Need some serious advice

[noreturn]

I have some accounts that were charged off but are now showing 120 days late. have disputed with the cra several times and it has always come back verified.

 

I am prepared to start making payments on these accounts only because the past due amounts are included in my fico score and the simulator says if I pay down these amounts my score will increase.

 

what is the best way to handle this situation? should I send a letter to the OC. Call the OC or what. This is all about getting my scores up.

 

and how can account go from charged off to 120 days lates. this has happened on two accounts after rounds of disputes, my associates and lowes. lowes went from transferred and sold to now 120 day late

[tulipchic]

Paying them will not help your scores if the accounts are already charged off. All you will accomplish by paying now is possibly changing the DOLA and extending the time the accounts will be reported on your CR's.

[SassyinAz]

Tulip,

 

The amount of time a TL reports is from the date of first delinquency that led to the charge-off, that is fixed, and payment will not extend the amount of time it is reported.

 

Agreed, payment won't help the scores -- if you want to pay do a payment for deletion and get it in writing, otherwise you're just throwing good money after bad.

 

Sassy

[tulipchic]

I understand what you're saying, but I thought if she started making payments again it would extend reporting time.

[SassyinAz]

Nup, it would change the last activity date, last payment, or whatever field whichever CRA uses to designate the same, but not the time that it is reported.

 

The date of last activity isn't necessarily the same as the commencement date that is used -- that's a common misconception that we've bought into because it is the way it used to be (prior to the amendments effective in 1998) and the CRA's haven't done much to change the perception, meet their requirements and make sure that the furnishers provide the correct date they are required to use.

 

The difference is whether it was placed for collection or charged-off or anything similar.

 

In addition to the FCRA provisions, there's this FTC Staff Opinion letter:

 

http://www.ftc.gov/os/statutes/fcra/amason.htm

 

February 15, 2000

 

Ms. Alaina K. Amason

14155 Shire Oak

San Antonio, TX 78247

 

Dear Ms. Amason:

 

This responds to your letter concerning the time limitations imposed by the Fair Credit Reporting Act ("FCRA") on the reporting of chargeoff accounts by a consumer reporting agency ("CRA," usually a credit bureau). We list your inquiries on this topic below in italics, with our replies immediately following each item.

 

1. What reporting limits does the FCRA provide with respect to chargeoffs, and how long have they been in effect?

 

Section 605(a)(4), which has been in effect since the FCRA became effective in April 1971, has always prohibited CRAs from reporting chargeoffs that are more than seven years old.(1) Section 623(a)(5), which became law in September 1997, requires a creditor that reports a chargeoff to a CRA to notify the agency (within 90 days of reporting the account) of "the month and year of the commencement of the delinquency that immediately preceded" the chargeoff. Section 605©(1) provides that the seven year period begins 180 days from that date. Both provisions were part of the major revision to the FCRA that were enacted in 1996.(2)

 

2. Is the reporting period extended if (A) the original creditor sells or transfers the account to another creditor, ( the consumer responds to post-chargeoff collection efforts by making a payment on the debt, or © the consumer disputes the account with a CRA? Does it matter whether the 7-year period has expired when any of these events occurs?

 

No. In enacting the new provisions discussed above, Congress intended to establish a date certain -- 180 days after the start of the delinquency that led to the chargeoff -- to begin the obsolescence period. It did so to correct the often lengthy extension of the period that resulted from later events under the original FCRA. Enclosed are two staff opinion letters (Kosmerl, 06/04/99; Johnson, 08/31/98) that discuss the impact of these provisions, and the legislative history relating to their enactment, in more detail. Because the commencement of the seven year period is now described with some precision by the statute, it is our opinion that none of the subsequent events you listed -- sale of the charged off account by the creditor, or a payment

 

3. Since Sections 623(a)(5) and 605©(1) provide new rules for calculating the 7-year period that became effective in 1997, do chargeoff accounts now have different obsolescence periods depending on when the chargeoff occurred?

 

Yes. Section 605©(2) states that the section "shall apply only to items of information added to the (CRA) file of a consumer on or after" 455 days after enactment, or December 29, 1997. Therefore, a chargeoff reported to a CRA on or after that date is subject to the new commencement-of-the-delinquency method of calculating the obsolescence period set forth in Sections 623(a)(5) and 605©(1). On the other hand, a chargeoff reported to a CRA before December 29, 1997, is not covered by the new provisions, as discussed in one of the enclosed letters (Kosmerl, 06/04/99). If a credit account was reported as a chargeoff before that date, the Commission's view has been that it can be reported for seven years from the date the creditor actually charged it off.(3)

 

The opinions set forth in this informal staff letter are not binding on the Commission.

 

Sincerely yours,

 

Clarke W. Brinckerhoff

 

 

--------------------------------------------------------------------------------

 

1. Section 605( provides that there is no time limit applicable to a report made in connection with credit involving a principal amount (or insurance with a face amount) of $150,000 or more, or employment for a salary of $75,000 or more. Prior to September 1997, those amounts were $50,000 and $20,000, respectively.

 

2. The Consumer Credit Reporting Reform Act of 1996 (Title II, Subchapter D, of Public Law 104-280, signed into law on September 30, 1996), made many other changes to the FCRA.

 

3. Commentary on the Fair Credit Reporting Act, 16 CFR Part 600 Appendix, comment 605(a)(4)-2. 55 Fed. Reg. 18804, 18818 (May 4, 1990).

 

Here's the section of the FCRA requiring the first delinquency date be used:

 

http://www.ftc.gov/os/statutes/fcra.htm#605

 

§ 605. Requirements relating to information contained in consumer reports [15 U.S.C. § 1681c]

 

(a) Information excluded from consumer reports. Except as authorized under subsection ( of this section, no consumer reporting agency may make any consumer report containing any of the following items of information:

 

(4) Accounts placed for collection or charged to profit and loss which antedate the report by more than seven years.(1)

 

(1) In general. The 7-year period referred to in paragraphs (4) and (6)(2) of subsection (a) shall begin, with respect to any delinquent account that is placed for collection (internally or by referral to a third party, whichever is earlier), charged to profit and loss, or subjected to any similar action, upon the expiration of the 180-day period beginning on the date of the commencement of the delinquency which immediately preceded the collection activity, charge to profit and loss, or similar action.

 

And here's the section of the FCRA requiring the furnishers to provide that date:

 

§ 623. Responsibilities of furnishers of information to consumer reporting agencies [15 U.S.C. § 1681s-2]

 

(a) Duty of furnishers of information to provide accurate information.

 

(5) Duty to provide notice of delinquency of accounts. A person who furnishes information to a consumer reporting agency regarding a delinquent account being placed for collection, charged to profit or loss, or subjected to any similar action shall, not later than 90 days after furnishing the information, notify the agency of the month and year of the commencement of the delinquency that immediately preceded the action.

 

And, here's the FTC mandated notice of responsibilities that has to be provided to all furnishers by the CRA explaining the same, for those of them that are thick-headed ;-)

 

http://www.ftc.gov/bcp/conline/pubs/buspub...ubs/infopro.htm

 

Credit Reports: What Information Providers Need to Know

 

The Fair Credit Reporting Act (FCRA) is designed to protect the privacy of credit report information and to guarantee that information supplied by consumer reporting agencies (CRAs) is as accurate as possible. If you provide information to a CRA, such as a credit bureau, be aware that amendments to the law spell out new legal obligations. These amendments were effective September 30, 1997.

 

Does the FCRA Affect Me?

 

If you report information about consumers to a CRA, you are considered a "furnisher" of information under the FCRA. CRAs include many types of databases -- credit bureaus, tenant screening companies, check verification services, and medical information services -- that collect information to help businesses evaluate consumers. If you provide information to a CRA regularly, the FCRA requires that the CRA send you a notice of your responsibilities.

 

What Are My Responsibilities?

 

The responsibilities of information providers are found in Section 623 of the FCRA, 15 U.S.C. §1681s-2, and are explained here. Items 2 and 5 apply only to furnishers who provide information to CRAs "regularly and in the ordinary course of their business." All information providers must comply with the other responsibilities.

 

1. General Prohibition on Reporting Inaccurate Information - Section 623(a)(1)(A) and Section 623(a)(1)©.

 

You may not furnish information that you know -- or consciously avoid knowing -- is inaccurate. If you "clearly and conspicuously" provide consumers with an address for dispute notices, you are exempt from this obligation but subject to the duties discussed in Item 3.

 

What does "clear and conspicuous" mean? Reasonably easy to read and understand. For example, a notice buried in a mailing is not clear or conspicuous.

 

2. Correcting and Updating Information -- Section 623(a)(2).

 

If you discover you've supplied one or more CRAs with incomplete or inaccurate information, you must correct it, resubmit to each CRA, and report only the correct information in the future.

 

3. Responsibilities After Notice of a Consumer Dispute from a Consumer --Sections 623(a)(1)( and 623(a)(3).

 

If a consumer writes to the address you specify for disputes to challenge the accuracy of any information you furnished, and if the information is, in fact, inaccurate, you must report only the correct information to CRAs in the future. If you are a regular furnisher, you also will have to satisfy the duties in Item 2.

 

Once a consumer has given notice that he or she disputes information, you may not give that information to any CRA without also telling the CRA that the information is in dispute.

 

4. Responsibilities After Receiving Notice from a Consumer Reporting Agency -- Section 623(.

 

If a CRA notifies you that a consumer disputes information you provided:

 

You must investigate the dispute and review all relevant information provided by the CRA about the dispute.

 

You must report your findings to the CRA.

 

If your investigation shows the information to be incomplete or inaccurate, you must provide corrected information to all national CRAs that received the information.

 

You should complete these steps within the time period that the FCRA sets out for the CRA to resolve the dispute -- normally 30 days after receipt of a dispute notice from the consumer. If the consumer provides additional relevant information during the 30-day period, the CRA has 15 days more. The CRA must give you all relevant information that it gets within five business days of receipt, and must promptly give you additional relevant information provided from the consumer. If you do not investigate and respond within the specified time periods, the CRA must delete the disputed information from its files.

 

5. Reporting Voluntary Account Closings -- Section 623(a)(4).

 

You must notify CRAs when consumers voluntarily close credit accounts. This is important because some information users may interpret a closed account as an indicator of bad credit unless it is clearly disclosed that the consumer -- not the creditor -- closed the account.

 

6. Reporting Delinquencies -- Section 623(a)(5).

 

If you report information about a delinquent account that's placed for collection, charged to profit or loss, or subject to any similar action, you must, within 90 days after you report the information, notify the CRA of the month and the year of the commencement of the delinquency that immediately preceded your action. This will ensure that CRAs use the correct date when computing how long derogatory information can be kept in a consumer's file.

 

How do you report accounts that you have charged off or placed for collection? For example:

 

A consumer becomes delinquent on March 15, 1998. The creditor places the account for collection on October 1, 1998.

 

In this case, the delinquency began on March 15, 1998. The date that the creditor places the account for collection has no significance for calculating how long the account can stay on the consumer's credit report. In this case, the date that must be reported to CRAs within 90 days after you first report the collection action is "March 1998."

 

A consumer falls behind on monthly payments in January 1998, brings the account current in June 1998, pays on time and in full every month through October 1998, and thereafter makes no payments. The creditor charges off the account in December 1999.

 

In this case, the most recent delinquency began when the consumer failed to make the payment due in November 1998. The earlier delinquency is irrelevant. The creditor must report the November 1998 date within 90 days of reporting the charge-off. For example, if the creditor charges off the account in December 1999, and reports this charge-off on December 31, 1999, the creditor must provide the month and year of the delinquency (i.e., "November 1998") within 90 days of December 31, 1999.

 

A consumer's account becomes delinquent on December 15, 1997. The account is first placed for collection on April 1, 1998. Collection is not successful. The merchant places the account with a second collection agency on June 1, 2003.

 

The date of the delinquency for reporting purposes is "December 1997." Repeatedly placing an account for collection does not change the date that the delinquency began.

 

A consumer's credit account becomes delinquent on April 15, 1998. The consumer makes partial payments for the next five months but never brings the account current. The merchant places the account for collection in May of 1999.

 

Since the account was never brought current during the period that partial payments were made, the delinquency that immediately preceded the collection commenced in April 1998 when the consumer first became delinquent.

 

For More Information

 

The FTC works for the consumer to prevent fraudulent, deceptive and unfair business practices in the marketplace and to provide information to help consumers spot, stop and avoid them. To file a complaint or to get free information on consumer issues, visit www.ftc.gov or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. The FTC enters Internet, telemarketing, identity theft and other fraud-related complaints into Consumer Sentinel, a secure, online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.

 

Sassy

[mrskippy]

Since the account was never brought current during the period that partial payments were made, the delinquency that immediately preceded the collection commenced in April 1998 when the consumer first became delinquent.

 

Bingo!!! This is the kind of fodder I need. The more I can show this to Providian, the better.

 

Providian bragged it has never lost an FCRA case, that it is in full compliance with FCRA, etc.

 

I only made "partial" payments to them. Account entered internal collections 07/2002, and was referred to IC Systems 09/2003. It never left collections.

[DocPC]

Dammit Sassy, you made me bust my scroll wheel on my mouse!

 

 

[SassyinAz]

Doc, where's the stamina?????

 

I tell ya mrskippy, your problem remains it was never reported as a collection or charge-off or anything similar, by your own hand, in making seperate agreements with them that you didn't keep. They are only required to provide that date if the information is provided to the CRA.

 

Sassy

[edm]

Any new laws, court cases or events which add or change the foregoing?