BOS error ruined my credit score

Bank of Scotland made a mistake over a loan. It agreed to waive the remaining interest and to absorb one payment. In total this was a concession of about £1,500.

We signed an acceptance form, which the bank apparently lost and then found.

Meanwhile, without any word from the bank, we were contacted by a collection agency.

After that the bank said we should have reinstated the direct debit of loan repayments, when I felt that was for the bank to do.

Much as we tried we were unable to get any help from the bank. We began paying the loan to the collection agency.

Our credit rating plummeted and affected our ability to borrow.

The bank refuses outright to repair our credit score. SS, WEST LOTHIAN

In 2014 the bank asked you to come in and discuss a loan you had. The bank clerk then advised that the loan, which you had taken out years earlier, had been paid in full. You disputed this.

The same information was given to you on another two occasions: that all of the loan had been paid. You were advised to take out a new loan to cover your overdraft and to cancel the direct debit in respect of the first one. You did as advised.

Some weeks later you were contacted by the bank to say the first loan, which had supposedly been paid off, was in arrears.

It transpired that the bank employees had looked up the information and consequently had given wrong advice.

You were confused over how the direct debit should be reinstated. The bank said it had explained that you were responsible for doing this or setting up a new method of payment.

However, you thought that signing the offer acceptance form would do this. I feel you could have been better advised.

This and other muddles meant that no payments were made to the original loan until 16 months later.

Your present grievance was over the black mark on your credit rating, which had been perfect until then. This had restricted your cash flow.

For example, you had found you could not borrow to pay for a property extension you had planning permission for, which has now expired.

Your business account manager with a different bank explained that, under the circumstances, it wasn’t able to help you.

Bank of Scotland gave you the option to contact the Financial Ombudsman Service (FOS) and extended this by a further six months when you didn’t take it up. By the time you wrote to me the deadline for this extension had also expired.

You recognise that you owed £5,000 for the original loan and are paying it off at £150 a month.

The bank, when I first contacted it, remained satisfied that it had been fair and reasonable.

However, as a gesture of goodwill, it offered you a further six-month period within which to contact the FOS.

As your and the bank’s version of what had happened differed somewhat, I urged you to do this. The result was that the FOS ordered the bank to reverse the default.

You wanted a letter from Bank of Scotland exonerating you. It said the ombudsman’s ruling letter was sufficient and it hasn’t sent one.

The Bank of Scotland said that, following a review, the FOS agrees that the compensation paid to you was adequate.

It has apologised for the initial error and removed the default from your credit file.

Bank of Scotland, based in Edinburgh, is a subsidiary of Lloyds Banking Group