Wonga has recently announced it is cancelling loans owed by a number of customers following a review of its lending criteria. Can you tell me what will happen to these people’s credit reports and when, and how this will affect their future credit ratings? Thanks.
I’ve received a few questions on this issue, so let me explain what’s happening. Firstly, it’s essential that credit reports represent an accurate record of someone’s credit commitments.
To this end, we’ve been working with Wonga to make sure that affected customers’ credit reports are updated in a timely and appropriate manner.
The result is that we are completely removing all record of these loan accounts from customers’ credit reports. A record of the loan application being made will remain but this will not show whether the loan was accepted or refused.
This change is due to take place in early November and affected customers do not need to take any action. However, if you took out one of these loans and want to check that your credit report has been updated you can easily do this via the Experian website.
CreditExpert customers will simply need to login to check their up-to-date report. In terms of the impact this change is likely to have on affected customers’ credit ratings, I understand that the vast majority of these customers were in default on their loans.
The effect of removing a default from your credit report is likely, of course, to be positive for credit scores, but this will always depend on a number of other variables, such as the other information on your credit report and the policies of the lender calculating your credit rating.
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