Don’t let the postal strike wreck your credit status

Cheques, utility bills and credit card payments, loan payments and mortgage payments may be held up or returned to their senders during the round of postal strikes that are causing backlogs and confusion around the country – and your credit rating could suffer as a result say the money experts who offer money saving tips.

Unless you have set up direct debits for all your regular payments, you could miss a payment or discover too late that the cheque you posted in plenty of time failed to reach its recipient by the latest acceptable date.

The consequences could include late payment fees, the threat of disconnection or of having your line of credit blocked and a record on your credit report showing that you’ve skipped a payment.

Your credit report is the personal history of all your credit accounts, from credit and store cards to your mortgage and mobile phone airtime. Lenders check it when they assess whether to make you an offer and what terms – such as interest rates – to set.

With lending criteria becoming increasingly tight and even a single missed repayment staying on your credit report for up to three years as a warning that you may be an unreliable borrower, the chaos caused by strikes could prevent you getting the deals you need well into the future – unless you take preventative action.

This plan should help.

Go through your credit cards, bank and utility statements online, if you can. Look out for payments sent and received and double check recent statements to see roughly when you should have received a statement or bill and how quickly your payment would normally go through.
Contact your card issuer, lender or utility company if you haven’t received a bill or statement that you are expecting or cannot see evidence in your online statements that a payment has gone through. “Most people know when a statement is due,” says Sandra Quinn of UK Payments, the banking trade body. “If it does not arrive you should contact the company to find the balance and how much should be paid.”
Ask if there is an alternative way to pay. For example, you may be able to pay a cheque in to a local office or via your own bank branch. If you need to use the post, get proof of posting from the post office, so you can prove that you sent payment in advance of any deadline.
Follow up on missing cheques. You may want to cancel any cheques that have not been received after several weeks, in case they fall into the wrong hands.
Challenge penalty charges. “The majority of these charges are generated automatically when a deadline is missed,” explains Ms Quinn. If you do get a charge, contact your bank. They should deal with requests sympathetically.” BT has also said it is trying to give customers extra time.
Protect your prompt payment discount. Some power companies offer a discount for prompt payment, usually within a fortnight of the billing date. If you stand to lose out because of a strike, talk to your service provider, point to your previous payment record and explain the circumstances. The companies have said that they will honour discount promises that have been compromised by the strike.
Check your credit report to see whether any late payments have been registered as a result of the strike – you can see your Experian credit report for free with a 30-day trial of CreditExpert. If the postal strike has left a blot on your credit report, you should contact the organisation that registered the missed or late payment and ask for it to be removed. You can also ask the credit reference agency that holds your report to add a note of explanation that will be seen by future lenders – Experian is the UK’s largest.