     KEN HORTON | Tuesday, November 02, 1999 - 06:25 pm 
Hi! I am newcomer to the forum. I am trying to re-finance my 1st mortgage and have cleared up all my old bad credit except for one creditor. I had a First Card that was opened in 6/91 and was charged off in 2/93. This was reported by TRW on 3/14/95.
However, First American Credco reports that the account was purchased by a Unifund Corp/Oh
( Unifund Corp of Ohio)and is now showing up on my credit file as a charge to loss of almost $14,000. The amount charged off by First Card was only $5, 687, which I thought at the time was outrageous since I had only a high credit of $3,200-which I never reached.
My question? Is this allowable? I had thought that the First Card was to be removed after 7 years, and now the mortgage lender tells me that this is not true. I have the feeling that the lender and Credco and Unifund are all in cahoots.
I ungently need to re-finance the 10% loan on the home and make some needed repairs, but I am at a loss as to my next step. |
| rbielak | Wednesday, November 03, 1999 - 07:21 am
By law, all trade lines surrounding the debt can only remain for seven years from the ORIGINAL DELINQUENCY DATE - this is the date that the first payment was missed prior to the account NEVER AGAIN becoming current. Now, creditors are required to report this original delinquency date with each trade line entry. The problem is that, years ago when yours first went on, they never HAD to report it, so they had to come up with one. If they charged it off, then they sometimes modify the original delinquency date to be that of the charge off date, which can be disputed in some cases and not others, depending upon the creditor, and depending upon how thorough the credit reporting bureau is. Contact the credit reporting bureau(s) that have the trade line(s) on your report and dispute ALL of the items related to the ONE card (collection agencies, transferred account, original account) based on an inaccurate original delinquency date. If you have documentation that proves the item was charged off in 2/93, then you should have no problem whatsoever - just contact them and then either fax or mail per their request. Do this with each of the three bureaus (Trans Union, Experian, Equifax). With the proper documentation, they will remove it immediately. But if the collection agency/whoever continues to report it, you'll have to address it with them - send them the proof that you have regarding the 2/93 charge off and then tell them that the Fair Credit Reporting Act requires EVERYTHING related to a single charge off to remain no more than seven years from the ODD (or at worst, the charge off date). They can NOT, and I repeat NOT, reset the seven year clock simply by purchasing the debt. They would be breaking the FCRA law if they did this. Don't let them try to fool you, either. They'll tell you anything they can to get you to pay whatever you have. Be stern, don't take any bull and repeatedly quote or reference the Fair Credit Reporting Act. Most collection/creditors will eventually give in (as they should).
As for why the balance is so high -- even if a company charges off your debt, they are still legally able to collect the debt at a later date. They are also legally allowed to charge a reasonable amount of interest on any unpaid balance. I had a repo charge off that was originally $4800 that worked it's way up to over $8000 because I let it sit so long.
I had about $18k in 6.5 year old debt that I had to pay off in order to obtain my mortgage. All were charged off years and years ago, but I still owed them. I contacted them, made settlement agreements (30 cents on the dollar, 50 cents on the dollar, whatever you want) and most were willing to accept because at least they were getting SOMETHING after 6.5 years instead of NOTHING. I spent $8500 on that $18k debt, but everything is now settled.
Good luck. |
| Christine Baker | Wednesday, November 03, 1999 - 10:25 am
I agree, except for one "little" thing:
Guilty until proven innocent?
I thought it was the other way around, that the CREDITOR had to prove that their reporting is correct. |
| Sean | Wednesday, November 03, 1999 - 12:04 pm
I must disagree with the previous posters. The debt can stay on your report for 7 years from the date it was originally sold; provided, however, that the date was originated before the FCRA was amended in 1997.
There was not enough information in your post for me to determine if the 7 years had passed but there is enough information to determine that the debt originated under the old Fair Credit Reporting Act. Old practices were grandfathered in under the new act.
You should still dispute it and I believe Experian customarily puts on their report when they anticipate the debt will fall off. |
| Robert Bielak | Monday, November 29, 1999 - 09:55 am
Sean -
I had four items that went delinquent/charge-off in 1992-93 that were sold to other companies between 95-96. These new companies reported them as their own. I disputed the original trade lines (they no longer owned the debts), then ALL of them were removed. At the same time, I disputed the original delinquency date on each of the NEW trade lines. I also spoke with each of the four new owners of the debts. ALL four NEW companies began reporting the OLD original delinquency date and, after seven years from the OLD date, ALL trade lines were deleted, never to return.
If your reasoning is correct, items originating before 1997 could actually remain on the credit report indefinately, never falling off, because it could be sold and resold every five or six years. That's not the case.
Know the law. Use the law. I did. It works. |
