Excellent story...everyone read!

Hey,

This may get a little long but if you have a minute, read it!

This is for all those people that believe what CRA's report is gospel (not sure if any of them are here though) and for all those that believe, instead of spending months disputing things on your credit report, why not just pay them off? Here's why!!

As I mentioned to Butch, I am actually helping a relative get her credit straightened around but it is easier to talk in first person so listen to this.

Household Finance Corporation was listing a debt on her credit report of $1400. I sent them one letter stating that I did not believe I had any account with them that was past due $1400 and that I wanted a copy of a contract used to open the account and full accounting activity on the account adding up to the balance I owed. They replied with a Fraud Affidavit and absolutely no documentation.

In the first line of the Fraud Affidavit, it states something about I have examined the enclosed documentation and believe it to be inaccurate (yet, they didn't enclose any documentation). So they wanted me to commit perjury and sign this Affidavit without providing me with the documentation both I requested and the Fraud Affidavit refers to.

I sent them a letter back stating exactly that and once again asked for a copy of the contract etc. They replied once again, completely ignoring my letter, and state that we take fraud very seriously. Please sign this fraud affidavit so we can investigate further.

What happened was, in a previous letter, I said something like: This account may have been opened with an unauthorized signature or is being reported erroneously for other reasons and therefore I am requesting the following information." Since they probably had no documentation, they exploited "unauthorized signature" and based every subsequent letter around that fact.

Anyway, just recently, about 6 months ago, I started disputing the debt and because of recent activity, it was handed over to two collection agencies (despite it's disputed status). They even sent me a letter stating "This account will remain in dispute until 5/13/03. Please return the Fraud Affidavit by then." This account was also added to CRA's that they previously were not reporting to (again, despite the disputed status...they didn't even list the entry as disputed!). Both collection agencies inquired into my credit report and sent collection notices (again, despite its disputed status). I also disputed this debt through the CRA's FOUR times and each time, they replied stating it was verified.

Now, what actually happened is that this debt was paid off in 1999. My sister settled with them. However, they misplaced the records (and so did my sister). So, she had no proof she paid them off and is therefore why I was taking the hard route of proving she owed money vs. just sending them a receipt saying, we paid you a long time ago.

Anyway, after sending them 3 intent to sue letters (two to different company addresses and one via fax to the corporate offices), we finally received a reply. They finally realized she paid them off a long time ago. Here is the best quote: As much as we try to avoid administrative errors, they sometimes occur. We apologize for the delay in getting your credit report updated. To correct this situation, we have sent a request to the three major credit bureaus to remove our tradeline from your credit file as of October 1999 when the account was settled. Please be advised that this process will take 30-60 days."

So, in other words, they destroyed my sisters credit report since 1999 stating that she owed them money, they verified its accuracy four times when we disputed it through the CRA, they handed the debt over to two collection agencies that inquired into her credit report, and they refused to provide any documentation to support that she owes them money.

And all they have to say is administrative errors, they sometimes occur. I don't think so. My sister is tickled to death that they removed the account from her credit files but I think a lawsuit would be in order.

However, what can I get them on?

623(b) for failing to conduct a thorough investigation after I disputed it through the CRA's 4 times?

I can't get them on any 623(a) violations (ie. duty to correct and update information) since section (c) says I can't sue them for that.

Since she didn't actually endure any financial hardships from the account (she applied for credit on many occasions but always got declined), I can't sue them for causing her to receive a higher interest rate or something like that.

And, since Household is not a collection agency, I guess I couldn't hold them accountable for the violations created by the collection agencies they assigned the debt to (or can I)?

Can anyone think of anything? As a possible loophole, they did inquire into her Experian report 4 times after my fax to the corporate offices to make sure the entry was removed. Since this account was settled in 1999, I assume that means it was closed (it was an installment loan) and therefore since she didn't have an active account with them, those soft inquiries were not allowed?

I just really don't think what they did was right and although some people would just be happy to have it fixed (ie. my sister), I can't live with that.

Can anyone else think of an edge?

 

I figured the exact same thing. It won't hurt to attempt to sue them under 623 and if the judge doesn't catch it, great!

It was a financial hardship but she really didn't "lose" any money. Being declined for a credit card, as far as I am aware, could not be associated with a specific financial injury.

 

Re: Re: Excellent story...everyone read!

I don't know Butch, this is extremely hard to drop. She paid them off in 1999 so I don't think we have to worry about them putting anything back on there.

They have admitted they made a huge mistake and in fact they did. They have destroyed her credit for years and sent collection agencies after her for a long time attempting to collect on this. All because of an administrative error?

She didn't ask me to help her out until just recently so that is why it has been on there for so long. Actually, now that I think about it, I did write a letter to the collection agency a long time ago (probably about two years ago) showing proof that the debt was paid (she had the receipt then). They stopped contacting her but apparently Household didn't feel like stopping. But this was way back when I didn't know about this board or anything about fighting credit mishaps.

Man....I just can't live with that. If this was my credit report I would be steaming....well actually, I am a little irate and it isn't my credit report.

Since this was paid off, they really can't do much especially considering that they have admitted they screwed up and they admit she did pay and they admit they will remove the entry entirely. Any sudden changes would put them in more hot water in my opinion. Plus, the collection agency she paid a long time ago agreed to have all derogatory information removed (she has the letter, just not the receipt to prove she paid which we probably could get by faxing them or by contacting her bank for a copy of the old check). Unfortunately, it wasn't until the last week that she found this letter ;-(

I appreciate all your advice and you know I listen to 99% of it, but I think at least an Intent to Sue with a $3000 settlement outside of court is in order.

Administrative errors..HA!

 

Re: Re: Re: Excellent story...everyone read!

Thanks for the reply! I appreciate it. I will definately take you up on your suggestions. I am not too worried about anything showing back up on there. Now that I have the letter saying that the entry will (was) removed, if it does show up again, I will just fax the CRA's a copy of the letter and say there was a mixup...I am not sure why it came back on. I would also send the same thing to HFC along with the collection agencies letter stating that they would remove their entry entirely from her credit report.

Household is definately one of the dumber companies I have dealt with. Think about it...these people have lost a settlement from 1999 and have sent numerous collection agencies after her. They have verified things that don't exist, and so on. They respond to contract and statement requests with fraud affidavdits...trust me, these people do not know what is going on.

I will probably make up a release form to have them sign which will release them from all wrong doing contingent on the fact that I receive payment in full and they don't attempt, at any point in the future, to re-list this account on her credit report.

I'll show them! Thanks again!