Aug/091
Problems Getting Credit? Remove a Default from your Credit Report
There are 3 ways in which you can repair your credit rating to achieve the ultimate result of getting that car or mortgage that you really need. These options are as follows:
1. If your default/delinquent balance is over £300 you should write to the bank in question to claim that you did not receive a notice letter of the bank’s intention to serve you with a default. It helps if you have actually got the letters of correspondence to refer to in your argument but don’t worry if you do not.
2. If your default/delinquent balance is under £300 you should take a softly softly approach and politely ask the bank or financial organisation to remove the default from your report. Use the angle that you feel it is extremely harsh and that you are struggling to provide a good life for yourself and family because you cannot get a mortgage or loan to pay for necessities.
3. Finally, if you have exhausted all possibilities and have written and replied to all letters sent to you, the only choice left is for you to start a programme of repair for your report. This isn’t 100% effectively but it does leave plenty of consumers happy. This basically involves starting up credit agreements where possible (if needed anyway of course) and settling existing agreements in the proper way (avoid early termination arrangements).
Default balance over £300
This is a fairly significant amount of money and if you put yourself in the bank’s shoes for a second you will realise that – unless a genuine mistake was made – this boils down to theft. This is basically why banks take a tough stance over this and throw defaults around like grains of sand. However, if the banks do not take the proper course of action in serving you with a default then they are robbing YOU in the sense that you are unable to purchase a house for example. That is why their practice needs to be scrutinised in the same way as your credit report is search.
Ask the bank if they can prove that a letter warning of a default was sent to the registered address before the default arrived on your credit report. After 2006 the banks tightened things up quite substantially but before this time their operations were quite unprofessional and filled with ambiguity. The bank should then respond to your letter with a reply – probably a standard template reply – but never the less you have you starting point.
From this point you can keep replying until they send you proof that a notice was served and also that the agreement that you entered into is enforceable. At that point you can give up and take the emergency repair steps for improving your credit report.
Default balance under £300
Most success stories in writing off defaults are usually found in cases where the amount is much smaller. This is because the agreements tend to be of a more trivial nature such as mobile hone contracts etc. Having a mobile phone and forgetting to cancel the contract after the 12month period (which you made payments for without problems) should not prevent you from buying a family home. Okay, so this is an extreme example but one which we have heard on more than one occasion.
Be nice, be polite, get to the point, don’t waffle, address it to the bottom of the company pyramid and work your way up until you get a reply from the very top. Hopefully by this point you will have received a positive response but if not following the following last resort to repair your credit rating.
Repair your Credit Rating
Your credit rating is key to a progressive life. Without a good credit rating you will get nowhere unless you are already there – if that makes any sense! You need to make sure it is as immaculate as it can be and no matter what the state of the economy (eg. If there is a credit crunch of any description) you can assure the financial establishments that their money is safe with you.
Step 1
Open an account similar to the Natwest Step account which offers you the opportunity to open a basic account and as you prove your worthiness of managing your account they will offer you debit card, then an overdraft, then an overdraft extension, etc. etc. such progression looks very good on your credit profile.
Step 2
Be smart, realise that a credit card is being used here for a very specific purpose and is not meant for borrowing money over many months or even years. Do not use it as an alternative to a loan.
Step 3
Do not buy a load of new gadgets. Instead buy 1 or 2 and get credit for them choosing to pay the balance over as long a period of time as possible. The more small agreements you have over long periods the better.
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