Understand What A Default Is And How It Is Found Find Out About Loan & Mortgage Products That Accept Defaults Some Options If You Have Been Mistakenly Given A Default Help To Raise Money To Clear Defaults And CCJ`s
Defaults cause problems when you want to take out a loan, mortgage or any other credit. But there are lending plans to help you even with defaults. First Choice Finance can help you raise money as through our 25 years experience in the UK loan market we have an understanding of what your options are and how you can use them. But to avoid getting further defaults down the line you firstly need to understand what a default is, only then can you be expected to know how to avoid getting one in the future. If you have been declined for finance and believe or have been told it is due to defaults then you can use our short on line enquiry form to tell us what you need and we will work with you to get the funds from our selection of loan solutions, alternatively give our in house finance team a call on 0800 298 3000 or 0333 003 1505 (mobile friendly) and they will talk through your specific requirement in confidence and without any obligation to proceed with any solution we propose.
Definition Of A Default
By the virtue of you reading this page you have either been told first hand that you have a default or have heard about them causing issues with regard to obtaining credit. When you enter into a credit agreement with a lender a legal contract is formed between you as the borrower and the company advancing you the money or credit facility, the creditor.. In that contract you will have agreed to make certain payments to the creditor on a time line that you have pre agreed with them before you took our the loan, mortgage, revolving credit facility (such as a credit card) or any other type of finance. Your commitment within the contract and the implications of not keeping to it will vary quite dramatically based on the type of finance you have taken out, the lender you have borrowed from and how poor your conduct of the credit agreement is. If you fall significantly behind on your repayments, for example 4 or 5 months on a loan or credit card then the lender / creditor will possibly contact you and advise you that you have DEFAULTED on your contract with them and that they wish to seek full recovery of the money you still owe within a short time frame.
How Do Companies Know That You Have A Default?
This is a very interesting and critically important aspect to understand with regard to your conduct of any sort of credit account, even things like car HP. You may have heard of credit reference agencies, but just in case you have not these are the companies who record an individual consumer`s conduct of their credit items. The main known ones are Equifax, Experian and Call Credit. Now to be able to record your credit performance the creditors, such as banks, building societies, mortgage providers etc pass information about your payments under the credit contract to the reference agencies. Just about all creditors do this and because they provide information into the reference arena then they are able to view other entries on a potential consumers credit file, provided they have your consent to do a ``credit search`` of course.
Therefore once you are in default on a loan, mortgage or credit item the lender with pass that information onto the reference agency including matters such as how much you still owe to them and the date that you defaulted on the contract. So when you then go and apply for a loan, credit card, store card or even a bank account the company you approach will normally insist that you allow them to do a credit search on you to find out how you conduct your credit. They then see that you have a default and depending on their specific lending criteria they may refuse you. The default will often stay on your credit record for at least 4 years. You can of course try to make reparations, one way to do this is to contact the creditor in question, establish a settlement figure and pay that sum to them with an agreement that they will show the default as satisfied so long as it is still on your credit record until it drops off. That at least will mitigate the damage.
Not Aware Of Any Default But Advised When Refused I Have One
As we all know technology is not perfect and mistakes inevitably can and will happen. If you are refused credit and are told it is because of defaults think about what credit commitments you have had over the last 10 years. Things to consider are:
Did you perhaps take out a joint current account with an overdraft with a now ex-partner and are not aware of its current conduct? Joint borrowers take joint risks when it comes to credit
Have you had issues at a previous address or that you thought were resolved but did not get final correspondence and therefore do not know if any damage was or is being done to your credit record
Do you have the same name as someone else in your house or who used to live in your house? This is unlikely to cause issues as credit is related to your name, address and date of birth so difficult to confuse but it is a slim possibility
Have you been a guarantor for a loan that someone else took out, if so if they fall behind and you do not meet the repayments for them on time then your credit file is affected and a default could be registered.
Could you be a victim of financial crime? Have you received letters talking about cards or loans that you have never taken out. In this instance you will need to get the police involved as well as dealing with all the creditors who have been used by the fraudster
There are lots of other things to look into but a good first step is to actually see for yourself what is on your credit record. That way you can identify items you know (or don`t!) and check that all is on order. You can do this by writing to the credit reference agencies and we have some addresses for you if you click Credit Reference Agencies . There are online tools too but beware of being tied into any lengthy expensive contracts.
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