Can the same debt be defaulted twice? Quick Answer

Are you wondering if the same debt can be defaulted twice? You’ve come to the right place for answers! Each month, over 170,000 people visit our website to understand debt problems just like this one.

In this article, we’ll show you:

•  What a defaulted debt means
•  If a debt can be defaulted twice
•  How an old debt might show up in your credit report
•  Steps you can take if you’re struggling with debt

We know that dealing with debt can be hard; some of us have been there too. But don’t worry! We’re here to help you understand your debt situation better.

Is it possible to happen?

There are many reports across the internet about people having the same debt defaulted twice. Can this really be done though?

The short answer is yes and no.

You cannot have two defaults for the same debt. What sometimes happens in these cases is that the original creditor defaults your account and passes the debt on to a debt collection agency.

» TAKE ACTION NOW: Fill out the short debt form

So, if you fail to meet the criteria set out for you by the debt collection agency, they might default your account as well.

In this case, Barclays sold the debt to PRA Group, but both companies reported the same default to a CRA.

Usually, the original entry will be replaced by the new owner’s entry, but this does not always happen, and you can end up with two entries which give the impression of two defaults.

Remember, a default will appear on your credit report for six years.

Can an old debt reappear on your credit report UK?

It is unlikely that an old debt will reappear on your credit report, but it is possible.

For example, if your debt defaulted over 6 years ago, but you have made at least one payment within 6 years, a CCJ could be issued against you.

As a result, the debt would reappear on your record.

Double default

While technically and legally, you should only be able to get one default per debt, what can happen here is the original creditor marks their entry as ‘closed’ or ‘settled’ and then they sell it on to a debt collection agency.

Once this happens, the agency will make its own entry, and it should note the default on the account.

It’s quite often thought to be a tactic used by the debt collection industry, where they immediately default any account as soon as they get hold of it.

Unfortunately, there aren’t any rules preventing it, despite it being quite an unfair thing to do.

The next steps

When you get a defaulted debt, and your account goes into default, your creditor will usually ask you to pay the full amount of the debt instead of the previously agreed instalments.

You have every right to ask to pay back in instalments, but the creditor may not agree to this.

The further action that a creditor can take against you after your account has been defaulted can involve:

• Passing the debt on to a debt collection agency,
• Taking court action against you and,
• If the debt was a ‘hire purchase’, they can apply to the court to take back the goods under said purchase.

You can find lots of useful information by checking this default guide made by the Financial Conduct Authority.

Sometimes creditors include a copy of the default notice when notifying you of your defaulted account.

Thousands have already tackled their debt

Every day our partners, The Debt Advice Service, help people find out whether they can lower their repayments and finally tackle or write off some of their debt.

Natasha

I’d recommend this firm to anyone struggling with debt – my mind has been put to rest, all is getting sorted.

Get started

Reviews shown are for The Debt Advice Service.