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  1. #1
    Registered User New Member

    question on charge offs and time limits

    Hi everyone. I just started visiting the site a few days ago and have been browsing through many of the posts and articles. This is a great and very informative site. Thanks to all who have contributed.

    Here's my question:

    I have four CC accounts that were charged off in late 98 and early 99. However, these were cards I acquired in college in 92 and 93, and which became delinquent in 95. In 1996 I entered a credit counseling service (big mistake!!) and paid into that for a year. After a year I realized that the service had been holding my payments to them for a month and then sending out payment to the CCs, thereby incurring late and over limit fees each month, and increasing the amount of money owed (by about 2K). In 97 I stopped the service. From 97 to 98 I made "some" payments on the CCs, but never enough to cure the delinquencies. (I'd send a min payment here and $100 there, but never anything substantial or consistent). In 98 and 99, the CCs charged off the debts. (The total debt is about 5K.)

    After reading the FCRA and the FTC opinion letters, I am wondering how long these charge offs should be reported on my credit report. Under the 96 amendment to 605, the charge offs can be reported for 7 years, starting 180 days after the initial delinquency. But this only applies to items reported after 12/97. For items placed prior to that, it is 7 years from the date the item is reported.

    Based on this, since my charge offs were reported in 98 and 99, I think they fall under the new rule (7yrs +180days from initial delinquency). If thats the case, then shouldn't they come off 7yrs+180days after the initial delinquencies in 95? But Experian has them coming off 7 years after the charge off dates in 98 and 99 (roughly in 05 and 06).

    Should I dispute this with the CRAs? Or should I get validation from the CA/OCs first?

    Also, I am a licensed attorney, and would not think twice about filing a suit in my own name against any of the CRAs in small claims court, or even circuit or fed court for that matter, for FCRA violations. (I'm thinking of disputing the items as obsolete, requesting verification from the CA/OCs, and then challenging any of the items that aren't removed.)

    One problem though, is that I don't have any of the records from way back in 95 and such (because I was a dumb college student instead of just a dumb lawyer). Thus, I don't have any evidence of when the accounts initially went into delinquency. However, if I filed suit and named the CA/OCs, I could use the discovery process to get full records for all the accounts. Would that be a good idea as well? (Assuming I couldn't get the deletions prior to trial via settlement.)

    I've paid more than enough to these creditors during the 90s to more than make up for any actual purchases plus interest equal to 2 times the principle. I don't think they deserve anymore. Nor do I think I should have to wait another 3 years for my credit to be clean.

    Any answers or adivce would be greatly appreciated. Thanks again for a great site.

  2. question on charge offs and time limits
  3. #2
    The high desert
    I wouldn't worry about not having the records, they're the ones who have to prove that they are right. If you actually sue, you can of course request the statements.

    Or, you could buy them anytime for a few bucks a statement. However, it's really NOT necessary.

    As you planned, request validation for all collections, then dispute with the bureaus as "re-aged and disputed."

    Dispute all the original creditor old derogs that were re-aged as: "re-aged, the account first became delinquent in 95."

    If any of these accounts are then VERIFIED, you can consider suing.

    It's really important that you do NOT dispute as "not my account" as the CRAs will then verifiy that it IS your account, which is of course true, and you don't have any violations.

  4. #3
    Registered User Senior Member
    Alhambra, CA

    I had the exact same situation

    I had student loans from Citibank. I was young, maybe 20 years old and I couldn't always make the payments like I wanted to. When I was working, I'd make payments - sometimes even double payments trying to catch up.

    Eventually they were defaulted and went to California as the guaranteeing agency. They had someone contact me and, at the time, I was flush. I cut them a check for the full amount and considered the matter settled.

    A few years later, I decided to get some credit and low and behold I had three paid collections on my credit profile. I disputed them and they came back verified.

    After some research into the FCRA I requested and got my payment history out of Citibank and managed to prove that more than seven years had passed from the FIRST date of delinquency. Realize, of course, that the first date of delinquency was back in 1992 - long before the 1996 amendment for the FCRA.

    The credit repositories accepted that and deleted the items. A happy ending.

  5. #4
    Registered User New Member
    Thanks for the info everybody!

    Heres another question. For the most part, my debts are still listed with the OC and not a CA. (3 are with OC and 1 with CA). What duty does the OC have to verify the debt to me? Since the FDCPA doesn't apply to OC's, then the validation/verification sections don't apply to the OC. Is there some other law somewhere requiring an OC to verify the debt to the debtor? Seeing as the OCs are excuded under the FDCPA, it looks like anybody could just say "X owes me money" and not have to do anything about it when its disputed aside from tell the CRAs that "X owes me money."

    I guess what I'm saying is, asking an OC to validate makes no sense because they are exempt. Likewise, requesting verification is probably useless as well, since they have no duty to verify with me.

    Thus, I'm thinking that all I can do is dispute the items with the CRAs and wait for them to verify. In the case they verify, then I can sue them for FCRA violations. And then through discovery I can subpoena the records of the OCs. (Assuming no settlements are forthcoming.)

    Or is there some other way I can get my payment records from the OCs?

    Thanks again guys!

  6. #5
    The high desert
    All the original creditor has to do is send a statement. Sometimes they go beyond that and provide a bunch of statements, copies of checks you sent in, etc.

    It's very important that the FCRA doesn't allow for harrassment disputes with creditors.

    That translates to disputing what's WRONG.

    If you think it's not your account, you can let them know. If you get the final statement and it's not your account, you can say so, and you probably have to sign a fraud affidavit. Obviously, you don't want to do this if it IS your account.

    But, sometimes a creditor doesn't send anything and then you have a violation. Of course, if it IS your account, what do you think a judge will say about the subsequent violation?

    I like asking them to substantiate the balance, especially if it's higher than the final statement. What to do really depends on WHO you're dealing with.

    I prefer to find actual reporting violations, and often that's not hard to do.

  7. #6
    Registered User Junior Member
    Columbus, Ohio
    Hey Lawguy,

    We're delighted to have you, an atty., on board. As an Atty. you know something about Prima Facie Evidence. A bill (Presentment) from an OC is considered FACT until you rebutt that claim.

    Therefore, YES - an OC can send anyone a bill for any amount, fraud notwithstanding. (and some of them do it all the time, like the IRS). This acts as Prima Facie Evidence until you dispute it, whenever that may be. This is why, on a collection notice, (A Dunning Notice) you'll see the following;


    What it does NOT say is that "THE DEBT BECOMES VALID".

    So one argument, even with an oc, is basically that: "You sent me an incorrect bill!!! Either send me a correct bill or provide PROOF that the bill you've sent is in fact correct". Since you DON'T want a correct bill, (in fact no matter what they send you will be incorrect) jump right to the second of these components. Demand that they prove the bill they've already sent is correct.

    In so doing you're entitled to see the transaction history for the account because they do have to provide you with proof that the bill is accurate.

    Which brings us to point #2:

    People become confused quite often as to who their battle is against. OC's and CA's often purposely confuse this issue, but it's really (usually) quite simple. Your battle is ALWAYS with the DF, (data furnisher). A DF is ANYONE who registers tradelines with the CRA's, as in your case they just happen to be OC's. Although OC's are not subject to FDCPA (in most instances) the law with which you can defeat your adversary becomes the FCRA.

    The new revisions of the FCRA, (CRRR of 97) levied an entirely new list of responsibilites for any DF to investigate your claim. Their investigation responsibilites go WAY BEYOND just a cursory glance at their exisitng computer screen, they must dig fairly deeply.

    So Christine is right on when she says they have to send you a statement. But you are entitled to a complete statement.

    Once you receive this, the fact that you originally became delinquent long ago with be revealed. Just don't tell them that you have no records, pretend that you do so that you can subtly insinuate that their records damn well better match yours.


    So lets take a look at the UCC for your state with respect to the establishment of Prima Facie Evidence, your rebuttel rights and the FCRA. Therein lies your answers.

    I try to talk things through conceptually, so I hope this helps.

    Good luck and keep us posted.

    Again, welcome aboard.


  8. #7
    The high desert
    Butch, I don't follow this. According to the FCBA we have 60 days to dispute charges, IF they're fraudulent and a bunch of other conditions apply.

    My dad just found out that he was charged for a $500+ futon TWICE. He only got one futon. The store is now EMPTY, out of biz. But, it's after the 60 days, and the bank refuses to do ANYTHING since the 60 days are up.

    This is a little off topic, but if there's a way to make a creditor PROVE a LEGITIMATE charge-off, what can my dad do about a truly fraudulent charge in 2002?

    Does he have to default? I don't even know if he can, it may have been charged to his checking account directly.

  9. #8
    Registered User Junior Member
    Columbus, Ohio
    Originally posted by Christine
    Butch, I don't follow this. According to the FCBA we have 60 days to dispute charges, IF they're fraudulent and a bunch of other conditions apply.

    Oh believe me, I know exactly what you mean. We've struggled valiantly with this issue. That of trying to figure out what in the world we would do with an OC when niether the FDCPA, nor FCRA applies. The general consensus on other boards is: there's just nothing one can do about it. This simply cannot be correct.

    Suppose for the sake of argument it were correct. Law guy's assertion that there would be MASSIVE fictitious bills sent to millions of people every day and there wouldn't be anything we could do but pay it? Hardly.

    I decided then, not being a lawyer, that this just cannot be right. There HAS to be some mechanism for redress. If not, then perhaps I shall send YOU a bill for $1,000 and expect it be paid.

    What recourse is available, by way of example, when a most complex and tough issue presents itself:

    An OC sends you a bill. They have not yet reported to the CRA's, nor have they turned it over to collections. Holly crap. Does that mean we have no choice but to;

    1) Wait until they DO report it and fight via FCRA, or;
    2) Wait until they turn it over to collections and fight via FDCPA

    We would be STUCK until one of those two things happen.

    My dad just found out that he was charged for a $500+ futon TWICE. He only got one futon. The store is now EMPTY, out of biz. But, it's after the 60 days, and the bank refuses to do ANYTHING since the 60 days are up.

    This is a little off topic, but if there's a way to make a creditor PROVE a LEGITIMATE charge-off, what can may dad do about a truly fraudulent charge in 2002?

    Does he have to default? I don't even know if he can, it may have been charged to his checking account directly.

    The situation becomes monstrous, now that the OC has information from which they may EXTRACT there fictitious payment. May it never be. This does produce a delimna, no doubt.

    The question then is: "What to do with an OC, PRIOR to CA intervention and PRIOR to CRA reporting".
    The answer to this question, at least in my humble opinion, cannot possibly be "NOTHING'.

    If we can hammer out this issue we can help so many people. It would permit us to "nip these problems in the bud" before they become overwhelming. That's why I'm beside myself to see an Atty. log on.


  10. #9
    Registered User Junior Member
    Columbus, Ohio
    So I dug and I dug and I dug. I came up with Uniform Commercial Code Regs, adopted by all 50 states. With a little help I developed a letter that has always worked. I've used it 3-4 times now for a few people.

    Basically it made the arguments I spoke of above with respect to UCC and Prima Facie Evidence. I'll dig it up tomorrow and put it here because I'd love to get a lawyers feedback on it.

    For now though, your Dad.

    To the bank it appears as though your Dad purchased 2 Futons, (assuming they also see the first payment. You didn't say.)
    But your Dads argument is that he's being charged TWICE for the same Futon.

    Banks as you know, are just as lazy and lie just as hard (well almost) as do CRA's and CA's. Or are they aware that only one Futon is envolved?

    Hopefully, your Dad still has not had the 2nd payment deducted. If that's the case I would fax my dispute directly to the bank and tell them you'll sue them if they make this payment. It's still your Dads account not theirs.

    If the payment has already been made ... well ... wow. :(

    Since the whole thing is so old and the OC out of bus. I just don't know what could be done short of filing a suit and launching a motion for document production, which of course would fail. But gawd the hassle.

    Maybe sometimes we make a mistake when arguing via FCBA. When we do we lock our argument into the time restrictions therein, the 60 days.

    Is this something he's known about since 02, or just discovering the problem? Is it a revolving account? How does this work Christine? You say that they may "deduct" from his checking account. Is it on a CC where they deduct payments from his checking account, or did he do business via bank draft from his checking account?

    If it is a CC and payment has not been made yet, or has within the last 60 days, how do they say there's nothing they can do? If payment is getting ready to come out it'll be on his next statement, thus beginning the 60 days.

    Christine, there's a way. We just gotta find it.

    Oh - also did the OC file bankruptcy? If so has the meeting of creditors happened yet?

    Edit: Dang! I just went back and reread your post Christine. Some of my questions are irrelevent since payment was made long ago. That's what I get for being up at 5am trying to read anything. LOL

    I'll check back tommorow.

  11. #10
    The high desert
    You better get some sleep!

    My Dad doesn't know anything about the futon shop other than that they went out of biz, according to security company for the premisis. He left FL for the summer last year and the mail delivery person decided to return all mail to sender, it's not clear to anyone WHY they did that. The friend who was checking his mailbox occasionally wondered why only very little mail was delivered.

    Then my Dad was back in FL in Nov, and he still didn't get any mail, after a few weeks he figured out what was going on, then had to PAY for the bank statements, and of course it took a while to have those sent. I THINK he used a checkcard and it went straight out of his checking.

    It's not really anyone's fault except his own. He thought that the bank would get a physical sales slip and that nothing like this could ever happen, and he's not big on paperwork.

    I think I was grasping at straws there, you really can't expect the bank to take the loss just because he didn't care enough to check his statements. It obviously was fraud by the merchant, and if I ever have some spare time, I'll do a search through the bankruptcy filings.

    On a related matter, I had 2 billing disputes with Cap One last spring, both were ignored until I mailed certified, and after providing LOTS of documentation they declined both claims. It'll be part of my suit against them.

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