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If SOL on Credit Report ends B 4 last payment is due, is written verification needed?


confuseddebtor
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I may soon begin making monthly payments on a settlement offer to a collection agency(I have received agreement in writing).

The first date of delinquency with original creditor was in 2002, which means it will be removed from my credit report in 2009 due to SOL. Here is my question:

Since I will be making monthly payments longer than two years, is it necessary to have the collection office provide a letter stating they will remove it from my report after it's paid in full, since the SOL will come first anyway? The letter I received does state, the credit bureaus will note that I'm making payments, and that after my last payment "I will not owe anything further on the debt"

Thanks

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You're confusing some terms here...

SOL is a state law that usually says, if you're sued for a debt whose date of first delinquency was beyond some time period, you have an affirmative defense against it.

The "seven year rule" is "reporting period" (a federal law) which determines how long something can stay on your credit reports, and, in general applies only to derogatory accounts. If you voluntarily agree to repay an already charged off account, it MAY (repeat MAY) reset the reporting period. (Technically, it shouldn't because it should be measured from the date of first delinquency on the original account...but...you may have to go to court to get it enforced.)

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If you voluntarily agree to repay an already charged off account, it MAY (repeat MAY) reset the reporting period. (Technically, it shouldn't because it should be measured from the date of first delinquency on the original account...but...you may have to go to court to get it enforced.)

Yes I meant the "reporting period", but always say SOL. Sorry about that. Thanks for this reply. If you ever come across an actual law concerning this online, would you mind posting for me? I've checked two of the credit bureau sites, and I'm surprised they don't have a question and answer section with clear cut answers. I'll check the third credit bureau later tonight, maybe it will have more details. Come to think of it...maybe it's because I've been searching for "statute of limitations" instead of "reporting period". Let me try that. :)

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Begin with the FCRA link (at the top of the page) for a the reporting period rule...it says, in part.

c) Running of reporting period.

(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.

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Begin with the FCRA link (at the top of the page) for a the reporting period rule...it says, in part.

Ok, does this mean it's not important that the collector put in the letter they will remove the account from my credit report after it has been paid, since it will automatically be deleted from the 1st delinquency date(which comes before my last payment)? Or does the 1st delinquency date not apply to the collection office? I'm still not sure of the answer. It's a little tricky.

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Honestly, I'm not sure either. If the OC is reporting, then yes their TL should be removed at 7 years. I'm not sure about the JDB...

As I understand the situation, you signed a NEW written contract to pay an old debt...correct? If so, then it may be the new contract the defines how long this debt will appear on your CRs. In effect, you've taken on an entirely new debt with a new creditor.

You may want to talk the whole thing over with a consumer lawyer in your area. I'm not at all sure that the new debt is legal (probably is, but I'd still check) and if you're going to obligate yourself for 12 years, you need to make sure its worth doing.

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Honestly, I'm not sure either. If the OC is reporting, then yes their TL should be removed at 7 years. I'm not sure about the JDB...

As I understand the situation, you signed a NEW written contract to pay an old debt...correct? If so, then it may be the new contract the defines how long this debt will appear on your CRs. In effect, you've taken on an entirely new debt with a new creditor.

You may want to talk the whole thing over with a consumer lawyer in your area. I'm not at all sure that the new debt is legal (probably is, but I'd still check) and if you're going to obligate yourself for 12 years, you need to make sure its worth doing.

Oh boy! This is all so confusing. I am DONE with credit!!! I would love to speak with a consumer lawyer, but I probably can't afford to. I refinanced in 2002...at least I think "refinanced" is the correct term. And supposedly the SOL on that is 10 years. I'll make some calls tomorrow. My first payment is due in a month, so I better get some answers fast.

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Try legal aid in your area. You might at least get a free consultation.

Good luck, and keep us informed. We'll try to help if we can...

I have called a few in my area. Unfortunately, I was told that unless I have assets, and I'm working, they can't help me since I'm collection(or is it judgment) proof. Supposedly, they have to reserve their services for the low income who are in danger of being garnished, or losing homes, cars, ect. But I'll keep looking. You never know. Thanks for all your help.

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You're confusing some terms here...

SOL is a state law that usually says, if you're sued for a debt whose date of first delinquency was beyond some time period, you have an affirmative defense against it.

The "seven year rule" is "reporting period" (a federal law) which determines how long something can stay on your credit reports, and, in general applies only to derogatory accounts. If you voluntarily agree to repay an already charged off account, it MAY (repeat MAY) reset the reporting period. (Technically, it shouldn't because it should be measured from the date of first delinquency on the original account...but...you may have to go to court to get it enforced.)

~

Ok, I have always wondered. Is the first delinquency the first time it was ever late? Or the first, last payment you ever made?

For example if I was late for several months in 2000 and then made more payments and then in 2001 stopped paying, in say, July then they charged it off in October. Would the first delinquency for the SOL be 2000, or July of 2001?

Thanks!

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Try legal aid in your area. You might at least get a free consultation.

Good luck, and keep us informed. We'll try to help if we can...

Willingtocope, you are patient to a fault. You're helping lots of folks here.

Another place to check for legal assistance is with your state bar association's pro bono program. Just google "[name of your state] + bar association". However, some free or reduced price legal assistance programs won't help with collection cases. Worth a try, though.

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I can't quote the law verbatium, but it says something to the effect that the "date of first delinquency" is the date on which you were delinquent and never brought current. The consensus is, this means one billing cycle AFTER your last "on time" payment that brought you up to date..

I received a current copy of my credit report and called equifax. I was also told the 7 year reporting period starts on the credit report, from the 1st delinuent date. So any activity or payment on the account doesn't change that. But it does restart the clock to be sued for the debt.

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I received a current copy of my credit report and called equifax. I was also told the 7 year reporting period starts on the credit report, from the 1st delinuent date. So any activity or payment on the account doesn't change that. But it does restart the clock to be sued for the debt.

Essentially correct...but...as far as restart the clock to be sued, it actually depends on the laws of the state your in. The reporting period is a federal law...the SOL for suits is a state by state thing.

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As was come across earlier today once you make 3 consecutive payments under the workout agreement the account may be "re-aged" by the original creditor. That means the account can be reported as an active tradeline again and it stays on your report, legally, until 7 years after you complete the workout agreement.

This is a definition of re-aging: "returning a delinquent, open-end account to current status without collecting the total amount of principal, interest, and fees that are contractually due."

The original creditor does not have to do this, but they are allowed to.

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Essentially correct...but...as far as restart the clock to be sued, it actually depends on the laws of the state your in. The reporting period is a federal law...the SOL for suits is a state by state thing.

Yep, depends on the state and type of debt(credit card, loan, promissary note, ect).

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As was come across earlier today once you make 3 consecutive payments under the workout agreement the account may be "re-aged" by the original creditor. That means the account can be reported as an active tradeline again and it stays on your report, legally, until 7 years after you complete the workout agreement.

This is a definition of re-aging: "returning a delinquent, open-end account to current status without collecting the total amount of principal, interest, and fees that are contractually due."

The original creditor does not have to do this, but they are allowed to.

The account I've made arrangements on is not an open-end account. It's a loan, that was sold to the collector, so fortunately, my situation is a little different. On a different note, a collector tried to re-age accounts belonging to my brother in law two years ago, and my room mate in 2000, along with adding the extra 7 years. So I know for a fact collectors may try this, but they aren't legally allowed and it won't stand up in court. Both agencies were fined, and lost in court. I'll ask them about original creditors tomorrow. I think an OC tried this with my brother in law also, but I didn't follow up on it. He won a lump sum of money, so they got greedy I suppose. Wonder what happened?

Can a Collection Agency Re-Age My Debts?

Legally, no. Re-aging debts is the process by which a collection agency reports the debt as becoming delinquent on the date it was referred to the collection agency in an effort to extend the time during which the debt can be reported on a consumer’s credit report. This practice violates not only the Fair Debt Collection Practices Act (FDCPA), but also the Fair Credit Reporting Act (FCRA).

The FCRA states that a debt can be reported for 7 years from the date of the original delinquency. Altering the date of the original delinquency violates the portion of the FCRA which states that a furnisher of information must report the first date of delinquency, or be subject to fines in the amount of $2,500 per violation. This also violates the FDCPA’s prohibition against making false or misleading representations in connection with the collection of a debt.

So What Do You Do If Your Debt is Re-Aged?

If you see a re-aged account appear on your credit report, the worst thing you can do is make an arrangement to pay it as that can start the clock running again – both on how long the debt can be reported, and on whether or not you can be sued on the debt.

Your first step is to write to the credit bureau to dispute the tradeline and request that it be deleted from your report. You’ll need to provide specific information about why the debt shouldn’t be reported, including the original creditor and the original date of delinquency. If you have any supporting documentation which shows the original date of delinquency, you should forward that to the credit bureau as well.

At the same time, you should notify the collection agency, in writing, that the debt is disputed and request that the collection agency provide you with the underlying documentation which supports the debt, and which shows the original date of delinquency. If you can’t get the credit bureau to delete the item from your report, then you may need to contact your state’s Attorney General’s Office and/or the Better Business Bureau for assistance. You may also want to consider consulting an attorney to determine whether you have grounds to sue the collection agency for its violation of federal laws.

http://credit.about.com/od/fastfactsfaqs/f/reaging.htm

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