Late Payments - Long and Complicated :(

Discussion in 'Credit Talk' started by lil.sis, Jul 24, 2008.

  1. lil.sis

    lil.sis New Member

    Hi guys,

    First and foremost fantastic site. I have been doing a lot of reading and I have learned a TON about credit and I wish I had stumbled upon this earlier. So THANK YOU in advance. I look forward to becoming an active part of the community and helping the little guy in battles against THEY.

    That said, I have a bit of a problem on my hands here.

    I'm a 23 year-old college graduate who just returned from a year in China where I taught kids English. While I was over there, I had a relatively limited income (approx. $650 a month) so I applied for economic hardship deferral of my student loans (citibank and my university). in addition, before leaving, I had a $500 credit line with capital one (wish I'd known about this site earlier!), balance at 0, and a $500 credit line with HSBC at around $350. These are cards I started freshman year of college in hopes of establishing credit history so that I could do things like finance cars upon graduation (haha!). I did not spend out of my means, and I always made my payments on time.

    Before leaving I set up an automatic withdrawal from my bank account to pay for HSBC, around $20 bucks a month, and decided I would keep paying Capital One manually since it was a very small amount.

    So in July '07, I set up mail forwarding and ship over to China.

    It is important to note that up to this point I had been receiving e-mail reminders from HSBC that my payment was due. Then I set up automatic withdrawal. I have an e-mail saying I successfully scheduled the payment for 8/15/07. Then the e-mails stopped, leading me to think everything was fine. This e-mail address remained current for the duration of the year.

    In march, I decide to check on how everything is going (I know, I'm a moron). I log into what I assumed was my perfectly healthy HSBC account to find the dreaded warning in bold red letters: "YOUR ACCOUNT IS CLOSED! BALANCE: $730." Crap.

    Somewhere, there was an error in processing the online payment. The account was added to my online pay profile but the payments did not schedule correctly. To make a long story short payments on my HSBC card essentially halted overnight. And to make matters worse, my mail forwarding had not worked correctly, and all of my statements were lost in the mail. And I was in China. I had no way of knowing I was delinquent aside from the website, which because I'm an idiot, didn't think necessary to access.

    I called HSBC in a panic and explained my situation (I REALLY wish I had known about this site earlier). They sent me to a third party CA, who assured me that if I paid down the balance everything would be fine, and that the closed account wouldn't terribly affect my credit. (MAN I WISH I HAD KNOWN ABOUT THIS SITE EARLIER!!)

    I paid down the balance.

    Today, I ran my credit to see what was going on, and, surprise! My credit score is in the toilet, 604. And sure enough, there it is, in negative activity: HSBC; late payments 90 days, 120 days, 150 days. THANKFULLY they didn't report me as being in collections to the CRA's.

    However, I was upset to discover that my deferral application had been accepted by citibank, but declined by my university, and due to the mail forwarding error I was delinquent 90 days on those too! I never received the letter!

    I contacted my school and explained the situation and they told me to pay down the balance, and send proof of payment, and that they would wipe the negative entries within 60 days. I asked them if they could send me this in writing. He sidestepped the question and said that in 60 days I could file a dispute (Gotta start recording these phone calls! However, I'm inclined to believe him, since it's my university and they are invested in my future alumni payments). So that seems handled, for now...

    But the HSBC negative entry remains. At this point I was considering writing a GW letter, explaining my circumstances (which I believe are completely ridiculous but unfortunately true), and hoping for clemency. I am not an irresponsible person-- I just fell into the perfect storm of clerical mishaps. However, I can't help but wonder if I should try a more hard-line stance, in light of the fact that I was NEVER notified of these outstanding debts... these people can find you, if necessary, and my e-mail address was current...

    What should I do?!
  2. Hedwig

    Hedwig Well-Known Member

    I think you catch more flies with honey than vinegar. I'd try a goodwill letter, but address it to the executive office. Go to their annual report and see if you can find the names of people like the General Counsel or even the CEO. They might not personally handle it, but it will get special attention.

    Keep a copy of the letter. I don't think you want to do certified on a goodwill letter, but keep a copy and write down when you mailed it.
  3. lil.sis

    lil.sis New Member

    thanks for the advice hedwig. i sent the letter today. now i guess it's time to wait. updates to come

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