Oct
24
Is it legal for a collection agency to list an old credit card account with a more current date?
Filed Under Credit
Shakwon asked:
when the 1st delinquency was prior to the date on the credit report? I had a credit card account which I opened in 1998 but on my report it stated it wasn’t delinquent until 2002. I heard that it is removed 7 years after it was opened. What is the most accurate information about how much longer it will be on my report? Also, is it true that a consumer can be absolved of the debt if the agency refuses to make payment arrangements?
I Live in MD
MARIANO
when the 1st delinquency was prior to the date on the credit report? I had a credit card account which I opened in 1998 but on my report it stated it wasn’t delinquent until 2002. I heard that it is removed 7 years after it was opened. What is the most accurate information about how much longer it will be on my report? Also, is it true that a consumer can be absolved of the debt if the agency refuses to make payment arrangements?
I Live in MD
MARIANO
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6 Responses to “Is it legal for a collection agency to list an old credit card account with a more current date?”
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DAMIEN
The account is dated the last transaction date, which can be anytime after it opened. If it transferred to a collection agency in 2002, then yes it can still be on your report from the date of transfer.
As for the debt not being paid due to payment arrangements, that is not true. Once you acknowledge the debt, you are obligated to it.
ZANE
It can stay up to 7.5 years from the original date of your first delinquency that led to the account defaulting….A collection agency cannot re-age or change the date of the original delinquency, yet some do to reset the statue of limitations….
Be sure the check the statue of limitations for your state.. This debt may be outside of the statute of limitations…meaning that they can’t take legal action against you.
LAMONT
They may be trying to avoid statute of limitations. Most states have laws saying how long a debt can be taken to court. In Texas it is 4 years. After 4 years the collection agency cannot take it to court, at least not legally. Some collection agencies specialize in picking up very old debt. They try to collect. That is still legal. According to federal law, though, if you tell them not to contact you about that debt anymore they are pretty much sunk.
They have ways around this though. If the person makes an attempt at repayment then the statute of limitations is reset. Asking for a payment arrangement could be considered an attempt at repayment even if they were the ones who contacted you. Another method is to wrap a new debt around the old one. The person would get a new credit card offer. They sign up for it but neglect to read in the find print that the old debt will be added to the balance on this credit card and thus making it a new debt. Some creditors will also try to change the dates on the debt. That would be illegal but some of these guys do not care one bit about that. They want the money. Ask them for proof of the debt. Hopefully, you saved the bills and stuff from back then. If there is a discrepency then contact your State Attorney General. Let them know what is going on. If you do not have the paperwork then contact them anyway. It might just be harder to prove what is going on though.
Finally, the consumer is not absolved of a debt if the creditor refuses payment arrangements. You will still owe the debt and they can still try to collect it. You request that they do not contact you anymore and then their only recourse would be to take you to court. However, there is nothing that lets you off the hook if they refuse to make payment arrangements.
Upon reading the first answer and then your question again, I now notice that you said the account was opened in 1998 but you became deliquent in 2002. The date should be 2002 on the report then. If it were not then any credit card that you held onto for more than 7 years would be uncollectible. You could max it out and walk away. The date of the deliquency is what is important. That is the same for statute of limitations as well.
GERARD
Negatives age off your credit report 7-1/2 years from the date of first deficiency, not the date the account was opened. Nothing restarts that clock.
It is an urban legend that creditor have to accept small payments as “good faith”. If you default on the terms of your agreement, the total amount becomes due and payable. The creditor does not have to accept any partial payment. They can take your small payments and sue you anyway.
Also, even if the debt is beyond the reporting period and the Statute of Limitations (SOL), the timeframe to bring lawsuit, collectors can still hound you for payment. They just can’t report the debt to the credit bureaus nor win in court.
COLLIN
Re-aging of debt is illegal! If this has happened to you, you should file a dispute with the credit reporting agencies immediately. Go online, get a copy of your credit report, and begin the online dispute. If they do not decide in your favor, call them and tell them that the collection agency is changing the debt in order to re-age it. It’s unconscionable for them to be doing this and many collection agencies have been sued by consumers (as well as the credit reporting agencies) who have done this.
Negative items fall off your credit report 7 years from the date of your last delinquency. If your first delinquency was in 2002, then it would fall off your report in 2009. On the credit report for Experian and Transunion (maybe Equifax) it will tell you when the item is scheduled for deletion. If the dates have been changed in order to extend the item, then you have reason to dispute.
It is important that consumers respond to collection agency notices when they receive them. If you request debt validation, the collection agency has to investigate your claims, and this usually means that they cannot report anything negative. The window of opportunity for disputing this is 30 days. If you don’t dispute in 30 days, then the collection agency can mar your credit report because they are allowed, by law, to assume that the debt is valid (but this in NO WAY assumes that you are liable).
Another reason to dispute is that it is important to make sure that the collection agency owns the debt. You’d be surprised at how often collection agencies collect on debt they don’t own, consumers pay, only to be sued by the real owner of your debt down the line. Don’t settle or pay until the collection agency PROVES that you own the debt.
Debt is not absolved unless it is paid or forgiven. After a certain amount of time, there are no legal remedies available — this is called the statute of limitations which varies from state to state. You can find statute of limitations info from this site (it’s a collection agency, but the information seems accurate):
If your old debt has hit the statute of limitations (SOL), then you’re in the clear. Legally, you can’t be forced to pay. Make sure that you challenge any debt passed the SOL in order to avoid negative items being on your credit report by debt collectors.
Good luck.
JEREMY
NO, this is illegal per se
RE-DATING OF THE DEBT IN VIOLATION OF
[CITE: 15USC1681s-2] § 623. Responsibilities of furnishers of information to consumer reporting agencies
a) Duty of furnishers of information to provide accurate information (1) Prohibition (A) Reporting information with actual knowledge of errors A person shall not furnish any information relating to a consumer to any consumer reporting agency if the person knows or has reasonable cause to believe that the information is inaccurate. (B) Reporting information after notice and confirmation of errors A person shall not furnish information relating to a consumer to any consumer reporting agency if– (i) the person has been notified by the consumer, at the address specified by the person for such notices, that specific information is inaccurate; and (ii) the information is, in fact, inaccurate.
Here are the rules regarding how long the debt is to be listed with the credit reporting agencies
Running of Reporting Period - Section 605 [15 U.S.C. § 1681c]
As of December 29, 1997 the reporting period runs 7 ½ years (7 years plus 180 days) from the date (month and year) of the last delinquency (known as “last missed payment:).
So, regardless of how long a creditor waits to charge off, sell or transfer a debt, they must report the true and correct “delinquent or last missed payment” date (month and year) that preceded the creditor’s action.
3. Example after Dec 29, 1997:
A payment was due on January 10, 2000 but, you failed to make that payment and never made another payment. The Creditor waits until August 2000 to take action (charge off, send to collections, sell/transfer debt, etc.) on the debt.
The 180 day count began on January 2000, (your last missed payment month) and runs until July 2000 at which time the seven (7) year reporting period begins and runs until July 2007.
4. Example prior to Dec 29, 1997
The reporting period runs 7 ½ years from the date (month and year) of the creditor’s action (charge off, sell or transfer) on the debt NOT from the last missed payment date.
A payment was due on January 10, 1996 but, you failed to make that payment and never made another payment. The Creditor waits until August 1996 to take action (charge off, send to collections or sell/transfer) on the debt.
The 180 day count began on the creditors action month, in this case August 96, and runs until February 97 at which time the seven (7) year reporting period begins and runs until February 2004.
Hope this answers your question