Your Credit Rating Will Be Affected


Entering any type of debt solution is likely to result in damage to your credit rating.


A damaged credit rating can cause difficulties in obtaining credit in the short-term and there is some likelihood that such difficulties may continue in the medium to long-term.


For All Debt Solutions


In connection to formal debt solutions and informal debt management plans we draw your attention to the following specific matters:


Certain types of account-specific information get documented on your credit record. Missed payments, late payments, or reduced payments, are all likely to be reported to credit reference agencies.  The information that is reported will usually remain on your credit file for six years.


Default notices may be issued on your accounts. Any default notice will remain on your credit file for a period of six years.


A damaged credit rating could potentially restrict access to all types of credit. The terms upon which any type of credit is offered to you may be less beneficial than credit terms available to persons with good credit records.


Some employers and regulatory bodies may include credit checks or disclosure obligations as part of their employment application or review procedures.


This includes disciplined work like the police or military. It also includes professions like accountants and solicitors. Credit checks are common if you work in financial services. This list of occupations is not exhaustive; confirm your position with your employer and/or regulator before entering a debt management solution.


Debt Arrangement Scheme – Scotland


The debt arrangement scheme is not personal insolvency but the personal details of DAS users are recorded on a public register.


For Personal Insolvency Debt Solutions


Types of personal insolvencies in the UK include an IVA, bankruptcy, debt relief order, protected trust deed, or sequestration.


We draw your attention to the following additional subjects in respect of insolvency:


You may become subject to restrictions about obtaining any further credit prior to your discharge.


Public registers of personal insolvencies exist and most can be searched online.


Employees in some types of employment may find that using a formal personal insolvency process prevents them from working in their chosen field. Personal insolvency may also prevent you from standing for some types of public office.


Certain types of personal insolvency are incompatible with being a company director.


Get Credit Rating Advice


If you have questions about the potential impact on your credit rating of using a debt solution, please contact us.


Our expert debt advice team can help you to understand how seriously your credit rating will be affected and when it could recover in the future. The answer to your question will vary according to which debt solution appears to be suitable for your needs.



Author: Andrew Graveson

Qualified Debt Adviser & Bright Oak’s Founder


Page Last Updated: 25/07/2020



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