# MBNA / Credit Rating Questions



## QA1 (24 Nov 2010)

Hi Everyone. 

I apologise in advance for the long post, I would like to give as much information as possible as I would like as much feedback as possible.

I had an MBNA credit card with a 5000euro limit. The card expired 08/08 & was not renewed because I was not a responsible borrower.

I regularly missed my minimum payments & went over my credit limit, (because of late fees applied to my already maxed limit).

Late 2009 MBNA started to contact me regularly & aggressively, I was over my limit & I was not making minimum payments. While I dont agree with their approach I am glad that they kicked me into action.

In January 2010 I changed my circumstances so that I could not only make the minimum payments buy pay at least the minimum payment (usually approx 60euro) plus 100euro a month. 

In December 2009 I outlined my plan to pay to MBNA, I do not remember specifically what I said, all agreements from my side took place via phone & I stupidly didnt keep a record. I do however remember that I agreed to at least make the minimum payment amount. I received a letter from MBNA in January 2010, I also stupidly have misplaced this letter having since moved house, I do not remember the exact contents, all that i can clearly recall is them acknowledging my agreement to meet the minimum payments, acknowledging that I had brought my account under my credit limit & I vaguely remember mention of the ICB, I think the letter stated that they would contact the ICB to say that I had rectified my account, although as I type this it seems unlikely that they would go to that effort! I have searched in vain for this document, I am reluctant to contact MBNA to ask for another copy because of their way with handling customers & my tenancy to bury my head in the sand where this problem is concerned, up until now at least.

As of right now I have reduced the amount owed from circa 5300 to 3.5k. I plan to reduce this amount by 400euro per month as of 6th December 2010. I have set up a direct debit for this amount. This is a manageable & affordable amount for me to repay for next 6 months at least.

I have one other credit card with AIB which I have had for approx 7 years (obtained as a student). For the past couple of years I have not missed a payment, the credit limit is considerably lower, this card was recently renewed, which I took to be a good sign.

I have had two personal loans in my lifetime, both for cars & with a 1 year gap between repaying the 1st (for 5k) in full to taking the 2nd. I am 3/4 the way through repaying my 2nd loan which was for 10k, paid monthly via direct debit. I have never missed a payment on the 10k loan. I missed 1 payment on the first loan, missed payment was due to the money not being taken from my account (banking error) which the lender had previously agreed to rectify with the ICB.

My questions are as follows:
1. Have I completely ruined my credit history? 
I have requested a report from the ICB & expect to receive it this week; I did request one back in 2008 & MBNA featured a lot of x's for me. 

2. If my credit history has been affected, it will be affected for 5 years after I rectified the situation in January 2010 or 5 years after the total amount owing is repayed?

3. Will how I repay this loan affect my credit rating - ie I could potentially pay a lump sum in January 2011 of approx 1K but would it be better for my repayment history (albeit more expensive interest wise for me) to show regular payments of a fixed amount?

4. I do not plan on applying for a loan of any description over the next 3 years, however, I am planning to enter a mortgage deposit savings plan with the aim to apply mid 2014 for a mortgage. I would like to manage my partners expectation of whether or not it would even be worth our while applying then - which is essentially why I am posting this thread. 

My partner has separate savings so deposit would be approx 35k, judging by current house prices in the area in which we wish to settle we plan to spend approx 200k. He has no issue with his credit rating. 

5. If I contact MBNA & ask for a copy of the correspondence issued originally in January 2010 are they obliged to re-issue?

6. Has anyone had any success with any lender in attempting to improve their credit history or is this even possible? 
If I explain my situation, having kept to my 'repayment word' for almost 1 year, will they be willing to help me improve my chances of securing a mortgage further down the line?

I have a stable, secure (as one can be) job & earn just under 40k per year. My salary increased from 30k last year but will not increase dramatically for approx 3 more years. I would expect an increase in salary of 2% p/a until mid 2014.

Im thoroughly ashamed that I have been so irresponsible, I appreciate any advice that can be offered. I also appreciate the opportunity this forum has given me to finally put all of this in writing, I feel a weight has been lifted regardless of the outcome.

Thanks


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## Time (24 Nov 2010)

MBNA will have truly destroyed your credit rating. That is a certainty.

The problems with the missed payments and overlimit aspects should be gone in 2 years. 

Paying more off now will not improve your credit rating. The problems need time to go away.


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## Molly (24 Nov 2010)

Time said:


> MBNA will have truly destroyed your credit rating. That is a certainty.
> 
> The problems with the missed payments and overlimit aspects should be gone in 2 years.
> 
> Paying more off now will not improve your credit rating. The problems need time to go away.



Whilst MBNA are known for their aggressive approach to arrears collection, they , same as ever other lender in the country, report to the ICB your repayment record. The borrower is solely responsible for what is recorded on their ICB record. MBNA, nor any other lender can "destroy" someones credit rating. 

The ICB record shows all repayment history for typically the  previous 5 years. If you wish to apply for a mortgage in 2014, its likely that the missed payments in 09 will be recorded on the ICB.


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## Time (24 Nov 2010)

They only show payment histories for 2 years.


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## Molly (25 Nov 2010)

Time said:


> They only show payment histories for 2 years.



If you have kept to all repayments then the report will show the previous 24 payment, If you have missed any payments over a 5 year period then the full 5 years will show.


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