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The Royal Bank of Scotland Plc

Financial Ombudsman decision DRN0760223 Not upheld

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What this decision was about

Treatment in financial difficulty, Credit file reporting

In the Ombudsman’s words

Mr N and Miss B complain that their joint loan with The Royal Bank of Scotland Plc was unfairly defaulted.Treatment in financial difficulty

I think it’s reasonable to note that at no point did RBS agree to accept reduced payments of £1 per month indefinitely. The 12 month payment arrangement agreed in October 2015 was temporary. RBS has said that even at the current £3 per month level the outstanding balance will take around 86 years to repay. Without an increased offer or payment I think it’s more likely than not that the loan account would still have been defaulted at some point. Both RBS and the investigator have made the point that by applying the default in October 2015 it will drop off Mr N and Miss B’s credit files in 2021. But if an ongoing payment arrangement of £1 a month was still in place this would continue to be reported on Mr N and Miss B’s credit file. Whilst a default arguably has a greater impact on a credit file for the six years it’s reported, a payment arrangement is also considered to be adverse information. In addition, an ongoing payment arrangement would continue to be reported until six years after it ended, so at this point the impact’s likely to last longer.Credit file reporting

Source

This page summarises the Ombudsman’s published final decision. The document itself is the record: DRN0760223.pdf on financial-ombudsman.org.uk.

The outcome shown is the Ombudsman’s own published classification, not our reading of the text. Nothing here is legal advice, and a decision concerns only the complaint it was made about.