Are you dealing with an A1 coding with the BKR and wondering what this means for you? Would you like to know what your options are with this listing, or to maybe even get rid of it?
This is quite understandable, because the consequences of BKR registration can be drastic. Especially at the times in your life when you least expect it.
At Dynamite Netherlands, we help people like you every day, with clear information, advice on your options and the right help to get rid of your coding. Read everything you need to know about your A1 coding below, or contact us directly for a free, no-obligation consultation.
You probably landed on this page because you are dealing with an A1 code with the BKR and want to better understand exactly what it means. Below we are going to dissect this code step-by-step.
What is BKR registration?
Most people have heard of BKR registration, but do not know exactly what it is until they encounter it. For example, when a mortgage broker recommends checking for registrations.
You may have found out through such a same check that you have a BKR registration, without being aware of it before. You are by no means the only one.
Here's the thing. The BKR - Bureau Krediet Registratie - keeps a record of all Dutch people's debts, credits and loans of €250 or more. What many people do not realize is that this also means that the possibility of standing in the red for that amount is registered: even if you do not use that possibility, it is still a credit that you can dispose of.
A "free" phone worth more than €250 that you get with a subscription is also registered as a loan for the term of the subscription.
As a result, many people find out during a mortgage application that they are registered at all. In many cases, this is easily resolved, but in the case of an A-coded mortgage, it is different.
To understand that, it is important to understand the meaning of that A-coding.
The meaning of an A code: from positive to negative registration
When a debt, credit or loan is registered with the BKR, it is initially a positive registration. This means that the loan itself and the creditor are recorded, but otherwise there is not much else going on.
Another lender may see that you have a payment obligation. This may affect the amount of mortgage you can get. This is only natural: after all, having a payment obligation means you can carry fewer fixed expenses per month, so it makes sense that you can carry less mortgage.
The consequences are greater when there is a delay in repaying the loan. The positive registration is then converted to a negative BKR registration, identified by a so-called particularity code added to the registration:
An A(Arrears Notification) indicates that there is a late payment on the relevant record
Thus, such a particularity code shows that you have or have had payment problems.
So what does an A1 coding mean?
Thus, an A code on your BKR registration indicates that there is a delay in repayment of the loan in question. Often you will also see a number with the registration.
That number says something about the nature of the arrears. For example, in this case the "1" indicates that an arrangement has been made with the lender to repay the debt. This makes it a relatively mild negative registration: after all, a good solution has been found.
In turn, an A3 coding indicates one of the heaviest BKR codings: in fact, this addition indicates that part of the debt has been written off. Often this is a sign that the creditor was no longer confident of recovering the full original amount.
Thus, an A1 notification means that there is active arrears on the registered loan, but arrangements have been made to resolve the arrears.
The concrete consequences of A1 coding
The summary of your loans and debts that the BKR entails is transparent to other credit and loan providers. In fact, the main reason behind the summary is to protect individuals from debts or loans they cannot carry.
This, of course, is very positive: it prevents people from getting into irresponsible debt.
The downside, however, is that a BKR registration remains visible for five years after the full amount has been repaid. That means it also remains visible for five years that there were payment problems.
Here we briefly discuss the two most common situations that this affects.
Borrowing money with A1 coding
You will understand that it is virtually impossible to borrow money with an A1 code. After all, that registration indicates that you are still in arrears elsewhere.
That not only depresses your disposable income, it also makes you a risk in the eyes of lenders.
If you have repaid the loan in full, then the loss of your disposable income is no longer an issue. Unfortunately, then - as we have seen - it still remains visible that there was arrears. This is because the A coding has been replaced by the H, which indicates that there was arrears that have been cleared.
So you still remain a risk in the eyes of future lenders, even if the arrears were years ago and you are now much healthier financially. That makes borrowing money difficult, or means you have to pay a higher interest rate, for example, than you would have without the coding.
A1 coding and mortgage lending
Closing a mortgage with A1 coding is a difficult task. Again, because of the risk that the arrears mean to lenders, but also because of the additional payment obligations of the arrangement made.
The latter applies to any outstanding loan or credit. Also positive BKR registrations. And even for debts that are not registered, such as student debt. Because you owe monthly repayments , you'll have less income left over to repay your mortgage debt, which means you can borrow less.
And again, even after full repayment, you will still have to deal with the fact that it remains visible that the debt was there. Which in turn affects the maximum amount you can borrow or the interest rate you pay.
In the worst case scenario, such a past debt can even prevent the purchase of a house that seemed to be in the works. The amount you initially thought you could borrow will suddenly not be granted because an A1 coding from three years ago suddenly surfaces.
How can I get rid of my BKR A1 report?
Watch our 2-minute corporate video with Mr. Frank Visser about our approach.
The only way to get rid of your A1 coding is to repay your debt. Unfortunately, this does not completely close the case. As you have read above, the A1 coding can block your dreams for another five years .
Fortunately, something can often be done about this.
In fact, in many cases it can be very well demonstrated that the five years that a registration remains in place is too long and has a disproportionate impact on your life. For example, if the coding is interfering with your mortgage application.
Every day our lawyers help many people in such situations so that they can get on with their lives again. Naturally, we would like to do the same for you, which is why we are happy to work with you to see what your options are.
Is your life also held back by an A1 coding from the past? Then don't hesitate to seek free, no-obligation advice from us on how to resolve it.
