How Did I Obtain A Default On My Credit File?

When you are unable to make a payment on a loan or credit card, the lender may report this to credit bureaus as a default. A default on your credit file can have a big impact on your ability to borrow money in the future, so it is important to understand how and why this may happen. In this article, we will explain what leads to a default and what you can do if it happens.

The report is intended to reveal your credit score and help you figure out where the problem may lie. The data provided by a credit provider will show up on your credit report, including whether you have made payments on time or missed any payments. Your oldest missed payment has a number (from 0 to 7) assigned to it, indicating how long ago it was made. This information stays on your credit report for two years.

If you make the payment more than 14 days after the due date, you are considered to have missed a payment. A credit provider is not required to provide you with a written notification before including a missed payment on your credit report.

A default on your credit report can be recorded by a credit provider if:

• A payment that is overdue for at least 60 days.
• The overdue payment is equal to or more than $150.
• A notice has been sent to your last known address to let you know about the overdue payment and requesting payment.
• A second notice was sent at least 30 days later to let you know that if you don’t make a payment the credit provider intends to disclose the information to a credit reporting body.
• The credit provider must wait at least 14 days after issuing the second notice before listing the default. If you have any questions about this process, or if you believe that a default has been incorrectly listed on your report, you should contact the credit provider directly. Additionally, you can also get in touch with a credit reporting body such as Equifax or Experian, who will be able to provide further information about the listing.

A credit agency can’t wait more than three months after sending you the second notice to list your default.

If you do not receive the required notification from a credit provider, it will be considered that they have met the notification requirements if they can show that notice was sent to your most recent address. They may send notifications by email if that is how they usually communicate with you.

If you received a credit report, notice of adverse action (NOA), or other warning from a credit provider to an address that is no longer your current residence, the listing may not be valid. However, if they sent the notifications to an old address because you neglected to change your contact information, the credit provider has likely fulfilled the notification obligations.

If you made the payment after it was designated as a default by the credit provider, your record will show that you paid the debt, but the listing will be updated to reflect this.

If you have found yourself in a situation where you have received a default on your credit file, don’t panic. The credit repair team at Clear Credit Solutions is here to help. We specialize in removing defaults, court judgments and fraudulent enquiries from credit files so that you can get back on track with your financial future.