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Long-term financial impacts of coerced debt

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Please note: the following contains details of domestic abuse, including violence, and mentions of suicidal ideation, self-harm and suicide attempts, which some readers may find distressing.

Impacts of coerced debt on credit files   

A significant theme that emerged from previous research was that victim-survivors felt particularly aggrieved by the long-term impacts of the coerced debts being reported on their credit files.

One of our clients, Liz, for example, told us that, because of her diminished credit score, it “felt like a life sentence.”

Fig. 9: Impacts of coerced debt on credit files     

  Total Male Female Additional vulnerability
My score fell 40% 32% 49% 50%
Defaults on loans, credit cards or other types of credit 14% 10% 17% 18%
Missed payments on loans or a mortgage 10% 10% 10% 12%
Being put on an insolvency or debt solution 7% 5% 9% 8%
One or more County Court Judgement (CCJ) 7% 5% 10% 10%
Flagged on fraud databases or having fraud markers 1% 1% 1% 2%

Around half of respondents (48%) experienced at least one negative impact on their credit record. Just over a fifth (21%) experienced two or more negative credit impacts. So, not all people with coerced debts experience negative impacts on their credit record, which suggests that many of them must be keeping up with their repayments.

While this is positive for their credit records, it is not a good outcome for victim-survivors of domestic abuse if they are paying back coerced debts.

Women were disproportionately affected. Over half of women (56%) experienced at least one negative impact on their credit record, compared with two in five men (40%). A quarter of women (25%) reported at least two negative impacts, compared with 18% of men.

People with additional vulnerabilities were also particularly affected. Nearly six in ten (59%) experienced at least one negative impact on their credit record, and more than a quarter (27%) experienced two or more. This highlights how vulnerability can amplify financial harm, leaving individuals facing long-term barriers to financial stability and recovery.

Qualitative responses we received on this question threw into sharp relief quite how much victim-survivors were impacted by the credit file impacts of their coerced debts.

One female victim-survivor, for example, wrote: “My credit score went down so much that I can’t get anything on credit, not even internet or a mobile phone now.”

The figure was similar across men (32%) and women (39%), but we saw greater discrepancies among other groups. For example, 44% of parents with children under the age of 18 were declined at least one product and 37% of parents of children over the age of 18 (were declined at least one product, compared to 27% of those without children. The figure was also higher among those in receipt of Universal Credit (54%) than those not receiving UC (31%), and higher among renters (51%) compared to owners (27%). The figure jumps for those with additional vulnerabilities (45% experienced at least one negative impact).

 Respondents who were declined products in the last three years due to problems with their credit rating   

  Total Male Female Additional vulnerability
A loan, credit card or other consumer credit 27% 23% 32% 36%
A mobile phone, internet or telephone contract 9% 8% 9% 12%
Renting a home, i.e. the landlord/estate agent requested a credit check which you did not pass 5% 4% 5% 6%
A mortgage 6% 6% 6% 8%
Getting a job or paid work, i.e. where successful appointment to a role was subject to a credit check 3% 4% 1% 3%

Over a third (35%) said that they were declined for at least one financial product or service, such as a loan or credit card, internet or mobile contract, or a tenancy, mortgage or job, due to problems with their credit rating.

The figure was similar across men (32%) and women (39%), but we saw greater discrepancies among other groups. For example, 44% of parents with children under the age of 18 experienced at least one negative impact and 37% of parents of children over the age of 18 (experienced at least one negative impact, compared to 27% of those without children.

The figure was also higher among those in receipt of Universal Credit (54%) than those not receiving UC (31%), and higher among renters (51%) compared to owners (27%). The figure jumps for those with additional vulnerabilities (60% experienced at least one negative impact).

Would you like to find out more?

Email us to discuss or request more information about this report at policy@stepchange.org