Can I Sue? Credit Report Has Huge Errors

[Watsonsbag]

Hi, I am new so please excuse me if this is posted in the wrong area, etc.

We filed BK 13 in 11/01, converted to BK 7 in 1/03, discharged 4/29/03. As an example, the following creditors were discharged in the BK,gave up house--yet their entries on the reports are strange.

Fleet Bank -

On Equifax, shows Bad debt/collection bal. $7922

Similar entry on TU, don't have Experian yet.

Household Bank -

Made us what they called an equity line of credit (BOGUS-as some know they've been investigated and settled with 19+ states for many "unusual" activities); really Secondary Mortgage Loan. This was a $36,000 loan made without any equity to back it.(They claimed the Credit Report they pulled never showed mortgage #2).

They were to be stripped down in the BK 13, but were notified about the BK 7. We heard from the 1st two lenders, but not them.

On Equifax:

Last Report 2/2003:

120+ days past due Balance $0

On TU:

Last Report 2/2003

Collection Account

No mention of either Bankruptcy

I could go on but you get the idea. Entries like these are extremely damaging. My two FICOs are:

550

581

Any thoughts, suggestions etc. would be most appreciated. We can't afford any credit repair firm. And this is just my reports; can't wait until we pull my husbands!

Thanks in advance.

[LadynRed]

What you need to do is write dispute letters to the credit bureaus. Dispute that the accounts that were included in the bankruptcy should show a ZERO balance and 'included in bankruptcy' ONLY. No 'collection account', no 'balance due', none of that is legal.

You may have to send a copy of your bankruptcy creditor matrix and you BK discharge papers to prove your dispute. If they don't correct the entries, THEN you start makeing "sue" noises at them.

[Swede]

<blockquote>Originally posted by LadynRed

What you need to do is write dispute letters to the credit bureaus. Dispute that the accounts that were included in the bankruptcy should show a ZERO balance and 'included in bankruptcy' ONLY. No 'collection account', no 'balance due', none of that is legal.

You may have to send a copy of your bankruptcy creditor matrix and you BK discharge papers to prove your dispute. If they don't correct the entries, THEN you start makeing "sue" noises at them.

</blockquote>

Uhm, am I missing something here........?? Why would she want it to be listed as BK? And why send in proof of BK? How would she ever get rid of the BK of the report? There's PLENTY of people that have successfully removed BK's from their files.

[Watsonsbag]

Thanks for the replies. There are others also, including Sears and a Household Credit Card, which don't show any bankruptcy, only 120 days late. It may be too early for them to show the BK 7, but no excuse for the BK 13, which was filed in 11/01.

Fleet is definitely 100% wrong, and this entry must be hurting my credit. I recently read that credit reports post bankrupty can contain errors to the tune of 45%.

We will be getting my husband's reports tomorrow. His will be even more interesting as it seems they constantly list accounts that never belonged to him.

This is a great board. I appreciate any help. I am disabled and can't think straight a lot of the time. Also added stress really aggravates my disease

[Swede]

I'm still missing it.......why do you want BK on your report? BK is a lot worse than collections/charge offs.

[Watsonsbag]

I found this letter on another message board. Name is deleted:

********** asked me to respond to your Fax transmission of December 26, 1997, requesting our views concerning the legality under the Fair Credit Reporting Act (FCRA) of a credit bureau report of an account that has been discharged in bankruptcy as "charged off as bad debt." We acknowledge receipt of your request, pursuant to the Commission procedure set forth in 16 C.F.R. §2.2(a), for an investigation of the credit bureau.

Section 607( of the FCRA requires credit bureaus "to follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom the report relates." In our view, it is not a reasonable procedure to label an account that has been discharged in bankruptcy as "charged off as bad debt" if the account was open and not charged off when the consumer filed bankruptcy. Such a designation would be inaccurate or misleading, because it would indicate that the creditor had written off the account at the time of bankruptcy when it had not in fact done so.

Thank you for the information and documentation you submitted to us in connection with your request that we investigate this credit bureau's practices. As you may know, it is Commission policy not to comment on the status or existence of any nonpublic investigation.

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

Sincerely yours,

***************************

I am new to all this, so don't know if it pertains or not. But apparently, it is illegal to list a discharged debt as a charge off. Any comments would be appreciated. Thanks!

[Swede]

<blockquote>Originally posted by Watsonsbag

I am new to all this, so don't know if it pertains or not. But apparently, it is illegal to list a discharged debt as a charge off. Any comments would be appreciated. Thanks!

</blockquote>

My question remains........why do you want to list BK on your report? Wouldn't you rather have NO DEROGATORIES? By sending in your BK papers, you're pretty much shooting yourself in the foot because how are you EVER gonna get rid of that then????

[kb9tbq]

Watsonsbag

Most people here don't want to have bankruptcy even showing up on their credit report. If the reporting is incorrect like collection / charge off with balance. They don't take the route to correct it - instead they dispute with the credit reporting agencies that the account "does not belong to them" in hopes that it will result in deletion of that tradeline all together.

Even if the account has been updated showing included in bankruptcy with zero balance - they will dispute "no knowledge of account".

Some people will go a different route and prefere to sue the creditor for incorrect reporting. This can be helped along even further if you had been damaged by the reporting: Like higher interest rate on a loan - or having been declinded credit.

Also everything depends on your situation - and if you have the time for the disputes to see what you can accomplish. Are you in the middle of applying for a mortgage loan at this time?

If you have time - then it is well worth spending an additional 30 or 60 days disputing to see what you can shake loose to improve your credit score.

[Watsonsbag]

We are renting for the first time in 15 years. Our money is going into someone's pocket and doing us very little good. I see homes for sale and grind my teeth. We were never late on mortgage payments in all that time until filing for the BK 7. So yes, we want to get a mortgage ASAP. Be pre-approved if at all possible.

The disputes are worth it because of the large amounts being reported as late or collections. And because one of those lenders is an out and out crook. They've been known to do all sorts of things to get people's scores down deliberately.

This lender was responsible for us losing our home. You bet we want to get their a--!

Thanks for your reply. It is becoming more and more apparent that credit scores are used in order to allow lenders to charge people higher rates--whether they deserve it or not. And all this is smiled on by Congress....

[kb9tbq]

You have 2 choices depending on how fast you want to move. If you have 30 days just for the update - then you send in schedule of bankruptcy that lists all the creditors that where included. This way they get them all in one swoop updated.

But this just updates to show Included in Bankruptcy with zero balance - and does little to improve the credit scores.

If you have a few months to go at this - then dispute everything - no knowledge of account; please remove this listing from my credit report 30 days and you get the results:

Some may get bumped off all together, then you see what is left for 2nd round of disputes. Since these did get verified you look for errors in the reporting and point these out in the next round.

Example would if it is showing collection / charge off with balance then you dispute incorrect status please correct this see what they can come up with. Some creditors may just get it to bankruptcy w/ zero balance - some might drop the ball resulting in further deletions.

So then onto round 3, see what is left over and look for more errors in the reporting.... like balance, past due, incorrect dates.

As you accomplish deleting the bad ones, your score should start to improve a bit as you go - putting you in a better range for getting loan.

Now if you are going for FHA or VA loan / lenders are not so score driven as others - and a quick fix may just do for updating instead of pushing for deletion. But the balances showing up have to reflect zero, before the creditor will work with you. Don't matter to them so much how you accomplish this. For the best results though you rather these be deleted then updated.

Be sure when shopping around for mortgage: not to let the lender pull your credit report. Show them instead a copy of your credit report and ask them what their take is from this & what they suggest you accomplish before being ready to apply for the loan later.

[LadynRed]

While I realize that many people have managed to get a Bankruptcy completely deleted from their credit reports, the fact remains that bankruptcy ic a matter of public record and will remain so for at least 10 years.

Some people may have had success in getting a BK removed, there is NO guarantee that its going to STAY off - its a public record, its easily 'found' again, and LEGALLY correct if put back on your credit report.

My take on it - its a crap shoot. You could get rid of it for a short time, but the truth is its likely to come back again.

[Swede]

<blockquote>Originally posted by LadynRed

While I realize that many people have managed to get a Bankruptcy completely deleted from their credit reports, the fact remains that bankruptcy ic a matter of public record and will remain so for at least 10 years.

Some people may have had success in getting a BK removed, there is NO guarantee that its going to STAY off - its a public record, its easily 'found' again, and LEGALLY correct if put back on your credit report.

My take on it - its a crap shoot. You could get rid of it for a short time, but the truth is its likely to come back again.

</blockquote>

Sure but by sending in supporting documentation regarding the BK, you can be sure it won't be removed. There's no guarantees that anything here is going to stay off your reports but I don't think that's reason not to try to have it removed. That's why we're all here.

[LadynRed]

Well.. let me put this into MY perspective... I have no idea what my scores are at this moment, but with at least 6 charge-offs and a foreclosure from 2 years ago, my scores are completely in the sewer. I do have a relatively long history of pretty good credit, but the last 5 years have been a disaster, credit-wise, to say the least. So, from MY perspective, a bankruptcy (which I plan to file about Sept.) can't possibly make them any lower than they are now and certainly can't hurt me any more than waiting for a 6 year SOL to run out (5 more years to go !) with all those charge-offs and forecloure sitting there for 6 more years (only 5 on the foreclosure).

Even with a bankruptcy, at least there's no more threat of lawsuits hanging over my head, no collector jerks calling me, and I have a clean slate on which to rebuild my credit. The impact of bankruptcies fades over the years and I'm sure as heck in NO rush to have a mitt full of credit cards for ANY reason. As for a house, with a bankruptcy, but squeaky clean credit for 2 years post-discharge, I could qualify for an FHA loan. With a foreclosure and all those degogs, I can forget getting ANY kind of mortgage until ALL of that crap drops off at the 7 year mark.

So.. its a possible 2-1/2 year wait for another home vs. 7-10 years .. logic says to me that 2-1/2 years is FAR easier to take than 7-10.

Anyway, that's how I view the situation of a bankruptcy on my credit report. I'd rather live with the BK and get the derogs off to get the 'squeaky clean' post-discharge credit.

[Edit by LadynRed on Monday, June 2, 2003 @ 12:20 PM]

[Watsonsbag]

You are so right about the bankruptcy. The derogs can often turn out to be much worse.

If my husband's and my accounts are cleaned up to show the ones that should read "included in BK" with 0 balance and the incorrect derogs are removed, that's a much better position to be in.

And there are companies that will give somewhat decent mortgages very soon after discharge. On another board, a person very fresh out of discharge got a $150,000 mortgage doing a 80/20--80 at 6%; 20 at 11.5 with ability to refi after 2 years if no late payments.

Some mortgage lenders are realizing that people fresh out of BK with few or no bills are in a better position then those with high FICO but paying on 5 or more credit cards that are nearly maxed out. The first imperative for anybody is to keep a roof over their heads, and the mortgage is the one bill that almost everyone will see gets paid.

About disputing, I like the working to "correct reporting status" without mentioning the BK. If they don't comply within 30 days the account drops off and it's a help with the score. If they wise up and report the BK; well, that would be the truth and be accurately reported, although not helpful score wise. But asking in that manner does leave the possibility that they might not report in a timely manner. Thanks for the insight; it makes sense!

[Anonymous]

<blockquote>Originally posted by Swede

I'm still missing it.......why do you want BK on your report? BK is a lot worse than collections/charge offs.

</blockquote>

chargeoffs are actually worse. I disputed some items that stated included in bk as "not mine". 30 days later later 4 items came back as chargeoff or written off. My equifax score plunged from 609 to 564. A bk looks better than a chargeoff because lenders understand that chargeoffs mean a creditor can come back and make some noise. I have a huge problem now with equifax. I may re-investigate and reverse myself and say included in bk or claim some sort of temporary insanity. This disputing process is like a drug addiction.

gh

[Edit by godhelpme on Wednesday, June 4, 2003 @ 12:15 AM]

[Edit by godhelpme on Wednesday, June 4, 2003 @ 12:16 AM]

[Watsonsbag]

Not just an addiction; it can drive us crazy. Our heads get filled with numbers that swirl around.

A bankruptcy is a bankruptcy. Creditors expect to see account with the BK notation. But you are right, these charge-offs look much worse.

On one report it lists if a negative entry hurts the score. Of course, the official bankruptcy notation does. But any account listed as included in the BK is bad but doesn't affect the score. The 3 accounts showing collections/charge off/bad debts have a "yes" about affecting the score. So there is the actual answer as to how these things are looked upon.

All 3 on my report are wrong and should have been included in the bankruptcy. Getting ready to dispute and will see what happens.

I even dream about this stuff.

[alan2k032003]

In my case, I found there is a fraudulent account on my credit report while I am in mortage load process. I submitted dispute 30 days ago, but this negative record still shown on my credit report. Can I sue the credit report bureaus? Where to find the laywer who is experter on this kind of case?