Not upheld: Credit file / adverse marker disputes complaint against Volkswagen Financial Services (UK) Limited

Decision detail

Summary

Miss H complained about arrears and missed payment markers on her credit file following voluntary termination of a car finance agreement with VWFS in 2018. She had arranged to repay the remaining balance through a debt charity over six years, completing payment in June 2024. VWFS reported the arrears and missed payments throughout this period and acknowledged one minor error in the count of missed payments, which they agreed to correct. The ombudsman found that VWFS correctly reported the debt status as arrears until it was fully cleared, as the balance was due immediately upon voluntary termination and the extended repayment plan did not constitute an agreed arrangement that would prevent arrears reporting. The complaint was not upheld.

The Ombudsman's reasoning

When a customer voluntarily terminates a finance agreement, the balance becomes immediately due. Miss H arranged repayment through a debt charity over six years rather than paying immediately, meaning payments were technically missed throughout that period until June 2024. VWFS was required to accurately report this to credit reference agencies. The debt could not be defaulted because it was being repaid through an agreed repayment plan. The only error was the miscount of one monthly missed payment, which VWFS agreed to correct. This minor error had no material effect on the credit file reporting.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website