Payment default entry

When do I get a payment default entry?

A creditor or debt collection agency usually sends out  debt collection letters (payment reminders and demands) before you get a payment default entry. You will not get a payment default entry simply because you are late with a payment.

You can get a payment default entry in many different ways.

• A creditor can notify a payment default to the credit information register when the payment of a consumer credit is overdue by at least 60 days. The creditor must also mention the possibility of a payment default entry in your credit agreement and send you a written payment reminder in which this possibility is mentioned at least 21 days before the entry is made.
• A payment default is notified by the District Court when it issues a judgement concerning an uncontested claim in which it orders you to pay the debt. The claim is uncontested if it has not been contested as a result of you challenging its grounds or amount in court.
• Payment default entries may also be made during the enforcement phase or
• it may be related to debt adjustment.

On your request, any special reason that led to the payment default entry, such as a guarantee liability, must be recorded in the register. You must be prepared to provide a reliable account of this special reason.

To read more about payment default entries, visit the financial and debt counselling website.

What are the consequences of a bad credit record?

A bad credit record affects your life in many ways.

Examples of the consequences of a bad credit record:

• the credit card company may cancel your credit card
• it will be much more difficult for you to get credit
• it will be more difficult for you to conclude contracts on payments in instalments
• it will be more difficult for you to find a rental apartment and get home insurance, which is usually required by the landlord
• collateral or an advance payment will usually be required for contracts on telephone subscriptions and insurance policies
• it will be more difficult for you to get a job, especially if the task involves financial responsibility.

Even if you have a payment default entry, you have the right to basic banking services, including online banking credentials.

For how long will the payment default entry remain  in the register?

Payment default entries are kept in the register generally for two to three years.

The following payment default entries are removed within one month after the credit information company has been informed that the debt has been paid:

• payment default entry reported by a creditor

• payment default entry established by an authority, for example a payment default entry concerning a judgment by default

• enforcement information

In most cases, however, you must take action yourself to remove the entry.

This is how you can influence the removal of your payment default entry

Check if you have paid the debt that led to the payment default entry.

• If the debt was paid through enforcement proceedings, you can contact the enforcement authority to remove the entry.

• If the debt was not paid through enforcement proceedings, you can inform the credit information company that you have paid the debt. Reliable account of the payment must be provided.

• In case of a payment default entry reported by a creditor, the creditor must inform the credit information company that you have paid the debt. In this case, you do not need to make a notification.

This is how you can get information about the situation of your debt

You can ask the creditor for up-to-date information on the total amount and grounds of your debts. The creditor must give this information to you free of charge. You also have the right to receive an itemisation of your unpaid debts. A reasonable fee may be charged for the debt itemisation if you request it more often than once a year. You can also ask a debt collection agency for information.

This is how you get information about a payment default entry

You have the right to receive information about your payment default entries from the credit information company.

For answers to questions about payment default entries, please visit the website of the office of the data protection authority: Frequently asked questions about credit information (in Finnish).