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Late fees on loan reported as a charge-off, is it legal????

New Member

Late fees on loan reported as a charge-off, is it legal????

I had a loan w/ pioneer military loans that was paid by allotment every month.  Before I deployed to Iraq I called the company and asked them if they would take the payment out of my 2nd pay of the month instead of the 1st.  They said, sure no problem, it'll go into effect at the beginning of the next month.  Cool, right?  Well, since I wasn't around to go to the office to stop the allotment once it was paid off they kept taking the money out, like a savings account.  I came back, went in to stop the payment, they said we'll send you a refund check, great.  I get the check, cash it, loan is paid, I have money.  A month later I get a bill in the mail saying I owe $158.  I call and say what for?? the loan is paid, they say it's for late fees.  I ask them to send me account history, statement, etc.  I get a paper w/ a list of every month for the length of the loan w/ late fee next to most of the monthly payments.  Now they've put it on my credit reports as a charge-off like I never paid the loan.  I've disputed w/ all the credit bureaus and it comes back as valid.  Is this even legal?  what do I do??

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2 REPLIES
Epic Contributor

Re: Late fees on loan reported as a charge-off, is it legal????

It is not possible for Pioneer or any other creditor to take money from your mid month pay.  The way the military allotment works is half is taken from your pay on the 15th and the other half is taken on the first.  Then the entire amount is sent to the creditor as an entire payment.

 

If they said they would allow you to make payments in the middle of the month I would think that was their fault. 

 

Being due in the middle of the month and not receiving it until the 1st would definitley produce late payments.

 

Do you remember who you talked with? 

 

Try writing a letter to the CEO and explain what happened.

 

 

Message 2 of 3
New Member

Re: Late fees on loan reported as a charge-off, is it legal????

Now I'm thinking maybe it was taken out of my bank account.  Anyway, it was paid and they're coming after late fees, which I thought was illegal.  PFD might work even though I don't agree w/ them.  Thanks for the help.
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