kdunnk

Weird Old CC Chargeoff with OC - Help

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Hi all,

I've relied on this site for the last 2 years when I first found numerous errors.  I thank you for the solid advice I have found here, which has empowered me to clean up everything but this last item. This chargeoff is a little unique so I am not sure how other chargeoff posts relate to it.  It is probably a valid account though I question the amount. It will fall off my report in July 2018, but I would want to pay what I owe legitimately, as a matter of personal integrity unless it exposes me to new illegitimate credit issues.

Background: In 2008 I bought a MINI Cooper and with it came a visa card with a $1000 limit. I used this card responsibly with  no late payments until it was stolen and replaced in February 2011. I managed the account using the paperless online portal. In February 2011 I also paid off my MINI a month early with a perfect payment record. In April 2011 I was diagnosed with a rare breast cancer and left my job. In June 2011 I moved to a nearby city to be closer to my doctors and treatment. This next part I don't recall but have reason to believe may be vaild: My credit file shows I have a 30 day late payment on the replacement card in May 2011 and a last payment July 3, 2011. Then in October 2011 it shows 30 days late and closed, with a chargeoff in February 2012 for a balance of $1196. The comment on my TU report says "Maximum delinquency of 120 days in 01/2012 for $337 and in 02/2012"

In July 2012 I was cancer-free and working again. In January 2016 I pulled my credit report and found records for the card stolen in 2/11 showing a perfect payment record and "current closed when stolen" status as well as the entry for the replacement card. At the time I believed it was a mistake and disputed it with the credit reporting bureaus because I thought I had permanently closed the card when it was stolen the same month i paid off the car. However, I just found a payment receipt I printed in July 2011, with a handwritten note that suggests i was locked out of the portal that same month with an 800#, name and "$0 bal".  This leads me to believe it is a valid acct and credit item that I lost track of during the move and health scare. I think the $337 sounds a little high for what I normally charged, but more possible than $1,196. I know there was a high balance over my limit when I purchased items for work, and my boss paid my bill with an account his wife was closing at the same time in early January, but it was fully resolved in the same month and no payments were actually missed. That high balance should be $1235, not $2579 though. 

Since I initially thought this was invalid and would be easily handled by CRB investigation, I addressed other collections first, which were all bogus and have since been removed. This chargeoff is with the original creditor, never having been sold, since the bureaus validated it with them. Is it possible for me to get the statements from them now before I try to settle or pay? If I pay will I re-age the account? If the amount was only $337, could the additional $860 on the chargeoff be fees or interest? That seems strangely high. I also know I would have paid the bill if I had known about it and I never got any letter about chargeoff or late payment - I definitely would have responded to it for fear it could affect my employment chances and ability to get doctors to work with me given the rarity and lack of protocol for the kind of cancer I was battling. Any advice is welcome.

I added both screencaps for the account including the one closed in February 2011 and the one that replaced that card.

BMW1.png

BMW2.png

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20 minutes ago, kdunnk said:

If the amount was only $337, could the additional $860 on the chargeoff be fees or interest?

Easily. In fact you got off very light if you figure 29% interest over 6 years. They must have stopped charging you interest after 3 years. 

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@Harry Seaward Can they charge interest after they closed the account on 10/2011 (weird since thats the initial 30 days late)? I'm sure once they file the chargeoff on 3/2012 they can't keep charging interest... even if so, we weren't talking 3 - 6 years but 6 months top, and the balance of $337 on 2/12 skyrocketing to $1192 on 3/12 is 354% increase over a 30 day span.

Regardless, is my best bet to request the past statements from the OC? Should I try to settle and reduce the interest or fees added? If so will that re-age the account and/or open me up to collection agency hell?

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3 hours ago, kdunnk said:

Can they charge interest after they closed the account on 10/2011 (weird since thats the initial 30 days late)? I'm sure once they file the chargeoff on 3/2012 they can't keep charging interest

They can unless there is something in your agreement that says they can't. Charge-off just lets them claim the debt as a loss on their books. The debt is still owed and there is nothing about charge-off status per se that keeps them from charging interest. 

3 hours ago, kdunnk said:

the balance of $337 on 2/12 skyrocketing to $1192 on 3/12 is 354% increase over a 30 day span

Where are you coming up with $1192 on 3/12?

3 hours ago, kdunnk said:

Regardless, is my best bet to request the past statements from the OC? Should I try to settle and reduce the interest or fees added? If so will that re-age the account and/or open me up to collection agency hell?

This debt is beyond the California statute of limitations - they can still try to collect it, but cannot sue.

If you were to come to settlement terms with a lump sum payment,  and held up your end, the SOL clock cannot be restarted. If you agree to monthly payments and then default, the SOL clock may restart in that case. 

Unless you have a need to clear this item from your credit reports right now, I wouldn't do a thing. It will fall off your reports in 8 months and that will be the end of it. If you do decide to negotiate a settlement, you want the account DELETED from your reports in exchange for payment. Having something this old simply update as "paid" will do you no good, and will probably lower your credit score. The saying "time heals all wounds" applies to credit reports. The longer a derogatory account is dormant, the less impact it has.  Paying the account doesn't remove its derogatory status, but does trigger an update by the creditor, so it will be like reopening an old wound.

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Thank you so much for the insight! I'll take your advice and let it age off then - pretty sure it will fall off on its own with no effort on my part before I could fully investigate and get halfway through the dispute/resolution process if is a mistake or fraud at this point.

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On 11/17/2017 at 10:13 PM, Harry Seaward said:
Where are you coming up with $1192 on 3/12?

Oh, I reasoned from the chargeoff status of 3/12 - 2/13 and the "original chargeoff" amount being listed as $1196.  Unless original chargeoff doesnt mean the amount written off on the original chargeofff status date? I would still think that "date updated" indicating 2/13 would be the latest date for a balance of $1196 which is just 13 months after the 2/12 $337 balance. Or am I just completely backwards here? I know I had a stellar credit rating when I bought my MINI, and secured the lowest possible interest rate (<3%) with great terms on my car loan.  I seriously doubt the APR was over 15%.

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13 hours ago, kdunnk said:

I seriously doubt the APR was over 15%.

Your normal rate may have been this low, but somewhere in your agreement it states the "default" rate which is the rate you pay when you default on the agreement. Default rates are usually just under 30%.

I'm seeing the "last update" as 2/13. Even at 30%, $335 wouldn't turn into $1,196 in a year, but is right on par with a few $35 late fees and 3 years worth of interest. I'm thinking either there were some additional fees tacked on or they updated the balance at some later point and the credit report doesn't show the "updated" date. 

It's certainly possible that the accounting is wrong and / or they mixed up details from the two different accounts. If you had all of the paper on this account, that's one thing.  But when there are gaps in the data, I just usually start with the assumption that the reported info is correct and then work backwards to see if the possible/common variables fit logically. In your case there are logical discrepancies with the reported info and the only way to reconcile it would be to go back to the creditor and ask for a full accounting of the balance owed. Given the timeline remaining, I wouldn't bother. 

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