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Factsheet | Credit Reference Agencies

What is a credit reference agency?

Credit reference agencies hold information about your credit agreements (including any arrears), county court judgments (CCJs) and electoral roll information. A lender can only pass on information about your credit agreements with your consent. You usually give this consent when you sign the credit agreement. Failure to obtain your consent is a breach of the Data Protection Act 1998.

County court judgments will automatically be registered and are kept on record for period of six years. The information a credit reference agency hold about you is known as your credit report (or file).

Information

Credit reference agencies provide factual information with your consent, so that a company can make a decision about whether to lend you money. They do not have a ‘blacklist’ of people who should not be given credit.

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Credit scoring

When being considered for credit, a lender may also take into account factors such as your age, occupation and whether you are a homeowner, (the information you give them on your credit application). Lenders often assess this information and the information on your credit report using a process known as credit scoring (see below). They will also take into account whether you are on the electoral register. This may be an important part of the lender deciding whether to give you credit.

Information

You can apply to go on the electoral register at any time of the year. Contact your local council for further assistance. You should make sure you fill in the electoral registration form sent out in September or contact your local council if you move at any time in the year.

The lender may give points to each piece of information it has and then add them up to give you a credit score. If you do not score above the particular company’s pass level then you may well be turned down. The score might take into account the information on your credit report. Each lender has their own policy guidelines that they follow when making lending decisions.

Every time you apply for credit a ‘search’ by the lender is marked on your credit report. Searches stay on your file for different times depending upon which credit reference agency was used. Experian holds search entries for 12 months, Equifax and Callcredit for up to 24 months.

Ask the lender if they are using a credit score to decide whether to give you credit. If the company uses a computerised system you should be given broad information about how credit scoring works and the type of things they have taken into account in the scoring system for that company. If you are turned down they should tell you if you didn’t pass. They should also tell you if you were turned down for any other reason, for example, because of the information held on your credit report.

Information

If the decision was made solely using a computerised scoring system you can ask the lender to look at your application again. This review should be done manually and not using an automated system. You may have to supply extra information to support your application.

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What do I do if I have been refused credit?

If you have been refused credit, then you should ask the lender which credit reference agency was consulted and whether the credit reference agency's information was the reason for the decision. You can contact this agency and ask for a copy of your credit report under the Data Protection Act 1998. This costs £2 by letter or over the internet and £3.50 by telephone from Experian. The agency will require your full name, current address, date of birth and any previous addresses that you have lived at for the past six years. Your report should be sent to you within seven working days unless the agency needs you to send proof of your identity, for example, if you have moved home recently. If the information is incorrect then you have a right to ask the agency to remove or correct the information.

Advice

The Information Commission publishes a booklet called ‘Credit explained’. If you have not yet had a copy, phone us for advice.

There are three main credit reference agencies, Experian, Equifax and Callcredit plc. You should check information held by all these agencies as some information may be different.

Experian Ltd
Consumer Help Service
PO Box 8000
Nottingham
NG80 7WF
Tel: 0844 481 8000
www.experian.co.uk
(You can also order your credit report on the internet or by telephone.)

Equifax plc
Credit File Advice Centre
PO Box 1140
Bradford
BD1 5US
Tel: 0844 335 0550
www.equifax.co.uk
(You can also order your credit report on the internet.)

Callcredit Ltd
Consumer Services Team
PO Box 491
Leeds
LS3 1WZ
Tel: 0870 060 1414
www.callcredit.co.uk
(You can also order your credit report on the internet.)

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Can I appeal against a lender refusing me credit?

Unfortunately, there is no automatic right to credit. Some companies are starting to provide details as to why you have been turned down, which can help you establish the reasons. If credit scoring was used then the company should give you broad reasons for refusing you credit.

Also you may be able to ask for a manual decision if the initial decision was made by computer. See the section on ‘Credit scoring’. However, you are still only legally entitled to receive the name of the specific credit reference agency the lender consulted.

You can always contact the company again if information on your credit report has changed and ask them to look at your application again. Otherwise it may be a case of shopping around for credit, making sure you are very careful to check the interest rates and terms of any loan you are offered.

Warning

Be careful: every time you make an actual application for credit a ‘search’ will show up on your credit report. It can work against you if lots of searches show up on your report. Searches are held on file for 12 months by Experian and up to 24 months by Equifax and Callcredit.

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When will information be removed from my report?

The credit reference agency will leave the information on your report for at least six years. Information held by agencies include the following:

Credit accounts ‘in default’
These details are deleted after six years from the date of the default.

Settled accounts
These are deleted six years from the date the account is settled or when the last payment is made unless a ‘default’ was registered.

Remember

This should mean that even if you settle a debt up to six years after a default, the debt will be removed from your file six years from the date you defaulted.

Bankruptcy orders
Bankruptcy orders are normally deleted six years from the date of the bankruptcy order, unless you are subject to a bankruptcy restriction order (BRO) or undertaking (BRU) which lasts longer than six years. In this case the bankruptcy order will be removed once the BRO/BRU ends. Your credit report details can be changed to show the date your bankruptcy order ended. You can send a ‘certificate of discharge’ from bankruptcy to the credit reference agencies, but there is a fee payable to the court for the certificate. If you have not been discharged from your bankruptcy, the bankruptcy order will remain on your credit report until it has been discharged, even if this is longer than six years.

Debt relief orders
Debt relief orders (DROs) are recorded on your credit report and normally deleted after six years. This can be extended if you are subject to a debt relief restrictions order (DRRO) or undertaking (DRRU). In this case, the DRO will be removed once the DRRO or DRRU ends.

Individual voluntary arrangements (IVAs)
IVAs are normally deleted after six years from the date the IVA was set up. If the IVA lasts longer than six years it will remain on your credit report until the date the IVA ends. You can ask for your credit report details to be changed to show the date the IVA was completed.

County court judgments (CCJs)
County court judgments are deleted six years from the date the judgment was made, whether or not they have been satisfied.

Administration orders
Administration orders are deleted six years from the date the order was made.

High Court judgments
High Court judgments registered from April 2006 are held by credit reference agencies as well as the Register of Judgments, Orders and Fines. Phone us for advice.

Student loans
From 15th April 2009, the Student Loans Company can pass on details of old ‘mortgage style’ student loans to credit reference agencies. They may decide to do this if you have not made a payment arrangement or deferred your loan with them. They should contact you first and give you 28 days to get in touch with them. Phone us for advice.

Warning

Details on magistrates' court fines and Council Tax or community charge debts are not kept by credit reference agencies. This may change in the future. Phone us for advice.

Information

You do not have the right to have information removed if it is correct. From November 2004, the only electoral roll information on your credit report will be your own details even if other people are registered on the electoral roll at the same address.

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Notice of correction

You can ask the credit reference agency to put a notice on your report of up to 200 words explaining why you got into debt or why you think information on your report is misleading. You may want to explain your financial circumstances at the time and why your situation is now different. This notice will then be seen by anyone reading your report such as a lender making a search of your credit report when you apply for credit.

Most credit decisions are made by automatic means (i.e. computer). If there is a notice of correction on your report, your application must be referred for a manual decision (i.e. a person will decide whether or not you can get credit).

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Can details of other people be included on my file?

Credit reference agencies should not include information about other people who happen to live with you in your credit report, even if you share a surname, unless a financial connection has been created. This means other people's credit details should not affect your credit rating.

From November 2004 your credit report should only include:

• financial information about you;
• the name of anyone you have a financial connection with at your address (but not any financial information about that person); and
• the date and source of the financial connection.

This means that your financial details will no longer appear on anyone else’s credit report unless you have a financial connection. Your report will continue to show you who has accessed your details and when this happened.

You will be treated as having a financial connection to someone else where a lender tells the credit reference agency:

• you have made an application for credit in joint names;
• a bank account or other credit product has been opened in joint names; or
• you tell the credit reference agency that you are financially linked to someone else.

This will continue until you file a notice of disassociation to end the financial connection between you. See the section on ‘Disassociation notices’.

Warning

If you have a financial connection with someone, lenders will be able to see more information about that person on your credit report than you can. Your report will only say that you are linked to that person. A lender looking at your report will see all the normal information about that person’s credit history, such as what type of credit they have and if they are up to date with their payments.

Information

Credit reports will also include a ‘linked addresses’ section with details of any previous addresses that you provide when applying for a copy of your report and other addresses you have been connected to.

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Disassociation notices

There may be information on your report about people who you have no financial connection with, or no longer share a financial connection with you (e.g. an ex-partner). You can write to the agency to ‘disassociate’ yourself from them explaining your reasons. You will need to fill in a form giving details about the people you want removed from your report. You only need to contact one of the credit reference agencies, as they will share the disassociation with the other agencies. If the agency refuses to accept your notice you can ask the Information Commission for help. The address is in the ‘Useful addresses’ section.

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Complaints about credit reference agencies

You have the right to complain to the Financial Ombudsman Service about how a credit reference agency has dealt with your credit file. You will have to follow the agency's complaints procedure first. You can only complain about events that happened from April 2007 onwards. The address for the Financial Ombudsman Service is under the ‘Useful addresses’ section.

You can also complain to the Information Commission under the Data Protection Act 1998. They can look at issues such as why a lender or credit reference agency has not corrected information on your file, or where a credit reference agency has refused to add a notice of correction.

The address for the Information Commission is in the ‘Useful addresses’ section.

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Register of Judgments, Orders and Fines

Almost all county court and High Court judgments are recorded on the Register of Judgments, Orders and Fines and kept on the register for six years. Some magistrates’ court fines are added to the register in specific circumstances where you have not paid the fine. These will stay on the register for five years.

If you are unsure whether you have any county court or High Court judgments or whether the judgments are on the register, you can make a search against your name and address. You do this by filling in a form with the correct name and sending in the form with the correct fee.

Advice

As the fees are high, it is quicker and cheaper to contact a credit reference agency and check your credit report first.

The register has been divided into three sections:

• section 1: county court judgments, administration orders and Child Support Agency orders;
• section 2: High Court judgments;
• section 3: certain magistrates' court fines.

There is a scale of fees to pay for each search for the same name:

• one section, £8;
• two sections, £16;
• three sections, £20.

The address for Registry Trust is in the ‘Useful addresses’ section.

Warning

The register holds limited information. It will tell you the name of the court, the date and amount of the judgment and who the judgment is against. It may also list the case number. It will not have the name of the creditor or claimant. You would need to ask the county court for this information.

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Paying the judgment off

If your judgment has been fully paid, you will need to provide evidence to the court that the full balance, including costs, has been paid (usually this would be a receipt from the organisation that took you to court). Once you have paid the judgment, the court will then notify Registry Trust who will automatically mark your entry on the register as satisfied. This will then be passed on to the credit reference agencies. If you require proof you have paid a judgment, you can ask the court in which the judgment was made to provide you with a ‘certificate of satisfaction’. There is a fee payable of £15 (from January 2006) for this.

Information

The judgment will still stay on the register for six years from the date of the judgment. If in the meantime you have satisfied (fully paid) the judgment, this will also be shown on the register.

The entry will only be removed if:

• you pay off the debt within one month of your county court judgment being entered on the register; or
• the judgment is ‘set aside’ by the court. This is only possible in very limited circumstances such as if you did not know about the judgment because you did not receive the court papers and you have a valid defence to the claim.

Factsheet

We have a fact sheet on ‘Setting aside a judgment in the county court’, which may be of assistance to you. Phone us for a copy.

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Victims of fraud and identity theft

If you feel you have been a victim of fraud it is important to act quickly to prevent further fraudulent transactions.

• Report the loss or theft of any documents, cheques, plastic card and online fraud to the card issuer or lender immediately. It is up to your lender to report the theft to the police for you.
• Contact one of the credit reference agencies to notify them of any items on your credit report you believe to be the result of fraudulent activity. The agency you contact should inform the other agencies for you.
• The credit reference agencies should then cooperate to send you copies of your credit reports, advice on protecting yourself from identity theft and tell you who is managing your case and how to contact them.
• The agencies should also contact lenders for you if fraudulent applications for credit have been made in your name and make sure your credit report is corrected.
• Consider registering your details with CIFAS, the UK’s Fraud Prevention Service. For a fee, a fraud warning can be placed against your address and will be flagged up if applications are made using your address. The CIFAS marker will mean additional checks are made to ensure any application for credit is genuine. This may result in delays in your credit applications. Contact CIFAS for further information. You can download the online application at www.cifas.org.uk or contact CIFAS on 0330 1000 180.
• For general advice on identity theft, check the government website www.identitytheft.org.uk.

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Can credit repair companies help me?

You may have heard of companies that offer to clear your credit records with credit reference agencies to allow you to apply for more credit.

Warning

Be careful: you may be paying a company for something you can do yourself.

Credit repair companies may charge you a fee and often send you an information pack telling you how to get a copy of your credit report and how to clear county court judgments.

You need to be very careful before paying a fee to a commercial company who suggests it can remove judgments for you. If you apply to the county court to set aside a judgment and you do not have a real reason to do so then you could be in trouble with the court.

From October 2008, credit repair companies must have a consumer credit licence from the Office of Fair Trading (OFT). Check if the company has a licence before using their services.

If you have a complaint about something a credit repair company has done from October 2008 onwards, you can ask the Financial Ombudsman Service for help.

We understand that the Office of Fair Trading (OFT) and local trading standards departments are investigating credit repair companies. If you are not happy with a credit repair company complain to the local trading standards department by contacting Consumer Direct.

Advice

You can also check out a website set up by representatives from trading standards, the credit industry and credit reference agencies which gives more information on credit repair companies and what to watch out for. The address is www.ukcreditrepair.co.uk

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Useful addresses

Consumer Direct
Tel: 08454 04 05 06
www.consumerdirect.gov.uk
email advice via form on the website.
(for complaints to Trading Standards)

Financial Ombudsman Service
South Quay Plaza
183 Marsh Wall
London
E14 9SR
Tel: 0845 080 1800 or 0300 123 9123
www.financial-ombudsman.org.uk

Office of Fair Trading
Fleetbank House
2-6 Salisbury Square
London
EC4Y 8JX
Tel: 0845 722 4499
www.oft.gov.uk

The Information Commission
Complaints Department
Wycliffe House
Water Lane
Wilmslow
Cheshire
SK9 5AF
Tel: 0303 123 1113
www.ico.gov.uk

Registry Trust Ltd
153-157 Cleveland Street
London
W1T 6QW
Tel: 020 7380 0133
Email: info@trustonline.org.uk
www.trustonline.org.uk

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Mortgage Possessions Register

What is the mortgage possessions register?

The Council of Mortgage Lenders keeps a register of people who have been repossessed or who have handed in the keys on their home. The information is passed on to the credit reference agencies Experian, Equifax and Callcredit, and appears on your credit reference file. The information is only available to members of the Council of Mortgage Lenders and the register may be checked if you apply for a new mortgage.

The aim is to stop people taking out a new mortgage without telling their new lender they have previously lost their home. It is not impossible to get a mortgage if you are on the register but it may be more difficult, especially if you still owe money to your previous lender.

You may have to shop around for a mortgage and be prepared to explain why you lost your home and how your circumstances have now changed. Every mortgage company has its own lending policy and should make decisions on an individual basis, taking all the facts into account.

What details will be kept about me?

The register will have details of anyone who has been repossessed since 1989 and the information will stay on the credit reference agencies’ files for six years from the date of repossession or when you handed the keys in to the lender. The register does not include details of actual arrears on the account.

Warning

This does not mean the debt is written off after six years. Mortgage lenders may try to recover a mortgage shortfall for up to 12 years.

Details will include:

• your full name;
• the date actual possession was taken of your home;
• the address of the repossessed property;
• any previous address your lender may have for you; and
• your forwarding or current address.

Information

This will only apply once you have actually left your home. If you are still in your home you will not be on the register just because you already have a court order against you.

How do I check what the register says about me?

The mortgage possessions register information will be on your credit file. You can order a copy of your credit file in the normal way to see if any mortgage information is included.

For information on how to check what the credit reference agencies say about you see ‘Credit Explained’ a booklet published by the Information Commissioner. This is available from National Debtline or from the Information Commission. See the ‘Useful addresses’ section.

It describes how to check what your file says and what to do next if you think the information is wrong. Phone us for advice.

What can I do if the information on the register is wrong?

You have the right to ask credit reference agencies for full details of the information they hold about you. If the information is wrong then you can correct the file. You do not have the right to have a correct entry removed but the file should be marked ‘satisfied’ if you pay the outstanding arrears or shortfall, or if the proceeds from the sale of your house covers any outstanding debt.

Factsheet

We have a fact sheet on ‘Mortgage shortfalls,’ that may be of assistance to you. Phone us for a copy.

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Remember: You can always Phone us for advice about any difficulty you are having in dealing with your debts

0808 808 4000

© Copyright National Debtline 1994 (updated May 2010).

Whilst we endeavour to keep the content of our website as up to date as possible, National Debtline cannot be held responsible for any changes in legislation or for developments in caselaw since this information was published.

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