reporting agencies listing as bankruptcy and charge off

What is the name of your state? florida.

i filed chapter 13 in jan 1999, then changed it to a 7 in jan, 2000. i looked at my credit on 2 of 3 credit reporting agencies. one was not bad the other has every thing as account charge off . i challenged several and they are investigating them but the one to key bank verified discharged through bankruptcy/charged off. can they list as bankruptcy and charge off and if not what do i need to do to get them to change it
thank you

[Ladynred]

I believe I read somewhere in another forum that they can leave the charge-off notation as long as the LAST entry is 'included in bankrutpcy' (or something similar) and the balance is ZERO.

[bigun]

Here's the opinion letter.

UNITED STATES OF AMERICA
FEDERAL TRADE COMMISSION
WASHINGTON, D.C. 20580

Division of Credit Practices
Bureau of Consumer Protection
~
Clarke W. Brinckerhoff
Attorney
~
(202) 326-3224


April 24, 1998

Mr. Michael Lovern, Sr.
President
TRIAL MANAGEMENT ASSOCIATES, INC.
8972 Quioccasin Road - Suite 172
Richmond, Virginia 23229

Dear Mr. Lovern:

David Medine 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(b) 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,

Clarke W. Brinckerhoff

cc:
David Medine
Jay Shaffer

thank you for the letter and the info. would it be advisable to send a letter to the fed trade comm or send a copy to experian who is listing both cars. one as repossessed and the other as bankruptcy/charge off (key bank has verified and it was left on my credit report as so). premier has not responded yet about the reposession. thank you

[bigun]

Was it chargedoff when you file bk?

no everything was close to 3 months behind but nothing was repoed prior to filing chapter 13 which i paid on for a year. after key repoed, after i converted to a 7, they sold car at auction then kept sending me a bill for what was left owed on the car. lawyer finally put a stop to that.

[bigun]

I think I'd try the dispute again telling the CRA that the account was not chargedoff prior to filing bk and see where it goes. If they still verify, you may demand that they provide the procedure used to verify.
I'd also inform Key Bamk that they are reporting incorrectly. Here is a snippet from another opinion letter.

(b) prohibits a creditor from reporting to a CRA that an account which has been discharged in bankruptcy has also been charged off so long as the credit grantor has in fact charged off the account


Division of Financial Practices
~
Clarke W. Brinckerhoff
Attorney
-
202-326-3224
UNITED STATES OF AMERICA
FEDERAL TRADE COMMISSION
WASHINGTON, D.C. 20580


June 3, 1999

Peter L. McCorkell, Esq.
Senior Vice President and General Counsel
Fair, Isaac and Company Inc.
120 North Redwood Drive
San Rafael, California 94903

Dear Mr. McCorkell:

This responds to your letter concerning the application of the Fair Credit Reporting Act ("FCRA") to an account that is reported to a consumer reporting agency ("CRA") by a creditor, when the account is discharged in bankruptcy and charged off by the creditor, either before or after the discharge. You note that a staff opinion letter (Lovern, 4/24/98) stated that a credit bureau would violate Section 607(b) of the FCRA if it reported a discharged item as a chargeoff when it was in fact not charged off. You state that (contrary to a comment attributed by Mr. Lovern to a Fair Isaac source in his letter to us) your risk scores assign the same number of points to a bankrupt tradeline regardless of whether that account is also reported as charged off.

Specifically, you ask if we concur in your view that "nothing in the FCRA (a) prohibits a creditor from 'charging off' an account, whether before or after the filing of a bankruptcy; (b) prohibits a creditor from reporting to a CRA that an account which has been discharged in bankruptcy has also been charged off so long as the credit grantor has in fact charged off the account; or (c) or prohibits a CRA from reporting an account which has been discharged in bankruptcy as also having been charged off if the creditor has so reported the account to the CRA and the CRA has no reason to believe otherwise." We agree that the FCRA prohibits none of those practices in the circumstances you describe.

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

Sincerely yours,

Clarke W. Brinckerhoff

I'd say if they didn't charge it off prior to bk, they can't list it as a chargeoff post bk. ALl they should be able to list is account included in bk and a 0 balance .

i just looked at my report. they have changed most but Chase has theirs listed as discharged thru bk 13/ collections account and in the notes area it says purchased by another lender. have sent letter to experian and asked them to verify that they can list the account this way and if they can sell account while included in bk. credit looks better already should have ask questions 2 yrs ago thank you very much for all the help. i still have to correct equifax but i'll get there. thank you again

[bigun]

Purchased by another lender? Is the other lender marking up your credit report? Even with an inquiry? If so, somebody owes you money. This violates not only the bk code but, the FDCPA as well.

it doesn't list the lender so i don't know who it is . for a yr the only on checking credit was orchard bank and they did it almost monthly from 9/01 till 9/02 they skipped 3, 4, and 5/02 then quit 9/02. the other corrected statement is 798.00 owed as of 6/03. this is after they verified.

[bigun]

It is an FCRA violation for your discharged creditors to check your credit report. They have no permissible purpose.
Send them a letter demanding $1000 for the non pp. If they don't come across, sue them im small claims court. The FTC site is down but, the pp section is pretty clear. If you didn't apply for credit or employment, that no business looking at your report.

just had conversation with creditors exchange who checked my credit in july/02 stated they checked for key bank. stated that key bank did not know that i had included them in bk. when i told him that was a violation he stated to call my attorney for the bk then and hung up. so can i send letter to key bk as well as chase. and will they really pay? thank you again

[bigun]

They'll pay when you sue them. Read section 604 of the FCRA.

[url]http://www.ftc.gov/os/statutes/fcra.htm#604[/url]

Post this at [url]www.creditboards.com[/url] and you'll find a number of people have sued and won over non pp. PP is the only thing in the either the FCRA or, the FDCPA that calls for a mandatory $1000 for the violation. It is a stautory offense and makes no provision for the bonifide error defense.
If Key Bank is on your bk matrix, they have no defense.

Who is creditors exchange? Is this a collection agency?

yeah they said they were authorized by key bank to collect the outstanding after the car (that was included in bk) was sold at auction. they said they found out when they checked my credit that it was included.

[bigun]

Depends on how much of a PIA you wish to become. [url]www.creditboards.com[/url] has a lot of sample nonpp letters as well as some people who've successfully sued creditors for nonpp. At the very least, you should insist that the collection agency remove their footprint from your report {including any inquiry}.