I came across a VERY interesting item on the HFC website. It listed HFC's annual 10-K report to the SEC, a required doc for stock exchange listed companys.This one is better reading than Enrons 10-K. I know I'm weird, who else actually reads a 10-K? Of interest to this board i'll quote the following from page 47 of the document :http://www.household.com/HFC10-K2001.pdf ----------------------------------------------------- Our policies for consumer loans permit reset of the contractual delinquency status of an account to current, subject to certain limits, if a predetermined number of consecutive payments has been received and there is evidence that the reason for the delinquency has been cured. Such reaging policies vary by product and are designed to manage customer relationships and ensure maximum collections. ----------------------------------------------------- It's in black and white, they do it. the SEC knows it and it is an internal policy. Wonder how many other companies have that in a 10-K ? JohnM
Hmmmmm, something everybody does but nobody talks about publicly. LOL Seriously, it isn't any different than Cap1 offering you a card with a chargeoff amount on it. Just another way to collect on old debts that are still on your report, but past the SOL. Gib
gib, The fact that I found this in a public document is what astounded me. If these are common statements in companies SEC filings, It is going to be hard for a company to say "we can't do that" it's illegal, immoral, against our contract with the CRA's, etc
Good point. I didn't think of that angle because I've only heard those excuses from a CA and not the OC. Then again, all my collections were medical collections. Gib
It is common practice for accounts to be re-aged after 3 consecutive payments. In fact, the Federal Financial Institution Examination Council (FFEIC) endorses the practice of re-aging OPEN but delinquent accounts once payments are re-established. This is a double-edged sword... scenario 1 BAD:if you fall behind, then pay 3 months such that they re-age and consider you "current" and then fall behind again and the account is eventually charged-off... the date of first delinquency will be pushed forward. You might as well have never starting paying again-- you would be better off! scenario 2 GOOD: if you fall behind, and then make 3 consecutive payments and keep making those payments, then you will not have to pay the money you missed in order for them to consider you "current" on your credit report. You will not have month-after-month of late pays-- this is definitely good. Understand? This "re-aging policy" does not apply to accounts that have been closed and charged-off.
