A default when an account is between 3 and 6 months in arrears, so you probably can’t get the date changed.
If you thought the final bill has been repaid in full, your better bet is to argue that you were never told there was a debt, you thought you had repaid it in full and if Vodafone can’t produce any evidence you dispute that you ever owed them the money.
If you went through a mortgage broker, tell them about your situation immediately.
How large a % is your deposit? how much do you want to borrow? Is the rest of your credit record spotless? HAve you had any covid-19 payment breaks this year?
Tash says
Hi Rachel,
I just want to jump in to say that the exact same thing happened to me last year: £55 British Gas default (I never received the final bill back in Sept 2015 – it arrived after I moved out), default was dated Feb 2016… and discovered right in the middle of a mortgage application last year!)
I’m not a broker but wanted to reassure you (I had many sleepless nights and wish I could go back and say this to myself!) – that it didn’t cause any issues for me to get a mortgage approved. I may have received a slightly higher rate though (3.1% – I’ve no idea if this was good or bad, I was just grateful to have an offer to be honest!)
It’s scary, especially when it makes your “score” come crashing down – but I think as the default is a few years old the lenders will look at your whole history/file and so long as that’s the only big negative marker you should be fine. (Obviously and I’m sure Sara will point out that deposit and income, who you’re buying with and whatever else is on your file comes into play too, so no two situations are exactly the same. But I can reassure that for me, the default alone didn’t cause issues.)
I expect “human error/contractor admin mistakes/poor timing of final bill” defaults such as these are quite common – so banks must have some element of common sense to see who poses an actual risk of non-repayment.
Anyway, Good luck! :-)
Sara (Debt Camel) says
Lenders are being a lot fussier this year unless you have a very large deposit.
gurpreet says
Hi Sara,
Quickquid have accepted my claims for 11 out 12 loans.
The latest loan defaulted in 2018 and this is also been accepted. would this default be removed from my credit report.
this is my last remaining default, would this help my credit rating a great deal?
thank you
Sara (Debt Camel) says
yes they should remove that default and that could make a big difference to your credit score.
Wes says
Be really interested to hear your thoughts on the new Experian boost? Is there anything to be weary of? I notice it uses open banking and has access to my banking records for 90days – just wondering what that means in practise and if it’s safe!? But I guess more importantly, is it worth it!
Thanks
Sara (Debt Camel) says
Have to say I wouldn’t let them anywhere near my bank account.
The other thing to remember is that lenders do not use the Experian score you can see. they do their own calculations. Will they think you paying for netflix every month is good or foolish or perhaps they simply won’t care?
Martin says
I have a default with halifax for an overdraft dated feb 2017 so I have it on my record to 2023. I have other debts but this is the only default. As paying it off would not remove the default I made no payments at all and instead have concentrated on paying other debts to stop further defaults and to reduce my overall debt and save interest. However halifax also report a missed payment every month and its the only one on my file with missed payments.
Will my credit score improve if I contact them and arrange to start making payments or will the fact its defaulted mean this makes no difference?
Also about credit cards. I have 3 with varying interest rates, the highest rated one (aqua) is 40% and the lowest (vanquis chrome) is 27% so to save interest I have a much lower utilisation on my Aqua (still about 50%) and a higher utilisation on my vanquis (90%). it makes financial sense to do this as it saves money and allows me to clear my debt sooner. (my overall debt has gone down from about 25K three years ago to 16k now)
I feel annoyed that I am penalised for doing something that is actually financially prudent.
Sara (Debt Camel) says
However halifax also report a missed payment every month
are you sure there is a default date on your credit record? Normally when an account is defaulted, a missed payment isn’t recorded every month but another default.
The reason for making an arrangement to pay this account isn’t to improve your credit score but to stop the debt being sold to a debt collector who will take you to court for a CCJ, which will make your credit score much worse for another 6 years.
Are you using any of these three credit cards? Are you making more than the minimum payments to them?
Martin says
Yes it is registered as a default and also coming up each month on my missed payments on totally money. It’s classed as a negative on my file.
I do use the cards occasionally but tend to use the cheaper one. The higher one ive paid down from £1200 to nearly £600 and I make boosted payments on both.
I have raised complaint with Halifax as they gave me a £2850 overdraft when I was in a DMP due to gambling problems. The charges mean I paid more in overdraft charges than I borrowed and never could reduce it. It currently stands at £3260 with the charges up to the default date.
Sara (Debt Camel) says
To point out the obvious, the cards will be cleared quicked if you can stop using them. This is horribly expensive debt.
Martin says
Thanks Sara
I do totally agree but before I had payday loans and other high interest loans much more expensive than the credit cards so I paid more towards them and didn’t pay down my credit cards. I’ve now cleared all my payday loans and changed a 90%apr loan to a 34% apr loan so now I can start repaying the credit cards as the 40% one is my highest interest debt now. So I’ve been concentrating on this one hence the utilisation rate being lower on this.
Sara (Debt Camel) says
Have you made an affordability complaint about the 90% APR loan?
34% is still pretty horrific… is this genuinely affordable if you are having to use the credit cards?