Can someone shed some light on this situation?

[golo]

Hello everyone, i have an issue with an OC that i don't quite understand and therefore i plea for the help of you distinguish members.Alright, i defaulted on the credit card back in 2006 that eventually was charge off.Fast forward to this date,i have paid the OC and everything,but then i notice something strange on my report, is that the OC was reporting 2 TLs.Ok, afaik,they can report the charge off and a collection if it's sent to collections.But here is what i find interesting and i ask for you guys help,i disputed it with them several times the fact that in my report there's an installment TL from the OC,i never had an installment with them,only a credit card.Ok, when i disputed this drectly to them after too many attempts tru the CRAs,their response was and is that: "When the credit card was charge off the card is closed and transferred to installment loan for collection of any monies owed"  Is that accurate with the FCRA? It is correct for them to report like that?  Please help me understand as this is one of the hurdles i need to pass in order to raise my credit high enough to have a chance to purchase a house for my family.Thanks in advance.

Here is the response they gave tru the BBB.

[llecs]

I have seen other similar examples, where a CC or LOC is defaulted and transferred to a loan. I'd start by reviewing the CC agreement. If there's a clause in there saying they can do this, then I'd say it's accurate. Absent that, I'd call it into question.

[RobertEG]

I see zero basis for their practice.

The type of account you had with the OC is fixed by your account agreement.  If it was revolving, they cannot internally convert it to an installment loan.

I agree that it is incorrect reporting.  However, you are now in a bit of a bind.  You have exhausted the administrative FCRA dispute process, which does not require them to provide proof of their reporting, only that they investigate and verify its accuracy.  They have apparently done so.

If you cannot get third-party administrative resolution, such as by BBB or FTC complaint, that leaves you recourse of filing a civil action for incorrect reporting.

Judges can compel the production of documents or other evidence supporting their position and make a ruling in your favor.

[golo]

So basically Robert,they probably know its incorrect reporting and still stand their ground? So their reporting it's a violation of the FCRA?

[golo]

UPDATE! The complaint I filed with the BBB was closed by the BBB,stating that the OC did every effort to correct the issue.YEAH RIGHT! UGH! Oh well,I will file a complaint with the consumer protection bureau then,let's see if they have teeth.

[RobertEG]

Regardless of whom else you file a complaint with, you should definately file a complaint with the FTC. 

They are charged with administrative enforcement of the FCRA.

They will contact the party, and have authority to initiate legal action, although as a matter of practice, they dont do so for individual consumer complaints.

Some subsequent rights may also be dependent upon your having filed an FTC complaint.

[golo]

Thank you for your input Robert,I did file a complaint with the FTC.We will see,I will update. : )