A reader asked:
My Credit Karma report shows some settled debts but one is shown as satisfied. I am sure I paid them all off in full. Does it make a difference and should I ask for this to be changed?
What is the difference between Satisfied and Settled?
On credit records, debts which have been repaid in full are:
- shown as Satisfied if a default has been added to the record;
- shown as Settled if there is no default on the record.
On the report above, this is confirmed by the names of the creditors. Motormile Finance is a debt collector – this debt would have defaulted at some stage and then been sold to the debt collector. Provident and Quickbridge are lenders – there may have been late or missed payments on these two debts but no default was added. You can see the full repayment history for each debt by clicking on the purple plus sign.
There are now a large number of ways to look at your credit records and score. Some are free, some paying a one-off charge, others a monthly fee. Which one you should use depends on what sort of detail you want, see What’s the best way to check your credit record for details.
This is how Experian reports this situation. I’ve highlighted two loans, the defaulted one is marked Satisfied, the non defaulted one is marked as Settled:
A debt which has been closed with an agreed full and final settlement will be marked as Partially Settled or Partially Satisfied.
The difference matters, as it affects your score for different times
There is a big difference for your credit score in future:
- a settled debt will disappear from your credit record six years after the settlement date.
- a satisfied debt disappears sooner, as it drops off six years after the default debt.
If all payments were made on time, then a settled debt is great for your credit score. It shows you borrowed money and repaid it on time – just what future lenders like to see.
But if the settled debt has late payments or arrangements to pay markers, these are going to be showing on your credit record for a long while. If there are a lot of these and they started several years ago – perhaps you have been debt management? – then it may be better if you ask for a default to be added because it will go sooner! See What should the default date for a debt be? for more details.
Poor credit score & want a mortgage
Does a F&F affect your credit score?
Nathan says
Hi Sara
No not all of the debtors in the DMP are defaulted and I have spoken with satsuma and they have confirmed my accounts are not defaulted. Have always paid satsuma the agreed amount and not missed any payments.
Dates for any defaults are beginning of 2018, currently paying 195.00 per month towards my DMP but a few of the accounts on the DMP have been settled in the last few weeks
Sara (Debt Camel) says
so you will be better off if you can get Satsuma to add a default date back in 2018. If you settle when there is no default date, the record will remain on your credit file for another 6 years, settling in full or partially makes no difference the problems will continue to show for 6 years. but add a default in 2018 and in 20124 your credit record will be clean.
Nathan says
Hi Sara
But no default has been raised by satsuma, just that the account is open, so if I pay it will just be closed with a zero balance. I have asked them to remove the 6 month marker due to them in writing telling me that this wouldn’t be added in the 1st place, if I can get them to remove that marker would that be the best outcome.
Sara (Debt Camel) says
would it then say you were 5 months in arrears? If you can get them to change it so it shows you have not been in arrears at all, then that would be great for you but they probably won’t do it.
Nathanc@sky.com says
Thank you, I have emailed a complaint to them that they are looking at, too request that it’s removed as they stated in writing I wouldn’t have late payment markers added! Hopefully they will look into this.
I am going to clear the balance of today anyway and will then keep at them with the complaint.
I appreciate your help. 👍
Jade says
Hi Sara,
I’ve just checked my credit report and I can see a small debt with Barclays Bank for £169, it’s showing that the last missed payment for it was in September 2015. I’m looking to apply for a mortgage within the next 6 months with my partner, would I have a chance at doing so with this showing? Is it better now that I settle it or leave it? Would it drop off in September 2021 or the first missed payment date in December 2014, I think it must be from an old overdraft I had when working from them but I haven’t lived at the address they’ve sent letters to for years so have been unaware of it.
Any help would be appreciated,
Thank you
Sara (Debt Camel) says
So after 2015 there are no missed payments on this debt? That’s odd. It makes it hard to know what to do when it lookalike the lender has made a mistake.
Jade says
Hi Sara,
I’ve just double checked this. It definitely shows the last date for a missed payment in September 2015 after that there is no data up until 18 months ago where I’ve paid all credit consecutively. The gap between then is completely blank?
Sara (Debt Camel) says
well if there was one missed payment 5 years ago, a mortgage lender probably won’t see that as serious. But as it isn’t a default it won’t drop off in September 2021, it will stay for 6 years after you close the account.
Your options:
– ignore it and hope a mortgage lender doesn’t mind. if you want o do this then go through a mortgage broker not direct to a lender, but that is actually good advice for anyone getting a mortgage
– pay it now and close the account – and hope Barclays don’t look at it and decide you should have been defaulted years ago.
– contact Barclays and say you have just seen this on your credit record and is it some sort of error as you have never been contacted about it? (I am suggesting this as you don’t seem to know anything about whether you do owe the money or not….) say if it isn’t an error you are happy to pay it now but you would like your credit record corrected to show it was closed back in 2015.
It is hard to guess which is likely to work out for the best, sorry.
Adam says
Hi Sara, I’m a bit of a simpleton and I was hoping you could enlighten me! On 1 December 2015 I got a CCJ – I was unaware until 2018 when I checked my credit score (again, simpleton) and the debt was settled on 14 August 2018 / will this drop off my credit score 6 years from when it was issued or 6 years from when it was settled?
Hope you can help clear it up! :)
Sara (Debt Camel) says
6 years from when it was issued.
Rachel says
Hi, I am new to trying to understand and improve my credit report. I viewed my report in december, when i discovered that I have a CCJ on my report which i was unaware of. I googled what to do and contact the business court for the details. Following that I contacted the solicitor and have paid off the CCJ debt in full. I have just received a letter from the solicitor formally confirming receipt of the payment and that they have sent a ‘settled action report’ to the court. They also say that this means I am now ‘at liberty to apply to the county court for a certificate of satisfaction’.
I am not sure what this means and whether or not I need it. Will the status of the CCJ be updated on my credit report automatically? or do i need to manually request this? if i need the certificate, will it cost me anything to request the certificate?
Thanks
Weatherman says
Hi Rachel
If the solicitor has told the court that you’ve paid it, you don’t need to do anything. If you did want a certificate, it would cost you £14 (you need to fill out a form called N443: https://www.gov.uk/government/publications/form-n443-application-for-a-certificate-of-satisfaction-or-cancellation). But you don’t need it.
If you paid it within a month, it should vanish from your credit report. If the CCJ was more than a month ago, unfortunately it will stay on your report for six years.
There’s more information about all of this here: https://debtcamel.co.uk/paid-ccj-satisfied/
A Bradley says
A debt I defaulted on in 2016 was a personal loan for a hire purchase car which I took out in 2014. I wanted to voluntarily surrender my car, the loan firm were really unfair to me & never contacted me again to pick the car up. In Feb 2020 I suddenly received a letter from the personal loan firms paralegal team demanding full payment within 14 days – I contacted them saying they hadn’t contacted me and they ignored me for 4 years & that I couldn’t repay the full amount in 14 days and what was my options. I decided to go to the financial ombudsman service & they took over my case for 10 months, they mitigated & agreed it was misconduct. However the final result had to be impartial & basically the loan firm admitted they had lost me on their system hence why they didn’t respond or contact me for 4 years but I still owed the remainder and they offered me £50 compensation for stress. I didn’t accept this offer as I felt it was unreasonable and the financial ombudsman closed my case. Moving on 2 months from this (this month) and the loan firm has closed my account on my credit file and on credit checkers it says it’s now £0 and is satisfied/partially satisfied. I’ve checked on checkmyfile & it doesn’t show up as a mark on my credit score anymore and also says £0 satisfied. On one of my credit reports it says on my next report this account update will give me a positive impact on my credit score. What could this mean?
Sara (Debt Camel) says
If you carried on driving the car after you asked for a VT then I am not that surprised at the FOS decision. You should have insisted they pick up the car and complained within months if they didnt.
What was the balance on this account? What is the default date on it?
I have given up trying to interpret the wide variety of things the more than a dozen credit reports say about the future… You need to wait and see.
A Bradley says
I didn’t drive the car for 2 years from when I kept requesting a VT. I sent them letters, emails and calls & heard nothing back or was told someone would contact me. The balance on the account was £11K and default date was April 2016 so 6 years would be 2022. I then started to drive the car again in 2018 until 2020 (MOT backs all of this). This was all taken into consideration & they admitted I was on wrong systems & that’s why VT never happened etc.
Just unsure why they would update my credit file to £0 & satisfied or part-satisfied? I am worried to just wait & see as I have worked really hard to clear my other smaller debts & this is the only one that is left to deal with. As the 6 years is up next year I am worried to leave it – I just don’t know what I can do.
David says
Hello,
I have a good credit report apart from 1 closed credit file. It was a small loan that went into arrears in 2013. The account has fallen of all the main credit agencies other than Experian. It shows on Experian as a settled account on the 28/4/17. The means it will not drop off my Experian report until April 2023 even though the initial arrears started in 2013. This seems a little unfair as I am being basically being punished for a mistake for 10 years and not 6 years. Do you think it would be worthwhile speaking to the lender to see if they could turn the account into a defaulted account? We would like to move in around 12 months and I am trying to see if there are anyways to have this account removed?
Thanks
Sara (Debt Camel) says
The account has fallen of all the main credit agencies other than Experian.
So it used to show on other agencies? which?
David says
Thanks for the reply.
Yes, the account used to show on both Trans Union and Equifax in the closed accounts section. It no longer shows on these reports but does on my Experian report.
Sara (Debt Camel) says
A debt drops off 6 years after a default date. It sounds as though a default date was added to transUnion and Equifax records but mistakenly left of the Experian one. I suggest you contact the original creditor, explain this and ask for the same old default date to be added to the Experian record, which should mean it then drops off.
David says
Hi Sara,
Thanks so much for the information. I will certainly do this. It has been frustrating me for over a year and I appreciate the advice.
Thanks you.
David says
Just an update to my above post.
I have spoken to both the lender and Experian on numerous occasions regarding this and am told the information Experian report is correct. This morning I received the below reply from Experian.
—————
“They’ve confirmed default is not showing and the late payments are accurate, so we don’t have permission to amend or delete this entry on your credit report. They have provided the following response to the dispute we raised on your behalf.”
“We have checked the CRA records, On Experian account shows settled as 28/04/17 also missed/late payment markers shown. Therefore Please request the customer to contact us direct to discuss.” I do understand this is not the outcome you were hoping for, therefore, if you’d like to discuss their decision, you can contact them directly using the following contact details.
—————
I have spoken again to the lender this morning, and they said the information supplied to all 3 credit agencies is identical, so I am not sure why it still only remains on Experian. I’m not sure if it is worth contacting them again and asking for a new default date to be added. They probably wouldn’t do this, and my concern is that they would add the default date in replacement to the settlement date in 2017 and not when the account hit arrears in 2013. All very frustrating. I guess I will just have to wait until 2023 for it to drop off.
Thanks
David says
Further Update – Having written one final letter to the lender. I stressed how I felt I was being unfairly treated as the settled account meant it would have a negative impact on my credit file for 10 years. I asked for a backdated default date to be applied as I was more disadvantaged compared to someone who chose not to pay any of their debt at all.
Good News – They have now removed the credit report from my credit file and also paid a generous amount of compensation. This has dragged on for around two years and badly affected my credit. However, thanks to Sara’s initial advice, it made me more determined than ever to get to the bottom of things.
Sorry to bore you all with this, but I feel it’s worth mentioning to let people know that it is possible to have a backdated default date added to settled accounts if it means it will leave you credit file quicker. Thanks.
Sara (Debt Camel) says
Good news is never boring! Well persevered.
Ewan says
Sara
I had a question about defaults.
I had credit card defaulted in 2019 and have paid the remaining amount by June this year and have a letter from the bank saying the account is now closed and satisfied. On my Experian account I shows the defaulted account as zero. But on my credit cards it still shows as active with 13800 limit and 9750 on the account.
Will this remain the same for 6 years or will it drop off in the next few weeks . I’m trying to remortgage on my own and was waiting to see If this would drop of my report just leaving the history of a default.
Sara (Debt Camel) says
But on my credit cards it still shows as active with 13800 limit and 9750 on the account.
Where is this showing – when you log into the credit card account? Or on an Experian report? Has the debt been sold to a debt collector?
Have you also checked your Equifax and TransUnion reports? See https://debtcamel.co.uk/best-way-to-check-credit-score/ for how to do this.
Ewan says
Sarah
Thanks for getting back on Experian paid subscription I have active accounts this card is on then settled accounts then default accounts this card is shown zero balance.
The debt has not been sold and has been paid by June. On my free credit karma account it’s not shown or default.
Reading on the other comments on your page if I just settled the account in June would the active card disappear or stay for 6 years just Leaving the default.
Would I be able to remortgage on my own remove a person off on current variable rate 3.59 to a better deal. mortage left at 190k and house value 360k
Sara (Debt Camel) says
I don’t understand what you can see on the Experian report. The debt should show as settled or satisfied, with a zero balance. If it doesn’t, something is wrong.
What is your income?
Ewan says
Thanks it still shows as an active account at the sum it was default at probably,my question was it there a delay from Experian if only June it was settled. My income is 45 plus 3k bonus average. Default was March 2019
Sara (Debt Camel) says
lenders normally report to CRAs monthly. The delay is more likely to be at the lender and than experian, but you can ask experian. It seems off that you say
On my Experian account I shows the defaulted account as zero. But on my credit cards it still shows as active with 13800 limit and 9750 on the account.
But regardless of this, you may have problems remortgaging with a recently settled default on your credit record. You need a loan of more than 3 times your income – that’s not impossib0le but your lender may prefer to have your ex on the mortgage as additional security… and if you try to remortgage with a different lender they will not like the recently settled default.
Rob says
If the bank offer to pay off the whole debt for a customer, and the debt hasn’t defaulted and isn’t in arrears, I believe that would be a settled account and not a partially settled account? Would I be right in my understanding please?
Sara (Debt Camel) says
why have they offered to clear the debt? How the bank records this may well depend on the reason.
Rob says
It was part of the outcome of a customer complaint I made as they treated me really badly (discriminated against me)
Sara (Debt Camel) says
Then I think you should check with them that they will either be marking the record as settled (not partially settled) or deleting it.
Rob says
Thank you. Do you know where I can find the official definition and rules around settled vs partially settled so I can quote them in my letter to show why it shouldn’t be shown as partially settled please ?
Sara (Debt Camel) says
There are no official definitions… this is all custom & practice.
In your case you should point out that it is not fair that your credit record should be harmed with having a partial settlement recorded when the bank has accepted that there was a problem on its part. If the bank doesn’t accept this, then you can send the complaint to the Financial Ombudsman.
But I would start with a neutral query. There is no need to gear up for a battle that may not need to be fought – you don’t know what the bank is planning to do.
Rob says
I think it’s going to be an ombudsman case as they already have refused to budge when I complained 😭. They’re being stubborn with me.
Ed says
Hi Sara,
I have just discovered a missed payment from almost 6 years ago (telecomms) on my credit file. I was a customer with the company until 2 years ago and have not been contacted once around any missed payment. I’m in the process of disputing this information but would like to make sure I’ve understood the difference between settled and satisfied accounts.
The account is showing as active and not defaulted. Am I correct in my understanding that if I were to pay in full that would result in a settled account and a further 6 years of missed payments being shown on my credit file?
If so, what are my options? If I don’t pay then will the active account continue to be shown but without the missed payments past the 6 year mark? Or will they continue to be shown since the account is active?
Thank you for any help you can provide!
Sara (Debt Camel) says
The account is showing as active and not defaulted. Am I correct in my understanding that if I were to pay in full that would result in a settled account and a further 6 years of missed payments being shown on my credit file?
The account would show as settled. No more missed payments will be recorded after the settlement, but the previous ones will continue to show for the next 6 years.
If I don’t pay then will the active account continue to be shown but without the missed payments past the 6 year mark?
If you don’t pay then missed payments will continue to be added every month and the account will stay like that permanently.
To point out the obvious, this is a very old account and it is surprising that you have never been asked to pay this. If the creditor cannot provide any information about the debt you should say you dispute it and ask them to remove it from your credit record.
Ed says
Thanks so much for the reply Sara.
Your article was the clearest of the literally hundreds of articles I have read over the past couple of days.
I appreciate that my issue is probably unusual and I have raised a dispute with the company, but with a remortgage application on the horizon I am keen to resolve this issue as quickly as possible and have seen from online searches how lengthy disputes can be.
My gut instinct was to not dispute and just pay (the debt is showing at just over £100), but am relieved I didn’t as that would have prolonged the issue.
With that in mind, would you recommend I ask the company to default my account? Is the default date always set to the date of the first missed payment? If so, then all details of the account would be removed at the 6 years post first missed payment wouldn’t they?
Thanks again – I have been going around in circles with this for days and have found very little guidance online!
Sara (Debt Camel) says
Have they actually produced any evidence about this alleged default?
Ed says
Not as yet – I only submitted the form to the company yesterday. The credit agency also contacted them, but they will allegedly get back to me quicker (within 7 working days), although their customer service is renowned for being poor!
Sara (Debt Camel) says
credit agencies are useless they will just ask the company.
I know you want to get this sorted but asking for a default to be added will mean it is probably added 3-6 months after the first missed payment. Which will mean your credit record continues to be poor for some time. And they may ask you to pay it.
The fact you were a customer of the company for several years after the alleged missed payments started suggests there is something wrong with their records. Asking for it to be deleted seems a better route to me (although with credit records this is more of an art than a science…)
Ed says
That’s great, thanks Sara.
I will sit tight until the company have looked into this and then go from there.
Thanks again for your help, much appreciated. It has been refreshing discussing the issue with someone that actually understands!