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Reaging Charge Off Every Monthly Payment

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Anonymous
Not applicable

Reaging Charge Off Every Monthly Payment

I have tried in vain to get a clear answer from so many sources including the bank.

I got a car loan recently and due to some unforseen circumstances fell behind. Next thing I know my loan was charged off and car repod.

The day it was repo'd I paid all the past due months making it current and got my car back. I am now able to make my monthly payments without a problem and was told my loan was reinstated.

The credit department of the bank made it clear up to their manager that even though I have a monthly payment, every time my payment is made it will re age the 7 years derogatory statement essentially making it look like I have a new charge off each time.

I don't have a lump sumo to pay the car and get rid of this loan. I just got it! 7 years plus the length of my loan seems incredibly punitive especially since I'm trying to make it right

I understand there's no way to get rid of the charge off but what are my rights here

How am I supposed to rebuild credit when paying my bill with hurt my credit every month???

I have read on here the bank can only count the 7 years from the date if the first late payment but the bank has been adamant and crystal clear that every payment I make they will renew the charge off on my credit report with the new balance

What do I do?!

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Message 1 of 10
9 REPLIES 9
RobertEG
Legendary Contributor

Re: Reaging Charge Off Every Monthly Payment

The bank/creditor does not determine when the reported charge-off is excluded from your credit report.

That is the responsibility of the CRA.

 

When a creditor reports a charge-off, they are required under FCRA 623(a)(5) to report the date of your first delinquency on the debt that immediately preceded their taking of the charge-off.  That date, called the DOFD, is the only date that determines ultimate exclusion of the charge-off from your credit report.

Once the CRA has received the DOFD, it is their responsiblity to monitor time expired from that DOFD, and they are barred from including the charge-off in any credit report they issue after 7 years plus 180 days from the reported DOFD.  They do not consult the creditor, and the creiditor does not report its exclusion.

 

Check the reported DOFD and make sure it is is accurate.  If so, dont worry about what the creditor is saying regarding its exclusion.

Message 2 of 10
Anonymous
Not applicable

Re: Reaging Charge Off Every Monthly Payment

Thank you for the feedback RobertEG

So when I make my monthly payments and they rereport the charge off with my new balance every month, is that considered a detrimental hit to my credit report? I have to make payments to keep the car. When I look at my credit report it just looks like a new loan that's charged off with a new balance. A third party that looks at it will just see a fresh charge off when really this is one account that keeps getting reported because I pay it currently

For the record the bank is Santander Bank and it looks like from these forums that this is something they do..

I will get hard copies of my credit report to track the DOFD because the way that manager made it sound, they will just keep changing it!
Message 3 of 10
RobertEG
Legendary Contributor

Re: Reaging Charge Off Every Monthly Payment

The DOFD is a clearly defined factual date-certain.

It must be the first date you became delinquent in the most recent chain of account delinquency that immediately preceded their taking of the charge-off.

They dont actually report the date they did the charge-off, and one reading your credit report would not assume that the continued reporting of the fact that the debt was charged off to be a new charge-off.

 

If the creditor alters the reported DOFD to a date based on any other event, that is a serious violation of FCRA 623(a)(5) thst would subject them to civil suit.

Message 4 of 10
bstone
Frequent Contributor

Re: Reaging Charge Off Every Monthly Payment

What I don't understand is how it was reported as a charge off.  I thought charge off status was reserved for when a debt was uncollectable usually 90-120 days past due?  Plus, if you redeemed the car your credit report should show as repo redeem, with payments reporting again.

 

I would file a complaint with the CRAs as a violation of FCRA.  If nothing else, this may be something you can speak with an attorney about.  Creditors who violate FCRA and lose in court (which is easy to prove in cases like this) pay your legal fees and you usually walk away with a few bucks as well.

 

Sometimes just a well worded "intent to sue" letter can also get things resolved without actually having to sue.

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Message 5 of 10
Anonymous
Not applicable

Re: Reaging Charge Off Every Monthly Payment

Yes it was over 120 days past due, then paid with the car returned to me
I don't see the repo being reported yet but the credit department was adamant that they were reporting correctly. A charge off even though I still have the car with the balance decreasing and re reported as a charge off each month

I have looked into filing a complaint but haven't because I was not sure I had a case
Message 6 of 10
bstone
Frequent Contributor

Re: Reaging Charge Off Every Monthly Payment

I would speak with an attorney, chargoff generally means they have written the debt off as uncollecable.

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Message 7 of 10
Anonymous
Not applicable

Re: Reaging Charge Off Every Monthly Payment


@bstone wrote:

I would speak with an attorney, chargoff generally means they have written the debt off as uncollecable.


Which simply means that from an accounting standpoint, they do not "expect" the loan to be repaid and its no longer considered an asset. It does not in any way preclude future repayment of the loan, or even re-instatement of the original loan terms. None of that would change the fact that the Charge Off was taken. The OP has the option to continue paying the loan off as agreed, while pursuing GW removal/updating of the CO status, or seek to refinance the loan. The problem with refinancing is that the scoring damage has already been done, and refinancing would be possible only at a very high interest rate. Not worth it, IMO.

Message 8 of 10
Anonymous
Not applicable

Re: Reaging Charge Off Every Monthly Payment

OP, what you might want to do is contact the EO and ask that the loan status be updated to "paying as agreed, was a charge off" - which is an accurate reporting of the loan.

Message 9 of 10
Anonymous
Not applicable

Re: Reaging Charge Off Every Monthly Payment

Thanks a lot

I did do one last call and got the EO address .. A PO Box and no number or point of reference (what's THAT about) and the rep kept reiterating that they are required by the credit bureau to keep re reporting a Charge Off with no such update.
What frustrates me is that I'm not even trying to get them to remove the charge off
I just want my activity to be reported fairly.
I will do research on goodwill letters although I admit I am highly skeptical this bank will extend an oz of consideration. I've never experienced an institution like this before and hope never to again.
I might as well start putting all my documents together for that conplaint..
Message 10 of 10
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