1099- Chase still reporting balance

[nodnol214]

Hello!

So I received a 1099 a couple months ago from Chase for a CC that was a CO from a couple years ago.  I never made a payment on it.  Looks like they forgave the debt, but they're still reporting a balance, past due amount, and a monthly key derrogotory on all three credit reports.

What do I do?

[llecs]

When is the last reported date?

[RobertEG]

They have cancelled the debt, so must update their reporting to so reflect a $0 debt balance.

Call them and remind them of their obligation under FCRA 623(a)(2) to timely update their reporting so as to maintain its accuracy.

If they dont do so within a reasonable time, send them a direct dispute, with the asserted inaccuracy being their failure to comply with section 623(a)(2).

[nodnol214]

Hello- so I sent Chase a direct dispute (623) and just received a letter back stating "Our records indicate that account is charged off and currently reflects a balance owed.....we are unable to change the status of the account."  Hmmm..................  what do I do now?  

I called Chase and was told that they will continue to report a balance until I pay them what's due and that the 1099-C only means that they will not collect on the balance due but that the past due balance will continue to report on my account for 7 years.

Ugh.....help

[RobertEG]

They are not required to delete the reporting of the charge-off based on the subsequent status of the debt, be it paid, unpaid, or discharged.

A charge-off is simply their reporting of a prior business decision they made.  It does not excuse or cancel  the debt, or prevent further actions to collection the entire debt.

However, cancellation of the debt, as stated by their sending of a 1099c, does extinquish the debt.

Thus, you are entitled to update of the current debt balance to $0, but not deletion of the reported CO.

[nodnol214]

Thanks Robert.  I understand that the tradeline will remain, but how to I get Chase to understand that they need to update the balance to $0?  It's like talking a brick wall when I call them.  

[nodnol214]

Should I send a copy of the 1099-C and the dispute letter to Chase to the credit reporting agencies?  Would they force them to update the amount to $0?

[guiness56]

I would send them copies of whatever you have. 

[RobertEG]

When the facts of a case support, in and of themselves, a violation of the FCRA, which is apparently your case, the CFPB can enforce, and order their compliance.

I would send a formal complaint for lack of compliance with section 623(a)(2) to the CFPB.

[nodnol214]

In addition to the complaint I'm about to file with the CFPB, is there any reason to believe that filing a dispute with the CRAs would be of any help?

Thanks in advance for everyone's input on this.