Why has my credit file got a marker on it? - Gareth Shaw

Dear Gareth, I used to make minimum repayments on my credit card, but recently changed my direct debit via online banking to pay off the balance in full each month. The next thing I heard from my provider was that I had missed this payment and a marker had been applied to my credit file. What’s going on?

Having an accurate credit report is critical to you getting the financial products you want.

Gareth says…

Having an accurate credit report is critical to you getting the financial products you want. Your credit report is a history of your financial relationships and is used by mortgage lenders and credit card companies to make decisions as to whether or not to lend to you.

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Any blemish on your record might indicate that you’ve had problems paying in the past and therefore may put a lender off making you a customer, or charge you a higher rate of interest or offer you a less attractive deal because you pose a greater risk.

You might feel like one indication of a missed payment might be the death knell for future credit applications, and while it sounds like you have good grounds to challenge this, try not to panic too much about a single missed payment on your credit report. If you have a genuinely good history of making repayments on credit cards, loans, mortgages and other products like mobile phone contracts and car insurance, one anomalous missed payment amid a history of paying on term shouldn’t be too damaging.

If you’re about to make a credit application, say by remortgaging, inform your broker or adviser that you currently have a dispute with a credit provider – being upfront about the missed payment will help to provide context for the lender and inform its decision-making.

You explained to me in a follow up email that your credit card company told you it can take 30 days to amend a direct debit and it seems it wasn’t amended by the payment due date. This meant no payment was taken and so a missed payment was recorded. Between the old direct debit being cancelled and the new one being set up, you may have been required to make a manual payment – but this should have been made clear to you by your provider.

I think you should make a formal complaint to your credit card provider, demanding that they remove the missed repayment from your credit record. It has to resolve this in eight weeks, and if you’re unsatisfied with the outcome, you can escalate your complaint to the Financial Ombudsman Service, which mediates disputes between regulated financial firms and consumers.

If your complaint is upheld, your credit card provider should refund any penalty fees and remove the missed payment from your credit file.

But you don’t need to sit around for two months to take further action. You can find out which credit reference agencies your credit card provider reports to and inform them that you believe a mistake has been made on your file. It will investigate it on your behalf. The three main credit reference agencies are Equifax, Experian and TransUnion. By law, your credit report should be accurate, so lenders and credit reference agencies have up to 28 days to respond to a dispute. One credit reference agency, Experian, told us that it usually resolves issues in less than two weeks.

Gareth Shaw is head of money at which.co.uk.

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