How do defaults impact your credit file?

Learn how defaults affect your credit file, how long they last on your credit file, and ways you can reduce their impact.

Couple sitting in front of a laptop discussing finances

Written by Hayley Bevan and Victoria Smith

Published on February 17th, 2026

Last reviewed on February 17th, 2026

6 mins read

Understanding credit cards

Defaults not only damage your credit file, but they can also make it harder to secure future borrowing. If you currently have a default on your file, it’s important to remember nothing’s permanent. And with the right financial guidance, you can get things back on track.

In this guide, we’ll explain what a default is, how long they stay on your credit file, and how they impact your ability to secure future credit. You’ll also learn some practical ways to avoid or bounce back from a default.

What is a default?

Whether it’s with a bank, utilities supplier, or a mobile phone company, a default occurs when a provider closes your account due to a series of missed payments (usually over the course of three to six months).

It’s important to remember a default can occur with any overdue credit amount, be it a missed payment for a small purchase or a significant amount of debt accumulated over several months.

For that reason, you should manage your credit responsibly by spending within your means, making payments on time, and only borrowing what you can comfortably afford to repay each month.

Does a default damage your credit?

A default negatively impacts your credit score and ability to secure credit, be it for a mortgage, personal loan, or a finance agreement for a new piece of living room furniture.

Whenever you apply for credit, lenders will check your file to assess how likely it is you’ll make repayments on time. If they spot a default on your file, it could signal you’re struggling with your finances and are a higher risk for lending.

Even if your application is accepted, it could be the case that you’re subject to higher interest rates and lower lending amounts. Both of which are put in place to mitigate the risk of lending to you.

How long does a default stay on your credit file?

A default stays on your credit file for six years, even if your debt is cleared during this time. After a default is removed from your file, it can’t be re-registered by a lender – even if you still owe money.

However, should you continue to leave a debt unpaid, your lender might decide to register a county court judgement (CCJ) against you, further harming your credit score and ability to secure credit.

That’s why it’s important to pay off what you borrow as soon as possible. If you need support to get your finances back on track, you might consider seeking professional advice.

How to check if you have a default on your credit file

A creditor is legally required to send you a default notice before a default is recorded on your credit file. As part of the notice, you’ll be advised on the consequences for missed payments, as well as officially notified to pay off what’s owed within 14 days.

As part of the notice, you’ll also be informed a default will be recorded on your file if your balance goes unpaid beyond the stated deadline. It will also inform you of other steps the creditor might take, such as selling the debt or pursuing court action.

If you’re unsure as to whether a default has been recorded on your credit file, you can get a copy for free using online tools such as Clearscore, Money Saving Expert, or any other provider linked with a major credit reference agency (Experian, Equifax, TransUnion).

As part of the service, you can usually view your report immediately online. Or, if you prefer, it’s often possible to request a copy by post. In both cases, look for any entries showing a ‘default’ status and make sure they’re correct.

How to remove a default from your credit file

If there’s an inaccurate record of a default marked on your report, you should raise a credit report dispute with your chosen credit reference agency immediately.

Once the agency has received the report, they’ll investigate the issue directly with your lender and add a ‘notice of correction’ to your report while the investigation takes place.

As part of the process, you can also contact the lender with proof of making payments on time or clearing the entire balance of your debt within the agreed timeframes.

Should the lender realise their data was incorrect, the default will be removed from your report. In situations where the data was accurate, the default will remain and you’ll be provided with information on your options.

In cases where you’ve cleared your debt after a default has been marked on your credit report, the default will remain on your file for six years.

Can you reduce the negative impact of a default on your credit file?

Even if you have a default on your credit file, there are ways to reduce the impact it has on your credit score and ability to secure future borrowing.

Repay debt as soon as possible: By clearing your debt, a default can be marked with a ‘satisfied’ status on your file which is better received by potential lenders.

Offer an explanation: Request a credit reference agency to add a note against your default which explains the circumstances that led to debt (e.g. long-term illness or redundancy).

Take your time: As time passes, a default ages which might mean it becomes less relevant or concerning to possible lenders assessing the risk of borrowing to you.

Improve your credit score in other ways: Take simple steps to improve your credit score, such as getting on the electoral register, cancelling unused credit cards, and checking personal details are accurate on your credit file.

By consistently making payments on time and only borrowing what you can comfortably afford to repay each month, you’ll be on your way to protecting your score and getting your finances back on track.

How does your credit score change once a default is removed?

When a default is removed from your credit file (either by dispute or the six years elapsing), you’ll likely benefit from an improved credit score and ability to secure future credit.

The exact score increase will depend on your credit history as well as the chosen credit reference agency who use varying systems and credit score bands to determine your overall rating.

Once your default has been removed, you should continue to demonstrate responsible lending behaviour. Not only will it lower the risk of other defaults, but it can also open doors to other borrowing opportunities, such as a mortgage or a loan for a car.

Can you get a credit card with a default?

It can be more difficult to get a credit card with a default on your file, but it’s not impossible. Before you make an application, it’s best to shop around for preferential rates and lending terms that work with your financial situation.

With an Aqua Credit Builder card, you can be on your way to building better credit. Even if you have a default on your credit file, you could still be eligible with access to free tools and support to improve a low score and maintain a healthier credit history.

As an Aqua customer, you’ll also benefit from no annual fees and have access to our Aqua app where you can track your credit score anytime you like – all with just a few clicks. As standard, you’ll also get 24/7 fraud protection to keep your account safe.

Although a default can impact your credit score, it’s reassuring to know it doesn’t last forever. So, even if your finances have taken a turn for the worse, there are still ways to get things moving in the right direction.

If you’re searching for a way to improve your credit score, a credit card for building better credit could be right for you. Take our free eligibility check that’s over in as little as 60 seconds – with no impact on your credit score.

Representative 39.9% APR (variable) on Aqua Classic

Failure to make payments on time or to stay within your credit limit means that you will pay additional charges and may make obtaining credit in the future more expensive and difficult.

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