REPO/CO Toyota Balance Updated - Repo'd 2011 in Pennsylvania

[KELLYK]

Hi.  Looking for guidance. New poster here.  I having been working fevershly to clean up my credit over the past 90 days in order to qualify for USDA 1st time home purchase here in Pennsylvania.  To date one account is preventing  me from a pre-approved letter from the mortgage co.  Question is not sure why the account was changed/updated. Account is with Toyota Financial.  Car was voluntary repo that occurred back in 2011 -- last payment was around 3/2011 - Up until December 2014 account was reporting as Charge-Off on all 3 bureaus with a 0 balance.  For some reason, mid-December the account was updated and is now reporting as Open 10k balance.  After searching the boards I sent Toyota a letter (RRR) asking them to "please provide me with copies of the legal notices and proof of the commercially reasonable manner of the resale"; the letter also included language about continued reporting  of this invalid claim on my credit reports will be considered a violation of the FDCPA and FCRA.  Fast Forward -- its been over 14 days and I have not yet received anything from Toyota  -- they are still showing up with a balance on my credit reports as of today 1/2/15 -- What is the best and fastest way to resolve this one MAJOR roadblock - I believe we are still within the SOL - What do I do now that the 14 days has passed and they have not complied or updated my reports? Also, was it legal for them to update my reports with the balance - prior to December (for the past 1+ year) the balance was 0? Sorry but not sure where to turn next? ANY ADVICE IS MUCH APPRECIATED!

[StartingOver10]

kellyk,

I answered your question in the mortage forum. But to expand a little bit here, the voluntary repo is handled exactly like an involuntary repo on your credit report. It has the same credit hit.

When you start going for a mortgage or cleaning up your report, it is not unusual for creditors to come out of the woodwork looking for their money. The best time to negotiate with the creditor is before you ever get a mortgage inq on your report. Don't mention you want to buy a house or the creditor won't negotiate at all (they know they have to be paid before the lender will issue you a mortgage).

The most important part is for you to check to see if it is a judgment. The judgment may or may not be on your credit report, but it will show up in the public records of your county. So look there to see if they have gone that far yet.

If you can't find a lump sum to pay off the negotiated amount - then set up payments and make your payments ontime. I believe you have to show 12 months of ontime payments to have it accepted by underwriting - but I'm not sure.

[KELLYK]

Thanks.  I've checked the public records for my county and there are no filings to date.  Since this is still with the original creditor, where do you recommend I start as far as settlement offers?  Balance listed is 10k.  In your opinion, would Toyota ever accept an offer of say 1500 or 2K?

[StartingOver10]

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@KELLYK wrote:

Thanks.  I've checked the public records for my county and there are no filings to date.  Since this is still with the original creditor, where do you recommend I start as far as settlement offers?  Balance listed is 10k.  In your opinion, would Toyota ever accept an offer of say 1500 or 2K?

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I don't know what they will accept, but it is definitely worth trying. Personally I think that is a good amount to offer. If they do accept an amount for less, make sure you have a written agreement that the debt is settled in full with $X - and the remainder is not to be sold to other collectors.

[KELLYK]

Thanks so much for your advice.  Do you by any chance have a sample offer letter with that language that I can use as a template? Do I call them first or simply send letter?

[StartingOver10]

Here are some tips:

http://www.nolo.com/legal-encyclopedia/debt-settlement-negotiating-with-creditors

http://www.nolo.com/legal-encyclopedia/debt-collectors-collection-agencies

http://www.legalmatch.com/law-library/article/negotiating-with-creditors.html

You may want to check out debtorboards for more info

[RobertEG]

Did you ever receive a reconciliation of the remaiing debt after they sold the vehicle?

If the 10K amount is accurate, then the debt is owed, and there is no reason why they cannot update their account to reflect as such.

They could have deleted their entire reporting after the CO, and then decided to reinsert.  Perhaps not good business, but not a violation of the FCRA if their current reporting is now accurate.

The FDCPA is not relevant, as there is no debt collector.