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Company reporting negative after time limit!!! Any suggestions?


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Hi everyone!

We are currently refinancing our home and everything was going smooth with the original credit pulled and then the bank decided to pull credit one last time before the refinance closed and BAM! A creditor had, within this month, reported a negative from 1997 on there which dropped our scores and messed everything up.

Back in 10/1997 my husband purchased a piece of jewelry at Crown Diamonds on credit. The very next day he decided to return the item to the store. They kept his deposit and cancelled the transaction (like a normal return.. so he thought). - Don't say it... I know... he turned a blind eye to that one.

Well, for the past 9 years they have not reported a thing... we never even thought twice about it. All of a sudden the other day.. there it appears on our credit while we are in the process of the refinance as a voluntary repossession.

Now, in doing some searching it seems that in California the law is 7 years it can be reported. And at this moment we are only a few days away from this being a 9 year old transaction.

I contacted the company but they just say they will send the info. up higher and hopefully someone will call back and some crud about disputing it thru the credit bureau.

I don't want to dispute it which takes a month... I need it off now! We are locked in the middle of this refi. and I'm hoping someone may know a little law or have some information that will help lead me in the quickest way to get this corrected.

Grrrr... so frustrating! Any information would be greatly appreciated.

Thanks everyone for your time! :)


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If you have proof of the date, take that with a letter of explination to your mortgage broker and have them do a rapid rescore.

I will tell you this, once it is done, sue the pants off Crown. Even in 1997 a returned piece of jewelry is still returned. I don't know where they got this "voluntary repossession" crap from...that's totally bogus. Every State I know of has consumer laws allowing a contract to be recinded by the borrower within a set time frame (usually a few days).

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Methuss - Thank you for your quick response.

It is bogus what they are doing. Unfortunately, 2 months ago I destroyed all records for those long past years. I never in a million years thought I'd need them at this point! Especially, when none of this was ever reported on our credit and my husband had thought he "returned" the jewelry and was never aware that it was considered a voluntary repossession the very day after purchase.

I live in California and from what I've found so far the law says 3 day period to cancel a contract. The exception I guess is if it's posted in plain site that there is no cancellation allowed. The problem with all that is this happened back in 1997... how in the world could I prove a sign wasn't there this late in the game? lol... talk about a ridiculous situation. My husband has always been under the impression it was a return.. not a voluntary repossession and I would figure he would have been aware if their policy was clearly posted so I would have to assume it wasn't.

I'm going to call a credit attorney in a little bit and see what they say and what rights I may have since Crown Diamonds does not want to seem to care about helping me with this situation. I know they are wrong... I even think they know they are wrong... but they don't want to bother with a correction or letter.. they seem to want us to dispute it and have it taken off by the credit agencies = problem being that is 30 days away... and our refinance is now! They just seem too lazy and unhelpful to work with us to get this corrected. Pretty sad!

Maybe an Attorney can help or offer a little backup to get this resolved in a timely manner. It seems a little "pressure" is needed to get things made right.

All I can say is Buyer Beware at Crown Diamonds.

Thanks for your response! I'll post more as I get this settled. Maybe it will help someone else later on.

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How is it reporting? What exactly does the TL say?

Remember that if you are borrowing more than $150,000 the 7 year limit does not apply.

If the TL is being misreported (reaged), send a certified letter to the jeweler and tell them that you will be suing them for actual damages equal to the amount of the refi loan.

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Marvelous Methuss mentioned the magic phrase...Rapid Rescore. Right now, find out if your Mortgage Broker can hook you up with this. It's costly, but fast and will allow you to obtain your loan.

The tickle: You need some form of documentation from the OC/creditor/DF. Keep your cool and your heads. Work the creditor to get what you need. Then make decisions about whether to sue. Sometimes you have to be sly to accomplish your goals. Be very focused right now. You can always take action later.

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what is your bank doing pulling a new report in the middle of a refi while you are locked anyhow? Not that that's totally the problem here but if a lender needs to update a tradeline they usually order a credit supplement but if the report the lender is using is old (like 90 days) then they may have needed to repull... just a tad confused.

My best advice would go along with Methuss... I would call the OC get the details about the TL (like the DOLA) and then supply that to the banker for the rapid rescore since the account is now obsolete.

Then once you've closed sue the OC (or CA) since you will more than likely have some actual damages if you can prove that this was not simply an 'error'.

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AaronE - There are a few scanarios in which mortgage companies can re-pull credit; they try not to if possible, but it happens a lot when necessary. Not saying that any of these apply to fxbyjanice's situation, but a few reasons are:

If I get a mortgage though ABC Home Loans, they may turn around and try to sell the loan to XYZ Home Funding, either getting pre-approval before closing the loan, or shortly afterwards without approval. XYZ can then run the credit again, since they are now considering assuming the risk of the loan. Sometimes they will go with th report supplied by ABC, sometimes they will run a new one...

or if a certain amount of time passes between initial application and closing...

or if more than a certain amount of days (30-60 or more) passes between loan closing with ABC, and then ABC tries to sell it somewhere else. The lapse of time, though it could be caused by several issues, now makes it appear that ABC tried to sell it to other companies, who looked at it, then declined it... [Wouldn't apply to fxbyjanice]

or if there's something else in the loan file that indicates there should be more tradelines (like my application stating I'm paying off my depatment store card, but there's no card on the credit report)...

or if the file indicates the borrower seems to own more than one property not disclosed on the application...

or if there's no credit supplement correcting tradelines that either the borrower or the broker or originator are stating are in error, and no other documentation was included...

or the loan may just be selected for a complete underwriting audit, since a certain percentage are at all companies.

The first and last reasons are the most common. Most of the time the borrower will never even realize this until they receive a letter long after their loan has closed stating that the loan has been transferred to another ccompany, then maybe transferred again a few weeks later.

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