Negative reporting on discharged debts - UPDATED

[LadynRed]

Bankruptcy is public record. Even if you succeed in getting it removed, there is no guarantee that it will not come back, since the bankruptcy IS a statement of fact.

Follow the dispute process as outlined - dispute with the CRA, then dispute directly with the furnisher of the information. Anything else means you forfeit your rights under FACTA. If they still refuse to report correctly SUE THEM.

[OMGWhatHaveIdone]

Okay, I read the very first post in this thread and sorta understand it, but as I read deeper into the thread, I'm getting lost. I'm a visual learner, and as such, I find I have to read things over and over again in order to understand it.

I wish I could have someone sit down with me and look at my credit reports and tell me what's what.

[LadynRed]

What is it that got you lost ?

[OMGWhatHaveIdone]

Well, I'm confused about things that I've read regarding the whole bankruptcy thing and the credit reports.

If I understand correctly, I have to have my ch 13 discharged First before I can challenge any discrepancies with the 3 CRB's? Or, can I look at what's on there now and say, hey, my BK was filed in Feb 08, yet there's CO's after that date... then take action from there?

I'll have more questions after I write them down and then I can post them in the appropriate place. I'm just too confused today and I can't focus on what I need to.

[LadynRed]

I have to have my ch 13 discharged First before I can challenge any discrepancies with the 3 CRB's?

No, you can dispute anything on your CR's that is not accurate, even while in a Ch 13 - the tradelines should say IIB a Ch 13 or 'wage earner plan'. If the BK filing date is wrong, dispute it.

[OMGWhatHaveIdone]

No, you can dispute anything on your CR's that is not accurate, even while in a Ch 13 - the tradelines should say IIB a Ch 13 or 'wage earner plan'. If the BK filing date is wrong, dispute it.

So then the tradelines should show a zero amount too correct? What about if a CA does a hard pull on your CR after a bk has been filed? Is that illegal as well? They know you're trying to clean up your credit and get out of debt, so wouldn't the inquiries do damage to the credit score?

[LadynRed]

What about if a CA does a hard pull on your CR after a bk has been filed?

Might be a gray area, although if they did not file a proof of claim to get paid, then I suspect they have not right to pull your reports as they have basically allowed the debt to be discharged - no POC - no money.

wouldn't the inquiries do damage to the credit score?

Minimal at best, since the BK is going to tank your score no matter what.

As for balances being reported as 0 - if the creditor has not filed a proof of claim, then the debt will be discharged and reporting a zero balance makes sense. If it's a creditor that is getting paid thru the BK, reporting a balance probably isn't a violation.

[OMGWhatHaveIdone]

Might be a gray area, although if they did not file a proof of claim to get paid, then I suspect they have not right to pull your reports as they have basically allowed the debt to be discharged - no POC - no money.

Minimal at best, since the BK is going to tank your score no matter what.

As for balances being reported as 0 - if the creditor has not filed a proof of claim, then the debt will be discharged and reporting a zero balance makes sense. If it's a creditor that is getting paid thru the BK, reporting a balance probably isn't a violation.

Thanks for the information LadynRed It's helpful. At least I can go to my attorney and bombard him with questions

[hatmadns]

My First Post so go easy on me

I may be in the wrong thread, I dunno, been on for hours looking for the answer and this one is as close as I have gotten.

I have 2 medical accounts reporting as unpaid collection with EQ yet TU and EX report them as discharged in BK.

I disputed with EQ and I just got thier results today. ^%$#@!!

Says accounts verified and that "Additional information was provided by the original source regarding this item" and that if I still disagree to contact the CA. What the heck could have been provided if it's been discharged since 2003?? uughh!

[LadynRed]

Dispute directly with the CA as directed. Make sure you tell them that the debts were discharged in your 2003 bankruptcy, give them your case number, filing and discharge date and tell them that if they don't report correctly, they will have to answer to a bankruptcy judge.

[cashman]

I filed CH7 in September 2006 and it was discharged in April 2007.

I have since been working on cleaning up my credit reports as good as possible but a few derogatory accounts still remain. Here are some questions I have!

1. Chase Home Mortgage reports lates between September 2007 and April 2007. In April 2007 when the BK was Discharged I reaffirmed the debt and they tell me they can report the lates because I reaffirmed it. Is that correct?

2. Before I filed for BK I had a few rental properties I gave some up in the BK. Two of the Mortgage accounts for these rentals show as foreclosure on some of the credit reports. They were not in foreclosure when I filed for BK. Can they still be reported as in foreclosure? One of the lenders claims that because they filed and got a release of stay they can report the loans as in foreclosure is that correct?

Thanks!

[MrMarshall]

LadyinRed

"NEVER send your BK paperwork to the CRA's.. though some people will sputter and spew that you SHOULD". Ya that's me. I was not informed about DRAKO. But I've always sent the schedule F with the discharge to the credit report agency. And it has worked for me. Maybe the problems that were fixed were not based on my document I sent them. Thanks for all you help.

[dawhitedoves]

No, it is NOT legal. What did you expect them to say ??

The FTC says if the account was not in charge-off status BEFORE you filed for bankrutpcy then they can NOT report it as such AFTER you filed.

Dispute it with the credit bureaus, in wriitng. Then dispute it with the creditor if you have to. If they won't behave, go for the contempt charge in bankruptcy court.

May I please ask you a question?

My lender was showing me late on my first mortgage even though I never re-affirmed the loan, they fixed it and it now shows discharged, $0 due, $0 next payment due just as you described discharged debts should show.

Will this improve my credit score?

Another question.. there was an escrow balance due to lapse of insurance (long story), are escrow balances discharged along with the actual loan?

Unaware of the loan being discharged I applied for a mod but of course was denied, during that time.. chase escrowed my account (they paid for taxes and insurance).. so I am still responsible to paying this new escrow right?

Thank you!

[dawhitedoves]

Another question if I may please.. so I heard about the horror stories of HSBC not reporting the accounts discharged and showing charged off..

I looked in my report and saw that yes it said discharged.. but at the bottom it shows charged off and said "purchased" by another lender, it this entry still OK?

Address:

PO BOX 5253

CAROL STREAM, IL 60197

(800) 477-6000 Account Number:

51XXXX

Address Identification Number:

Status:

Discharged through Bankruptcy Chapter 7.

Date Opened:

08/2007

Date of Status:

06/2009

Reported Since:

09/2007

Last Reported Date:

04/2009

Type:

Credit card

Terms:

N/A

Monthly Payment:

$0

Responsibility:

Individual

Credit Limit:

N/A

High Balance:

$539

Recent Balance:

$0

Recent Payment:

$0

Creditor's Statement:

Purchased by another lender.

[dawhitedoves]

Address:

PO BOX 24696

COLUMBUS, OH 43224

(800) 955-9900 Account Number:

156070631....

Status:

Discharged through Bankruptcy Chapter 7/Never late.

Status Details:

This account is scheduled to continue on record until Mar 2016.

This item was verified and updated on Jun 2011.

Date Opened:

12/2005

Date of Status:

06/2011

Reported Since:

11/2005

Last Reported Date:

05/2011

Type:

Mortgage

Terms:

3 Years

Monthly Payment:

$0

Responsibility:

Individual

Credit Limit:

$211,250

High Balance:

N/A

Recent Balance:

$0

Recent Payment:

$0

Account History:

Debt included in Chapter 7 Bankruptcy on June 15, 2011

The BK was discharged in 2009.. should it not say discharged and then the date of the actual discharge?

it says June 15th because they were showing me late prior to making this correction

Balance History - The following data will appear in the following format:

account balance / date payment received / scheduled payment amount / actual amount paid

Apr 2011: $186,210 / April 11, 2011 / $1,147 / $438

Mar 2011: $186,210 / February 15, 2011 / $1,147 / $761

Feb 2011: $186,466 / February 15, 2011 / $725 / $725

Jan 2011: $186,721 / January 18, 2011 / $725 / $725

Dec 2010: $186,974 / December 7, 2010 / $725 / no data

[bkfreeandclear]

1. BK filed July 2010, discharged October 2010.

2. Did not reaffirm mortgage or car. Now losing home to foreclosure.

3. Have been making car payments on time and current.

Q1. Will the foreclosure report on our credit reports?

Q2. Will lenders only see the BK and how soon purchase home?

Q3. If pay car off, can the bank still repossess or are they obligated to give us title?

Q4. Wondering what our options are for house. We are seeing lawyer to file deferral of sale to buy more time. Wondering how this will play out with the BK. Is deed in lieu or short sale a wise idea and what are the ramifications? What is the best option?

[rebuildr]

I filed for chapter 7 in sept 08 in Florida and was dicharged in Dec. 08. My first was with Countrywide, now BOA and my second was with BOA from the beginning. I've spent the last three years rebuilding my credit and finishing the huge addition that put me so far under to begin with, well that and the decline in value due to the market. Anyway I was pushing close to 700 until a couple of months ago when my mortgage or at least the servicing of it was turned over to Greetree. Greetree bought the discharged mortgage from BOA and the told me in advance so I continued to make payments to them. Well now Greetree is reporting the account. They show it as closed on Sept 1 2011 and as bankruptcy with 0 bal. The problem is that my score dropped right away about 50 points. The negitive reason given by FICO was a recent late payment or derogatory remark. Does Greetree enen have a right to report at all, and if so can they report the account closed as of Sept 2011. My fear is that even if I get them to change or remove the closed date, their recent report of a bankrupt account will affect my score anyway. Your Comments?

[steelman9999]

How long do creditors get to update the "discharged bankruptcy" from Chapter 13?  I got the letter Jan 13, 2013.  There are TL's that still show balances owed and some have even 're-aged" the dates. I've heard that they have 60 days to properly update this to the credit agencies. I live in Ohio.

[Tsandy7]

Lady in Red, I have a question:

 

I filed Chapter 13 in 2008 and it was discharged in December of 2010. The problem I am having is that Ocwen Servicing is not reporting my account to the Credit Bureaus and also they are not sending me my monthly statements for my Mortgage account. I still send in my payments even though they will not send me monthly statements and report to all the Credit Bureaus. I have repeatedly asked why? I get runaround answers that they are working on it. I called Ocwen today and was told bylaw when a person files Bankruptcy they cannot contact that person, however I told Jason this has been since 2010. I have may release papers from the court. Is this a violation and how can I handle this. Any help would be greatly appreciated. They have damaged my credit even more by not reporting at all for 3 year.

thanks

tsandy7

[shellieh98]

Did you reaffirm the debt with them? They are not allowed to contact you through a BK unless the debt is reaffirmed, even though you continue to make the payments.

[Tsandy7]

How do I reaffirm a mortgage, when I had a contract? The mortgage was still being paid the exact amount through the BK. Chapter 13.

My attorney never said anything about having to reaffirm the mortgage. I had some other debt mainly that was on there.  I have my discharged

papers from the court. Am I missing something? I will reaffirm if I should. Thank you for your reply.

[admin]

@Tsandy7 - I think reaffirming is solely for Chapter 7. 

[Tsandy7]

I filed chapter 13 not chapter 7 in which you have to reaffirm. Besides Ocwen was never involved in this until after the chapter 13 was done.

Equity one sold it to Ocwen. Can they legally do this. the last statement I received from Ocwen was July of 2012. after that I never received

anymore statements. What is going on here. I am thoroughly confused. Please advise.

thanks.

tsandy7

[despritfreya]

Tsandy7,

 

There are a few things you need to recognize. . .

 

1. There is no law that requires a creditor to report anything to the CRA. The law only requires that if a creditor reports, it reports accurate information.

 

2. You are correct that you would not reaffirm in the context of a Chapter 13. However, your lender and/or its assignee was involved in that case and it is perfectly legal for any creditor to transfer either the entire loan or its servicing to some other entity - in your case, Ocwen.

 

3. If your Chapter 13 Plan and the Order approving the Plan specifically stated that you would continue to make payments on the loan, the loan was most likely not "discharged". See 11 USC 1328(a)(1) which refers you back to 1322((5) which in turn, discusses long term debt provided for under the Plan - although the language of 1322((5) could possibly be interpreted as only applying to loans where there was a pre petition default.

 

4. Despite the language of 1328, I have yet to find a mortgage lender who understands that the obligation most likely is not discharged if a debtor is going to maintain payments. Further, some lenders do not understand that, even if the debt was discharged, it is not a violation of the discharge injunction to send monthly billing statements. The ones that do understand this send the statements and include a boiler plate provision that they are not attempting to collect but are sending the statement for informational purposes.

 

If you want billing statements my recommendation is to send a letter, via Certified Mail, Return Receipt Requested, asking that the statements be sent and that you will not consider such action as a violation of your bk rights. I do not believe there is anything you can do if Ocwen declines the request. I do assume, however, that the lender has been sending you the proper tax form for the interest paid on the loan so that you can take the mortgage interest deduction. If not, then I would agree there is a problem.

 

Best of luck in dealing with this issue.

 

Des.

 

[girlfromga]

I filed bankruptcy Chapter 13 in Nov 2013 before that date I was never late on any bill was not past due or behind. I check my report in April 14 and it is showing 4 past due balances. Two are being paid with my payment to the trustee two and not getting any money but are still in the case. Can they show me as being past due it would seem like I'll never get a better score if they show me late for the 3 years.. I thought if I filed before anything was late it would look better when I am done It would show I could handle credit. Due to an illness and the lose of 1 income we could no longer keep up the payment that is why we filed.