How to Get a Default Removed from your Credit File?
For free & impartial money advice you can visit MoneyHelper. We work with The Debt Advice Service who provide information about your options. This isn’t a full fact-find, some debt solutions may not be suitable in all circumstances, ongoing fees might apply & your credit rating may be affected.
For free & impartial money advice you can visit MoneyHelper. We work with The Debt Advice Service who provide information about your options. This isn’t a full fact-find, some debt solutions may not be suitable in all circumstances, ongoing fees might apply & your credit rating may be affected.
If you’re worried about a default on your credit file, you’re not alone. Many people face this issue and are eager to find ways to remove it. In fact, over 170,000 people visit our website each month seeking advice on debt solutions, just like you.
In this article, we’ll cover:
- What a default notice is and when it can be counted as a default.
- How a default affects your credit score and when it can be removed.
- How to improve your credit score after a default.
- The effect of a default on your ability to get a mortgage or a job.
- Ways in which you can write off some of your debt.
Our team understands the stress and worry that comes with having a default on your credit file; some of us have experienced it too, and we’re here to help you.
So, let’s explore together how to get a default removed from your credit file.
Can You ask a company to remove a default?
Yes, there are times when you can ask creditors to remove a default.
Common reasons to make this request are administration errors causing mistaken identity or when you contest the default. You can learn the ways you could contest the default further below.
However, if there is no way to get your default removed and your debt problems are starting to pile up, you can still find a way out of debt. The UK offers several debt solutions, one of which might suit your situation.
When can it be removed?
There are two main ways a default can be removed from your credit file:
- There has been an error
- Sufficient time has passed
Default on credit report error
It’s important to check your account because errors do occur. If you see a defaulted debt or missed payment on your credit file that you are sure is a mistake or you want to contest, first you should bring the matter up with the lender that placed it there (not the credit reference agencies).
For example, if it’s a missed mobile phone contract bill, then you should bring it up with your mobile network provider first.
Reasons to argue a case include:
- The lender didn’t try to collect the payments
- Mistaken identity and admin errors
- You were in arrears by fewer than three months
- Duplicate defaults (usually added a second time by a debt collector)
- The debt was Statute Barred
If they do not agree to remove it for whatever reason, you can then ask the credit reference agencies to do it for you – providing evidence of the mistake.
Removing a default from your credit report can be a tiresome process and you may want the help of Step Change or Citizens Advice as you go through the process.
How a debt solution could help
Some debt solutions can:
- Stop nasty calls from creditors
- Freeze interest and charges
- Reduce your monthly payments
A few debt solutions can even result in writing off some of your debt.
Here’s an example:
Situation
Monthly income | £2,504 |
Monthly expenses | £2,345 |
Total debt | £32,049 |
Monthly debt repayments
Before | £587 |
After | £158 |
£429 reduction in monthly payments
If you want to learn what debt solutions are available to you, click the button below to get started.
Sufficient time has passed
Defaults will only stay on your credit file for six years from the date it was added. Once these six years have passed, the default will automatically be deleted. This is known as a Statute Barred Debt and the six-year countdown begins from the day that the default is recorded.
If you catch up with your monthly payment, the default still won’t be removed until the six years have elapsed.
If the default was added later than it should have been, you could ask for it to be adjusted so it falls off your credit report at an earlier date.
A note on British Gas default removal
A number of people have recently been made aware of a British Gas default on their credit file. However, these defaults are appearing, or re-appearing, up to 7 years after a missed payment.
If this has happened to you, you should make a complaint directly to British Gas. The basis for your complaint could be one or more of the following four points:
- You dispute the default because you have never heard about the debt before.
- You dispute the default because you have already notified British Gas that the bill was incorrect.
- You dispute the default because the debt is statute-barred.
- You dispute the default because it doesn’t satisfy ICO guidelines.
» TAKE ACTION NOW: Fill out the short debt form
What counts as a default?
A default is any missed payment on any money that you have borrowed.
This can include just one missed payment or several, and can apply to anything from your mortgage to your credit card bill.
A missed payment becomes a default once your lender has decided to close your account. Keep in mind that the threshold when missed payments becomes a default will vary by lender, but your lender will explain their terms in their contract.
For some lenders, it can be one payment, but usually a default occurs after a specified number of months.
Keep in mind that a creditor can’t list a consumer twice for a defaulted debt.
Consider a debt solution!
You don’t have to agree on a repayment plan directly with your creditor. There are alternative debt solutions available that could help you get out of debt cheaper and/or quicker.
There’s something for all situations, such as:
- Debt Management Plans
- Debt Relief Orders
- Individual Voluntary Arrangements
- Debt Consolidation
- Bankruptcy
Some of the above can be organised for free by contacting a charity, or you may need to engage paid-for services of a debt management company.
» TAKE ACTION NOW: Fill out the short debt form
Can I suppress a default?
In situations where the creditor has gone bust and they no longer respond to your or the credit reference website’s request, you can then ask those credit reference agencies to suppress the default.
Although this technically doesn’t delete any related defaults from your credit file, it does hide them when lenders complete a credit check, improving your chances of securing a loan or other credit. They will no longer see that you have a default or owe money that remains unpaid.
It is crucial that you only try this once the lender has gone bust.
Can you pay to clear your credit history?
No, you might come across adverts and websites for “Credit Repair Companies” or “Credit Fixers.”
Making payments to these companies is not worthwhile. It’s best to keep your money in your pocket and avoid all of these businesses. None of them have a secret loophole to get credit reference agencies to delete defaults and debt. All they do is provide information and services that you can do yourself.
Does your credit score go up?
When a default is registered on your credit report, it reduces your score. Thus, once a default is removed, no matter why it was removed, your score will increase.
But having a default removed is not the only thing you need to consider to improve your credit score. You can build it up in other ways.
You should also keep in mind that the negative impact of having a default will dwindle as time goes on. Lenders will put less scrutiny on a default on a credit report from five years ago than they will one that was added last month. In this way, the default date is vital and the longer you can go without defaulting on any other payments the better your credit rating will get.
However, credit scores are calculated using complicated systems and look at a number of factors. This can mean that your credit score will may not increase as much as you think it will after your default has been removed.
You will often need to use positive credit behaviours to get your credit score increased.
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Improve your credit score after default
If you have had a default and are having no good luck getting it removed, you can always concentrate on improving your credit score in other ways.
From our experience, these are some of the best forms of credit repair:
#1: Check for other credit report errors
When you log on to Experian or one of the other credit reference agencies, don’t just look for default errors. There could be many other types of errors on your credit file, such as an outstanding CCJ or maybe a credit card you never knew you still had.
#2: Register to vote
Simply by adding your name to the electoral register you can increase your chances of securing credit. It allows lenders to verify your identity easier and can subtly improve your credit rating. You can register to vote online or by sending a letter.
#3: Is your credit file linked?
Your credit file may be linked to someone else’s, possibly an ex-partner or someone with bad credit. If it is and they have a negative credit score, your own credit file will be suffering too.
You probably split the furniture, but have you split your credit report yet?
#4: Reduce your credit utilisation
Striking a balance between borrowing and using what you have been given is crucial. The technical name for this is your credit utilisation, i.e. how much of your credit are you utilising. Try to keep it low and around 30% at any one time.
#5: Move less
You can still grab your running shoes; what we mean by move less is move home less often. Creditors feel comfortable when you appear to be settled and do not up and move frequently.
They believe your financial situation is more stable when you stay put!
Can it stop you from getting a mortgage?
There’s no doubt that having a default can make it harder to secure a mortgage, but it is your overall credit score and history that will determine if you can secure a mortgage or not.
During your application, it is always better to be open and honest about any previous defaults. It’s not impossible to get a mortgage if you have defaulted accounts or bad credit history. Options like bad credit mortgages exist and specialist mortgage lenders who work with people with bad credit.
We’ve also covered how credit card debt affects a mortgage application!
Can your employer see it?
Generally, no, employers cannot see if you have any defaults.
Employers will be able to see if you have any record in public data. This means that any County Court Judgements (CCJs) and bankruptcies that you have will be flagged.
If your employer asks to run a full credit check on you, they will be able to see any defaults that you have.
But don’t worry! Aside from credit reference agencies and lenders, few employers request a full credit check from their employees.