Credit file – returned direct debit

[alex_l]

Given I’ve been on hold unsuccessfully a few times to Virgin I thought I’d try here.

An unusually large bill this month (house renovations!) meant our direct debit got refunded. Entirely my fault. Virgin notified me two days later by text and I settled the bill in full as normal. My question is will this actually have left a missed payment mark on my otherwise unblemished record?

Their text/app implies there was a grace period to the 15th, T&Cs seem more black and white. The in app chat people couldn’t answer.

[John]

Can’t speak for Virgin but I have paid credit cards 1-2 days late several times (because I was disorganised) and nothing ever came of it, though the most recent instance was about 8 years ago.

[aseftel]

I don’t have any specific knowledge of their internal processes, but what I would expect to happen is that they report the current status of your account once a month to the bureaux. If your account is up to date when they generate the data then that’s what they’ll show and vice versa. Whether they apply a late payment charge is an entirely different matter.

It’s also worth mentioning that your bank should generally be telling you in the morning if they are refusing a direct debit and giving you an opportunity to credit funds before they retry later in the day.

[alex_l]

Yes. Barclays less than useless. No notification of either payment going out or it’s return.

We also have Nationwide and they helpfully notify you the day before of any upcoming adds that exceed funds.

[jj]

I had a similar problem a couple of years ago. The difference was that my bank, NatWest, told me the payment would go through but actually blocked it. I transferred cash from savings and paid the following day, but was faced with a large interest bill that took months to sort out. Eventually, Virgin showed goodwill and refunded it – even though the problem was NatWest’s.

I don’t know if this is true for all Virgin credit cards, but mine is set up to collect the DD on the monthly credit card due date. Most card providers collect DDs several days earlier to allow time for a manual payment to be made of the DD has a problem, but Virgin doesn’t do that. If a payment is even one day late, interest is due on all payments from the original payment date. I had paid a £15,000 deposit for a car about 6 weeks earlier, so the interest payment was substantial.

The cynic in me believes that Virgin operates that policy because it’s very profitable for them when a DD is returned. If your account is like mine, you could be about to receive a large interest charge, I’m afraid.

The only good thing about my story is that nothing bad was reported to the credit reference agencies.

[NorthernLass]

Virgin are pretty merciless. I forgot to change my underlying card on Curve once and withdrew some cash. I was charged £12.50 immediately and daily interest. Fortunately I realised straight away and paid the whole balance off so the total charges were only about £14.

I always pay off my balance well before the DD date, it stresses me too much that they don’t take it until the final day!

[alex_l]

jj wrote:

I had a similar problem a couple of years ago. The difference was that my bank, NatWest, told me the payment would go through but actually blocked it. I transferred cash from savings and paid the following day, but was faced with a large interest bill that took months to sort out. Eventually, Virgin showed goodwill and refunded it – even though the problem was NatWest’s.

I don’t know if this is true for all Virgin credit cards, but mine is set up to collect the DD on the monthly credit card due date. Most card providers collect DDs several days earlier to allow time for a manual payment to be made of the DD has a problem, but Virgin doesn’t do that. If a payment is even one day late, interest is due on all payments from the original payment date. I had paid a £15,000 deposit for a car about 6 weeks earlier, so the interest payment was substantial.

The cynic in me believes that Virgin operates that policy because it’s very profitable for them when a DD is returned. If your account is like mine, you could be about to receive a large interest charge, I’m afraid.

The only good thing about my story is that nothing bad was reported to the credit reference agencies.

Yes. A stinging interest charge has now hit. Trying to raise with Virgin as to me it seems unfair they don’t notify us on the day. Not expecting much.

NorthernLass wrote:

Virgin are pretty merciless. I forgot to change my underlying card on Curve once and withdrew some cash. I was charged £12.50 immediately and daily interest. Fortunately I realised straight away and paid the whole balance off so the total charges were only about £14.

I always pay off my balance well before the DD date, it stresses me too much that they don’t take it until the final day!

I hadn’t twigged until this happened they take the payment on the due date unlike everyone else. Given this, the changes to reward flights and the iOS app only management I think I’ll be ditching it and switching to the Barclaycard avios.

[AndrewT]

Many credit card providers take the DD payment on the due date, Barclaycard certainly do. If that concerns you your choice may be limited.

Amex are the opposite who take it way too early.