MONEY BOX LIVE. Presenter: LESLEY CURWEN. TRANSMISSION: 16 th JULY RADIO 4

Transcription

1 THIS TRANSCRIPT IS ISSUED ON THE UNDERSTANDING THAT IT IS TAKEN FROM A LIVE PROGRAMME AS IT WAS BROADCAST. THE NATURE OF LIVE BROADCASTING MEANS THAT NEITHER THE BBC NOR THE PARTICIPANTS IN THE PROGRAMME CAN GUARANTEE THE ACCURACY OF THE INFORMATION HERE. MONEY BOX LIVE Presenter: LESLEY CURWEN TRANSMISSION: 16 th JULY RADIO 4 CURWEN: Hello. Every time you apply for a loan, a mortgage, a credit card or a mobile phone contract, companies will check your credit report to work out how responsible you are as a borrower and whether they want to have you as a customer. A poor credit report can stop you getting access to the money or the services you need. This week our panel s answering questions on credit reports. What does it cost to check your record and how often should you do it? And what happens if the details you see are wrong, in your view, or give an unfair picture of your financial life? What s the process for getting the file changed? Plus what if your record is damaged by a former partner or family member s financial mess? And how long do records of missed payments or bankruptcies have to stay on file? Perhaps you re one of millions of people who ve never taken out any form of credit. What problems might that cause you in the future? And there s also the issue of how to complain if you re not satisfied with the way the credit reference agency deals with you. Lots to talk about. Whatever your question about credit reports, call Money Box Live now: With me today to answer your questions are James Jones, who s Head of Consumer Affairs at the credit reference agency Experian; Kirsty La Garde who s Consumer Experience Coordinator at Noddle which is part of Call Credit; and Regina Martin who s a money adviser at National Debtline and Business Debtline. Welcome to all of you. Our first question is from Joan in Nottinghamshire. Joan, what is your question? JOAN: I have a problem in that I am too credit worthy. I m a retired head teacher. I ve had a budget account at John Lewis with my husband, a joint account for more than 40 years; and recently we decided that since we were buying several items by 1

2 credit card and debit card as well, we might as well have the benefit of a Partnership card. So both of us went into the store with our passports and our driving licences because we re reluctant to send sensitive information through the post and we were dealt with very kindly. My husband s card was accepted. He was given a card through the post and everything was set up. And the lady who dealt with us said, Just send off the form and you ll be able to have an additional card for the same account. CURWEN: And so have you been rejected? Is that the upshot? JOAN: got a letter from John Lewis that said we need further proof of identity and your address because you don t have any credit history bearing in mind that John Lewis have had my full buying history for more than 40 years and bearing in mind also that we pay off this account in full we made provision to pay off this account in full at the end of every month. The problem is I have no mortgage, we have no debts, we pay our bills on time, I m not in receipt of benefits, and yet I m being asked to jump through extra hoops having to have documents photocopied and certified and sent off CURWEN: Okay Joan JOAN: and I feel I m being penalised and I feel there are equal opportunities issues here. CURWEN: Okay, let s try and get some advice for you about this. James Jones from Experian, you can see why she s cross? JONES: Well absolutely, Joan, and you know I really sympathise with your predicament there. I m not clear on exactly what you ve applied for because if it s a credit or a store card, then these don t generally tend to be joint credit products. They tend to be in one person s name only and in that case it sounds like you might have been positioning to be a secondary card holder on your husband s JOAN: I asked to be an additional card holder on the Partnership Account, which is run by HSBC. JONES: Yes. So I mean it just depends how the product s set up. If it is like a store 2

3 card account, then actually it will be your husband s account and the credit check will have taken place in your husband s name and not your name because you will actually have no liability for that product. If it s some sort of other product, then it is possible that there are credit checks being run on both of you. And if as I think you ve sort of implied you might not have very much information on your credit history because of your kind of recent borrowing record credit reports only generally go back 6 years, so if you ve not used any credit over that period then you might find you don t have very much information on your credit report and that could potentially be the issue. CURWEN: So what could Joan do? JONES: Well, Joan, I mean if that is the case or regardless really it s probably a good time now to actually go to the credit reference agency that s been consulted - and the store will be able to tell you which one they ve contacted and get hold of a copy of your credit report, so you can see exactly what has been recorded and then get some advice from the agency on what you might be able to do if it needs improving. CURWEN: Regina Martin, what s your advice for Joan? MARTIN: I would absolutely agree with what James has said. Absolutely get a copy of your credit reference file. It might just be a simple issue that she may not be on the electoral register because sometimes that can have a significant impact. CURWEN: Joan, are you on the electoral roll? JOAN: I ve lived in the same house for 40 odd years. CURWEN: That s not necessarily the same thing though, is it? Do you know you re on the electoral roll? Do you vote? JOAN: Yes. CURWEN: Yeah you are. Okay. JOAN: Yes. 3

4 CURWEN: What else can she do, Regina? MARTIN: It may just be a case that she needs to build up her own credit history. Like James said, if she s an additional card holder, it means that there s very little information on her credit reference file. Never having had credit doesn t automatically guarantee you a good credit score. In some instances, it can mean the opposite. So what your credit reference file is showing is how good you are at paying the debt that you have. If you have none, then they can t tell. CURWEN: Okay, Joan, I hope that s helpful. And obviously you need to get back in touch with the credit reference agency that was used and try and find out what s actually at the base of it. Is that okay? JOAN: Yes that s fine. CURWEN: Okay. Joan, thanks very much indeed for your call. Now we re going to go onto Michael. Michael, you re calling from Fareham in Hampshire and I think you ve got a kind of related problem. Is that right? MICHAEL: Yeah. I m blind actually. My wife and I have two joint bank accounts, but she does all the arrangement of all the finances and we ve never defaulted on anything. Consequently she has a first class credit rating. I don t have one at all. I m just wondering how to acquire one if it s ever necessary to have one? CURWEN: Okay Kirsty La Garde from Noddle, which is part of Call Credit, let s see what you think about this. How does Michael acquire one? LA GARDE: Yeah hi Michael. The thing that you said there is that you have a joint account. If you have a joint account, that means you re financially connected with your wife. If you are, then you actually do have a credit history. So ultimately that would be against a mortgage or if you ve got any loans jointly. So certainly for me, it is worth always looking at your credit file. Now in reference you mentioned that you re blind. Each of the credit referencing agencies has the ability to have a larger text online, so you should be able to look at it from that point of view. Or alternatively they also have helplines where you can actually phone up and they should be able to 4

5 help you to go through the initial sign-up process. There is also the statutory credit file report that you can go for, which is just 2, or alternatively you can look at Noddle as an option which is then a free credit report. So there are a number of options that you could do, but certainly I do think it is worth you looking at your credit file. CURWEN: Michael, you said when you talked to our researcher that you ve got some credit cards yourself, so it sounds as though you must have some kind of credit history? MICHAEL: Well I probably misled her a little bit there. I ve got a card that ll get money out of the wall and it s also a debit card. I don t have an actual credit card. CURWEN: And let me just ask James Jones from Experian. I mean what kind of facilities are there for blind people who need to use these services? JONES: Well we try to cater for everyone, especially people with you know particular sort of accessibility issues. So we can provide credit reports, as Kirsty said in large print but also in braille, in audio formats to make sure you know there s a way that you can get the information that you can then CURWEN: All for 2? JONES: All for 2. So you can understand that. And then importantly if you come back to us, we can talk you through the information and give you kind of bespoke advice on the things you might be able to do to beef up your credit record, if you like, to help you get a yes next time you apply. CURWEN: Michael, are you going to take that advice? What are you going to do? Get in touch with one of the agencies at least? MICHAEL: Well at the moment I m pretty happy with the way things are. I was just asking what I should do if in future I needed to do something. But I gather from what you ve told me that there are one or two things I can do, so that s what I will do if it becomes necessary. CURWEN: Well let me just check with Regina Martin. I mean what sort of things 5

6 could he do to beef up his credit score? We ve mentioned a couple of them, but any other ideas? MARTIN: I mean it might well be that he starts low and gets himself a credit card with a very low limit obviously ensuring that he maintains the payments on that. Some people kind of tend to go to catalogue companies as well, store cards as well because they give you a low limit, but you re able to either pay your balance off at the end of the month or keep within your expenditure. Obviously keeping up with the payments continuously means that your credit score improves. CURWEN: Okay, so Michael the key message is if you do do anything, if you do borrow any money, to keep up the payments. That s the key thing to make sure your credit score s good. MICHAEL: Yeah, I understand what s necessary now. My only sort of experience really is I wanted to get a mobile phone number on credit and they wouldn t give me one, so I just have it payment in advance. CURWEN: Okay well maybe you can change that, but the key thing is to first of all find out what s in your credit report and then you can build it hopefully from there. I m going to move on because in fact in some ways I m going to go back to basics, which is exactly what Michael needs to do to find out what is his credit report, what his kind of score is. Now Sonia has ed us to say exactly that how do I find out my credit score? So let me go back to Regina in fact for a moment. What do you think is the basic way? We talked about the 2 route. Just describe to us how somebody does that and why you can get it as cheaply as that with all the three agencies? MARTIN: All three agencies are able to provide you with a paper copy, which is your statutory copy of your credit reference file. You can actually write a letter to them asking them for a copy of the credit reference file. CURWEN: Or apply online. MARTIN: Or apply online. It s always recommended, especially by us at National Debtline, that those letters are sent recorded delivery because things get lost in the 6

7 post. Your credit reference agencies then have 7 days in which to comply with your request, so they ve got to get back to you within 7 working days. As I ve said, it s as low as 2 to do that. CURWEN: And that s a snapshot. You don t have to sign up for monthly fees MARTIN: No. CURWEN: but obviously you can do that. James Jones of Experian, just tell us about your service. That s free for 30 days. Is that right? JONES: Well that s right. I mean all three agencies also provide value added services that give you extra benefits like scores, they monitor your credit report, they can match you to credit products you re more likely to be accepted for. So our CreditExpert service you mentioned is available on a 30 day free trial and you know they are incredibly popular if CURWEN: And after 30 days? JONES: Then we charge a kind of flat monthly fee, which is around 15, I think. CURWEN: Okay. On Money Box earlier this year, we heard some people who were unhappy that the report comes willy-nilly with ID fraud insurance, which kind of amounts to about 6 a month. Can you ask to have your CreditExpert service without that insurance? JONES: Well it s important we provide a range of services to help people. We certainly know from the customer focus group work we do and from our online forum that a lot of people are concerned about identity fraud, which is why we include identity protection features in there. But it s something we keep under review and, as I say, if you go our website there are a choice of services for you to look at. CURWEN: But at the moment you can t get that without the ID fraud insurance? JONES: The credit expert product currently includes identity fraud expenses insurance. 7

8 CURWEN: Okay, let me move onto Call Credit. You ve got an option, haven t you? Noddle is the free option from Call Credit, Kirsty La Garde. How does that work? LA GARDE: Yes, so we obviously have two products. We have the premium product, which is Credit Compass, which is a monthly fee similar to the other agencies, but then Noddle is a credit file which is free for life. So ultimately once you ve signed up and completed all the fraud checks similarly to the other agencies, you re provided with your credit file and there s no charge attached to that. CURWEN: But how do you manage to do it for free when the others are charging? What s the catch? LA GARDE: There is no catch at all and actually we are upfront completely in terms of the service we re providing. So the terms and conditions state that you can look at your credit report every 30 days and that s when it s refreshed. We provide access online for you to see credit cards and loan information. However there s no obligation to actually take those up. However, if you do want to look at credit cards or loans, we look at your credit file and then get a propensity for you in terms of confirming what you might be able to take up and we get a chargeback off that. CURWEN: Okay, is it updated as often as the paid for service this free service? LA GARDE: We have two additional services where you can provide sorry we provide products which are chargeable. And again if you go to those then CURWEN: But it s not updated as often? LA GARDE: No it s not. It s every 30 days, yeah. CURWEN: Okay. And we should say that Equifax has a product which gives you monthly reports the first month free that costs a month just to be fair about that. Okay let s move onto our next question. It s from Richard who s calling us from Rhyl. Richard? RICHARD: Hello there. My son rented a flat a few years ago from a housing association. There were problems with the property and he refused to pay the rent. 8

9 Moved out and left me there looking after it for him and then I eventually left with outstanding rent. I spoke to the housing officer. Because I left the flat in such a good state, he said he would sort out the arrears for us, you know which I took to mean he would write them off. Five years later, a collection agency s after my son and given a negative credit score. Can they do that? CURWEN: So what you re saying is that your son is still in arrears; that there s a debt collection agency after him and is that going to affect his credit report? Is that? RICHARD: Well he s checked his credit score and there is a black mark you know on his name, which he s very unhappy about obviously. And I ve been in discussion with the housing association trying to get it rectified and I m not getting any joy from them at the moment. I don t want to approach the debt collection agency in case CURWEN: Let s ask Regina Martin about this. Regina, what s your advice? MARTIN: This is quite an unusual one because it s quite rare for somebody to have information put on their credit reference file for rent arrears if there s no county court judgement. Has your son been sued by the housing association? Do you know if they ve taken him to court? RICHARD: Has he been what, sorry? MARTIN: Have they taken your son to court? RICHARD: No, no. MARTIN: And when you say that there was a black mark on the credit reference file, what was it? RICHARD: Oh sorry, I don t know the correct terminology for the negative credit score rating system. I don t know what you call it. I couldn t remember the name of it. But basically when he checked his credit score, there s this blemish on there. I m not sure what it says actually. Perhaps I should have got that information beforehand. I m not sure what it says. He s just told me it s on there. Unfortunately this has caused a 9

10 rift between him and I, quite a deep one, and communication. MARTIN: My advice to you would be to a) get a copy of that credit reference file; and, obviously because we re pushed for time here, give National Debtline a call. The information can be found on Radio 4 s website. Give National Debtline a call. They re open from 9 until 9 Monday to Friday and until 1.30 on Saturday. CURWEN: And that s a free service? MARTIN: It s a free service, it s a free service. So you would get some more detailed advice as to what to do with regards to that. RICHARD: Okay. Would they tell me which companies can affect your credit score? I mean can anyone do it? You know say, for example, Vodafone, if you ve got hidden charges and they suddenly try to apply them to your account and you don t pay them because you re in dispute, can they then give you a negative credit score? MARTIN: Yes. CURWEN: James Jones, do you want to answer that? JONES: Yeah well I think the key (and to try and to try and broaden it to other listeners as well) is if you get hold of your credit report from any or all of the credit reference agencies and find something on there you disagree with, come back and tell us because we have very clear procedures for helping you investigate and rectify anything like that. So if the information s wrong or you think it might be wrong, we will actually mark the information as disputed and we ll normally raise an investigation with whichever organisation sent us the information to get them to check that it s correct. If the two parties can t agree what the facts were and that s ultimately what we re trying to achieve, it s vital that credit reports are accurate and up to date then we can signpost arbitration like the Financial Ombudsman Service. And if it is correct but it doesn t tell a very good story but there s a good reason for that, then we can advise people on how they can add their own comments to their credit report to add some background information. CURWEN: So Richard, obviously please pursue it. I m sorry that we can t actually 10

11 sort it out for you today, but good luck. And the key thing is to get that credit report, first of all, and then follow it up from there. So I hope that helps you. I want to read a quick , which is from Suzanne, who says Dear Money Box, I have a vague notion that outstanding debts can be linked to a property, thereby affecting the credit rating of someone else living at the same address. Is this true? Kirsty La Garde, is that true? LA GARDE: No, it s a misnomer. I think your credit file actually refers to you as an individual, so it never goes back to an address, so it doesn t matter what s happened at that address previously to you living there. Your file is all about you as an individual. CURWEN: Okay. And I mean do you get people, Regina, who just don t understand that, who get worried about it? MARTIN: Absolutely. This is a common call for us at both Business Debtline and National Debtline. There is free advice out there, so if you are confused about your credit reference file obviously you can contact any of the credit reference agencies, but you can speak to a debt advice agency such as ourselves. CURWEN: Okay, I m going to move on to the next call from Alex in Gloucester. Alex, what s your question? ALEX: Hi. Yeah well I think some of it might have been answered with your previous caller. However, I went bankrupt in 2008 and in 2009 I was released from bankruptcy. I recently went to apply for a loan which was showing up on my account as available for about 6 months of last year and I went this year to apply for it and was told that it wasn t available anymore and to check my credit score. So I went onto one of these agencies and there is an outstanding debt from prior to my bankruptcy which was covered by the bankruptcy, which is still showing up on my credit report as a monthly default on payment. Is that right? How can I get rid of it? And if I do take it to dispute, to the agency, do I have to sign up for monthly fees? CURWEN: James Jones, what s your view on this? JONES: Okay Alex, I mean the debts that led up to and were incorporated into your 11

12 bankruptcy shouldn t now be showing as outstanding certainly and they should either be dated on the bankruptcy or before. So I don t know if the bankruptcy s still on there. It sounds like, if it was 2008, it s probably about to expire or it recently has expired because we generally only hold information for 6 years. But if one of the creditors is still registering information about this account and they re showing it as either outstanding or in arrears, that is clearly wrong. So if you come back to whichever credit reference agency you got that information from and ask them to raise a dispute on your behalf, we ll do that for you. We ll mark your credit report as under investigation and we ll speak to whichever creditor is saying that about you. CURWEN: Regina Martin from National Debtline? ALEX: Will you do that even without. Sorry CURWEN: Sorry Alex. ALEX: will you do that even without the membership? JONES: Yes. Once you ve got your credit report, any help and as we ve discussed you can get a one off report just for 2 or the other services which you can look at. CURWEN: So Alex won t have to pay a regular monthly fee? JONES: There s no additional charge for getting help from us about your credit report. We are here to help. CURWEN: Alex, did you understand that you wouldn t have to pay a monthly fee, or were you concerned about that? ALEX: I didn t ask I did one of those 30 day free trials. I got my report and I thought well okay I ve got my report, I ll cancel the contract because I didn t want to tie myself up for a monthly fee with a credit agency. I didn t know now that I ve cancelled that, I can go back and still ask them to help me out on that one. JONES: If you go onto our website or any of the websites and click on the contact us link, you can basically just us. Quote the reference from the report you ve 12

13 had in the past and ask us to look into it for you. There s no charge for that. CURWEN: Okay, I hope that helps Alex. Good luck with it. And I m going to move onto an from Claire who says, I have debts which I m paying off under voluntary agreement. I m contacted from time to time with offers to pay off the debt in full at a discounted rate. If I did this, would the debt stay on my credit report or after the same amount of time as if I d paid it off in full? Would it disappear and my rating be repaired? Regina Martin? MARTIN: There are two ways in which a lender can mark your credit reference file once you have agreed to what is known in the industry as a full and final settlement agreement. Again it s something that commonly comes up for us at National Debtline. They can either mark your credit reference file as fully satisfied or partially satisfied. That would form a part of the negotiations that you have with them. It can differ from lender to lender, so our recommendation would always be that as part of your negotiations, which should always be in writing, you say I m paying you in full and final settlement. Please mark my credit reference file as satisfied. Both National Debtline and Business Debtline have sample letters on their websites that you can use when you re negotiating with your creditors. CURWEN: Kirsty La Garde, a lot of the trouble is just with the lingo that s used, isn t it? LA GARDE: Yes. CURWEN: I mean it s just very confusing for people who don t understand the credit industry and how it works. LA GARDE: Absolutely. I think as somebody who s only been in the industry for a few years exactly the same, and I think when you first go online I think certainly there is always that fear when somebody mentions credit. But ultimately there are a number of, as I say, online agencies, so actually you can have a little look without actually particularly purchasing anything just to get some background history. But certainly in terms of understanding, the 2 statutory report is a really good one to start off with and then certainly maybe stepping up slowly. So you start off with Noddle, which is a 13

14 free service. Once you ve looked at your credit file there CURWEN: Other services do exist, but yeah. LA GARDE: Absolutely. Well I was going to go on to say CURWEN: Just one suggestion, yeah. LA GARDE: that ultimately once you ve done that, sometimes the additional services provided by the other agencies give you much more detail, so you can then step it up further and actually then look at possibly paying. But certainly there are a number of slow steps that you can take. CURWEN: Okay and our next caller is Christine who s calling from Manchester. Christine, what s your question? CHRISTINE: Oh hello. CURWEN: Yes please tell us your question. Hello Christine. CHRISTINE: Hello. CURWEN: Can you hear me okay? Hello Christine. I think we may CHRISTINE: Hello. CURWEN: Christine, can you hear us? CHRISTINE: I can. CURWEN: Oh jolly good. Tell us what your question is. CHRISTINE: Okay, well it is kind of about the credit report really. They are quite confusing. I got all my credit reports from all the agencies because I had a bit of an issue with a loan that I had. And it was mainly my fault, but I couldn t make the payments at a certain time and I kept the bank informed and I had some arrears which I cleared. And then I went to apply for a mortgage and I tried a lot of different lenders and eventually I found one that would lend me the money and then they changed their 14

15 mind, and then in desperation to try and get a house, I was trying to find other lenders. And some of these lenders said we only do a soft search, so it won t affect your rating, so I was like Great, brilliant. And they did some searches and when I looked later at my credit report, I had something like thirty different searches and I was like, I didn t authorise any searches and these soft searches were supposed to disappear. And I just wondered I ve got a few late payments, but the arrears are paid in full. All these searches and my loan, which is quite a high value loan however I can service it fully with my new salary I just wondered what is the significant issue on my credit report likely to be because you know as a user, I just don t know? CURWEN: Christine, first of all, let s ask James Jones what is a soft search? A lot of us will be completely fogged by all this? JONES: The law gives people rights, very clear rights around credit report information. One is you have a right to see it. Another one is you have a right to see who else has seen it, and for that reason we capture footprints every time an organisation accesses your credit report. Importantly the footprints always say why the access took place, so it could be you applying for credit. It could be you simply asking for a quote. It could be you checking your own report. It could be an organisation simply checking your ID. CURWEN: So should Christine be worried about all these searches? JONES: You see all of these footprints. Lenders only see the ones that were created by you applying for credit. So, Christine, all the applications you made and it sounds like you might have made a few will have left footprints that your lenders will see, future lenders will see. CURWEN: So she shouldn t necessarily be too worried? JONES: The ones that weren t generated by you applying for credit won t be visible to lenders, so you don t need to worry about those. If you re in any doubt, come back to the credit reference agency you ve got the report from and we ll talk you through it. CURWEN: Okay. Christine, good luck with that. Hope it works for you. And that is 15

16 about all that we ve got time for today. My thanks to James Jones who s the Head of Consumer Affairs at Experian; Kirsty La Garde from Noddle, which is part of Call Credit; and Regina Martin from National Debtline. Thanks to all of you who called or ed us today. We had a lot of calls. You can find out more about credit reports on our website: bbc.co.uk/moneyboxlive. This is the last Money Box Live until September 3 rd. Paul Lewis is back on Saturday. 16