Incorrect reporting?

[CBARR82]

I currently have a HSBC account showing a $0 Balance after a CO on my report. The debt must have been sold to Portfolio Recovery. They are showing a balance of $219. Would someone please explain how this is possible please and thanks? :-/

[NWintellectual]

When an account is charged off and sold to a CA, both the OC and CA are allowed to report to the CRAs but only one (the legal owner of the debt) can report a balance. The OC must report zero. If, however, the OC still owns the debt and merely assigned it to CA for collection purposes, both can report balances. I know this because I have a few accounts that are in the same boat.

[MortgageMinded]

Credit Card Companies like HSBC sold their CC's to Capital One and they in turn sold the debt to PRA. Once they sell the debt they have to show your debt as CO to the CRA.

I have the same problem. Mine was also sold to PRA and communications have been difficult. Since your balance is low, I would suggest if they offer something off, take it (unless you don't owe the debt). I have to jump through hoops with a 1k bill and they are holding fast.

Good luck.

[CBARR82]

Great explanations! Thanks! I just started dealing with them yesterday and we didn't get off on the right foot. I have heard many horror stories, but scattered in are a few of success. Gotta keep on keeping on! I am going to initiate contact with them again Monday. Hopefully they will cave bc it is only $219.00, however I am not going to bet the farm on it. I will keep you updated. I have a running thread of rebuilding and am going to list all the different ways I attack negs until they are resolved. Once again thank you for the info!

[RobertEG]

No, an OC does not have to report a charge-off after sale of a debt.

A charge-off is an internal accounting measure that shifts the debt to a non-receivable asset, permitting them to write off the debt with the IRS as a business loss.

They can sell the entire debt without first having taken that accounting measure.

If they sell the debt, regardless of whether they have taken a prior CO, they must promtply report a $0 debt balance owed to them.

If an OC still owns a debt and has reported a remaining balance, it is not double reporting of the debt when their assigned debt collector then reports their collection.

What the debt collector is then reporting is not debt owed to them, but rather the amount that they are authorized to attempt to collection.