Will A Claim Repair My Credit File?
A successful unaffordable lending claim normally produces credit-file corrections alongside the cash refund. Adverse markers linked to the unaffordable lending — defaults, late-payment markers, arrears records — are usually removed. The result can meaningfully improve your credit standing, particularly where the unaffordable lending was the main source of damage on your file. This page sets out what gets corrected, what does not, and how the mechanics work.
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What is normally corrected
Where a complaint is upheld, the lender is typically required to:
- Remove default markers linked to the unaffordable lending.
- Remove arrears records and late-payment markers from the relevant period.
- Where the entire account is found unaffordable, remove the account record altogether.
- Where only later parts of the lending are upheld (later loans in a sequence, later credit limit increases), correct only the corresponding portion of the account history.
- Update the credit reference agencies (Experian, Equifax, TransUnion) directly.
How long the correction takes
The typical sequence:
- The lender confirms acceptance of the offer or the FOS decision.
- Within 28 days, the cash redress is paid.
- Around the same time, or shortly after, the lender notifies each of the three credit reference agencies of the corrections.
- The agencies update your file, typically within 4-6 weeks of receiving the lender’s notification.
- Your credit score, where you have one through Experian, Equifax or a free service like Credit Karma or ClearScore, may take a further few weeks to reflect the change as the file is rescored.
End-to-end, allow 6-10 weeks from acceptance for the credit file to be fully updated.
What is not corrected
A successful affordability complaint corrects markers linked to the unaffordable lending. It does not correct:
- Markers from other accounts with other lenders, even if your overall financial difficulty was caused or exacerbated by the unaffordable lending.
- CCJs (county court judgments) — these are public-record entries on your file and are not removed by an affordability complaint.
- Bankruptcy, IVA, DRO entries — also public-record and unaffected.
- Information about searches and applications you have made.
- The credit-file entry for the principal portion of any lending that was found affordable (for example, the original lending where only the increase was upheld).
Specific scenarios
Account already defaulted and sold to debt collector
If the account had defaulted before the complaint and was then sold to a debt collector (Lantern, Cabot, Lowell, Intrum), the credit-file entries from both the original lender and the debt collector need to be addressed. The original lender’s entry should be corrected by the affordability finding. The debt collector’s entry — if any — usually follows, but may need a separate prompt. A successful complaint should prompt both.
Account paid off in full but with prior arrears
Where the account was paid off but had earlier arrears recorded, those arrears markers can be removed if they relate to the unaffordable period. The account itself, having been satisfied, may continue to appear on your file as a closed satisfied account — which is generally a positive entry, not a negative one.
Account written off
A written-off account typically appears with a “partially satisfied” or “settled” marker indicating the lender accepted less than the full balance. Where the underlying lending is found unaffordable, the marker should be corrected, and the entry may be removed entirely if all the lending is upheld.
Persistent debt and credit limit increase claims
For credit cards where only certain limit increases are upheld, the credit file impact is more nuanced. The account remains on file, but adverse markers from the period of unaffordable use are removed, and the corrected balance history reflects the lower (affordable) limit position.
Checking your credit file after settlement
About 6 weeks after settlement, check your credit file. Free statutory reports are available from each of the three main credit reference agencies. Look for:
- The expected corrections to the relevant account.
- Any default or arrears markers that should have been removed but haven’t been.
- The correct status of the account (closed, satisfied, or removed).
- Whether the corrections have been replicated across all three agencies — sometimes a lender will update one or two but miss the third.
If something is missing, contact the lender first to ask for the correction. If they don’t resolve it, you can raise a notice of correction directly with the credit reference agency, or refer the failure to comply back to the Financial Ombudsman.
How much will it improve my credit score?
There is no fixed answer — credit scores are influenced by many factors, and the impact depends on what else is on your file. Removing a default marker has a substantial positive effect, particularly if the default was the main negative entry. Removing late-payment markers helps to a lesser extent. Where the unaffordable lending was a small part of an otherwise damaged file, the improvement may be modest; where it was the main issue, the improvement can be significant.
The credit score improvement compounds over time as the corrected file ages — fresh applications use the corrected data and your overall credit utilisation, payment history and debt position improve.
Related guides
- What happens after you make a claim
- How redress is calculated
- What if you still owe the lender money?
- Claiming while on a DMP
- Do I have an unaffordable lending claim?
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