A Hampshire woman was left aghast after her mortgage application was rejected due to an outstanding £3.99 delivery charge that she had forgotten to pay.
Kelly Miles, 33, discovered a “big red mark” on her credit file when she and her ex-partner sought to buy a new home.
Unaware of the cause, Ms Miles investigated, and was shocked to discover that the missed payment was the sole reason for her inability to obtain a mortgage.
The charge stemmed from a “buy-now-pay-later” scheme that she had used a year prior to purchase an iPad mini as a birthday gift.
Despite successfully repaying the £500 cost of the device within the stipulated six-month period, the small delivery fee remained unpaid, leaving a big blot on her financial record.
Ms Miles, a mother of two, discovered that the delivery charge for the iPad had been missed off the re-payment plan – and she was unable to take out a mortgage for six years as a result.
The advice charity manager is urging others to check their credit score every month to avoid the same mistake.
Your credit score reflects how reliable you are with credit and affects your ability to borrow money.
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Credit scores weigh up many different pieces of information, including previous credit applications and payments.
Ms Miles, from Portsmouth, Hampshire, said: “Young me decided I wanted to get my ex-partner an iPad mini and I bought it on a buy now pay later.
“That part of it was fine, it was on a six-month agreement and I paid it in six months.
“Me and my ex lived in a rental property at the time and the landlord wanted to serve us notice on that rental property.
“We wanted to buy so we went ahead and put the mortgage application in, which is when we discovered this big red mark on my credit file.
“It turned out the iPad mini that I’d bought on buy now pay later had a £3.99 delivery charge to be sent to me, which apparently I didn’t pay at the time of purchase.
“But I never had notification of this – I don’t remember seeing a single letter.
“Basically this £3.99 charge that I hadn’t paid for delivery had been put on as a mis-payment so I’m meant to have paid it, but each time I’ve missed the payment, it’s put that massive red mark on my credit file.
“On that basis I couldn’t get accepted for a mortgage and my ex-partner had to buy the house without me.”
Ms Miles said that she felt “disappointed” when she found out about the mishap, which left her unable to take out a mortgage for six years.
“I was really surprised – it didn’t spring to mind at all [when we first found out about the red mark], I had to do some investigating through my file to find out what it was.
“I was frustrated because it was out of my control, I couldn’t go in and suddenly edit it or something.
“I was disappointed and I was annoyed in the sense that someone could put that mark against my name without me having any knowledge or awareness of it.”
She said she had to be more careful with other credit too, because “my chances of getting refused then for credit were higher which would then just pose more marks on to my file”.
The experience put her off using buy-now-pay-later schemes, and she is now more conscious of her credit score.
Ms Miles said: “Before then though I was never in any debt – this was the only buy-now-pay-later thing I’d ever bought, so I almost had no reason to check my credit score regularly.
“We’re looking to buy next year so I’m very conscious of my credit score at the moment and making sure that there’s nothing creeping up on there.
“I’m not someone who’s in debt so you would always automatically assume that your credit score must be good, but it wasn’t.”
She is now urging other people to check their credit score regularly, especially if they have taken out a new product like a buy now pay later scheme, credit card, or loan.
“You need to check quite soon after you’ve taken it out how that has been placed onto your credit file – checking that the information on there is correct.
“I check my credit score at least once a month now.”