1 - One of the credit reference agancies has refused to remove incorrect information from my credit file.

If you believe that there are incorrect entries on your credit file and you do not get a satisfactory response from a credit reference agency then under the data protection act, you can take your case to the Information Commissioners’ Office.

This Office oversees the data protection act which credit bureaus are required to follow. You can contact the Information Commissioner’s Office via their website: http://www.informationcommissioner.gov.uk

2 - My Debt is Older than 6 Years Old. Does this mean it is automatically written off?

The UK Limitations Act of 1980 states that the maximum time a creditor can demand repayments on a sum outstanding is 6 years. If a period of 6 years has passed since the creditor last contacted you demanding payments towards your debt, your debt may become statute-barred (i.e. no longer legally collectable).

Note: The exception to this rule is mortgage debt shortfall after a property-repossession. In this, the creditor can demand repayment within anytime up to 12 years after the debt is incurred.

For Income Tax, VAT, State benefit overpayments, social fund loans, overpayment of grants, council tax and any other debts to the Crown there is no limitation period, which means you can be chased forever for these debts.

If you have not been chased for payments for a clear period of 6 years then after that you do not have to repay your debt and the record of the debt should be deleted from you credit file.

However, beware that for the purposes of the UK Limitations Act, the period of 6 years starts when the last payment, admission or attempt to collect the debt was made. If you have made a part-payment or the creditor can prove they wrote to you to recover the debt or you wrote to them admitting the debt within a six year period, then the six years clock will restart at that point in time! If you move house and do not tell the lender, then you cannot argue that the lender was writing to you at the wrong address.

3 - Can I get a new credit file?

It is illegal and practically impossible in the UK to receive a new credit file. You may see advertisements to get a new credit file or “clean up” your credit file. These are often misleading as there is very little that can be done to achieve this other than that already explained within this guide.

4 - I am Already in Debt but Keep Getting Offers of More Credit

Perhaps strangely, creditors may not be aware that you cannot really afford to repay the debt that you already have. This is because you continue to maintain your minimum payments largely by robbing Peter to pay Paul.

If there is frequent and satisfactory activity recorded on your credit file (i.e. minimum payments always made on time), this will generally indicate a good credit score to potential lenders even though in reality you are simply moving funds between different creditors and may be heading for a fall.