QUESTIONS AND ANSWERS

Dear Mehboob,

A default notice is a communication a lender should usually send to a borrower before defaulting a credit agreement regulated by the Consumer Credit Act (CCA). It warns the borrower that a default will occur unless remedial action is taken within a specific period of time, and that a record of the default will be registered on the borrower’s credit report with one or more credit reference agencies. So it isn’t the actual default notice that is registered on your credit report, just a record of the fact that your account has defaulted. Quite a few organisations that share customer information through the credit reference agencies are not covered by the CCA so don’t issue default notices at all. Mobile phone agreements are an example. Usually, though, you should still be told before a default is placed on your credit report and, if possible, given the opportunity to get your account back into order. If you disagree with information on your report – whether it has been registered as a default or any other status – you should raise a dispute. You can do this by contacting the credit provider direct or by asking the credit reference agency to contact them on your behalf. If you opt for the latter, the agency will add a note to your credit report to make it clear that the accuracy of the entry has been questioned. If the credit provider agrees to change the entry, they should send updates to any credit reference agencies they use. If they refuse to change it, you can add a notice of correction to your credit report to explain your side of the story. A notice of correction is a written statement of up to 200 words that you can send to us to include alongside your report. You can also escalate your dispute to a third party arbitrator, such as the Information Commissioner’s Office, if you believe incorrect information is being stored about you. If this becomes necessary we can give you advice on your best course of action.