a charge off question

trc1962 · ‎11-04-2015

I have a charge of with JC Penney for $741 and it was sold to a second tier collector. I have 2 payments left and the balance will be zero and I am wondering how that will show on my report? Right now JC Penney lists the charge off with a $741 balance, will that change when the debt is paid? Can JCP keep it listed that way after full payment? Thanks.

RobertEG · ‎11-04-2015

Have they notified you that the debt was sold, or are you just assuming it was sold based on contact from a debt collector?

Are you currently under an agreed payment plan with the creditor?

trc1962 · ‎11-07-2015

When I spoke to JCP they said they had "someone else" handling my account but they would not say whether it was sold or not, however some research on my credit report shows the charge off was transferred or sold and my credit Karma report calls it a "second tier collection." The second Tier people call themselves "Machol and Johannes" but the people I set up my payment plan with are not from Macholl and Johaness. I tried a pfd but they said I would have to talk to JCP about that and JCP said I would have to talk to someone else (a third party) about a PFD and they claimed to not have the account. In the end, Macholl and Johannes said if I did not take care of the issue I would face a lawsuit and thus I set up the payment plan. I am now more than halfway through the payment plan and just want to know how it will read on my report after and who to try and PFD. I have another charge off through US bank and am afraid to even wake up the sleeping giant. My last payment on that account was in early 2012 or that was when my account first became delinquent. The fun of repairing bad credit just keeps going and going and I feel like I am on a wild goose chase with some of these people.

Anonymous · ‎11-07-2015

@trc1962 wrote:
When I spoke to JCP they said they had "someone else" handling my account but they would not say whether it was sold or not, however some research on my credit report shows the charge off was transferred or sold and my credit Karma report calls it a "second tier collection." The second Tier people call themselves "Machol and Johannes" but the people I set up my payment plan with are not from Macholl and Johaness. I tried a pfd but they said I would have to talk to JCP about that and JCP said I would have to talk to someone else (a third party) about a PFD and they claimed to not have the account. In the end, Macholl and Johannes said if I did not take care of the issue I would face a lawsuit and thus I set up the payment plan. I am now more than halfway through the payment plan and just want to know how it will read on my report after and who to try and PFD. I have another charge off through US bank and am afraid to even wake up the sleeping giant. My last payment on that account was in early 2012 or that was when my account first became delinquent. The fun of repairing bad credit just keeps going and going and I feel like I am on a wild goose chase with some of these people.

https://www.mjfirm.com/

Machol and Johannes are "Attorneys" who can collect debts. SO...here we go...

I pray you have something in writing about a possible pay for delete with M&J. It seems JCP sold the debt to M&J Collection Attorneys, and imo the 3rd collection party has no legal standpoint. You're paying off the Collection Agency, run by Lawyers. This is all too weird for me personally, and ROBERT, chime in here brother! What the...attorney collectors? I'd also research this company ten fold, on Forbes, BBB, FDCPA websites.

AS FOR US BANK...

They transferred my account in a heartbeat to a JDB. While I have successfully dealt with US Bank, I am still battling the JDB (junk debt buyer). IF US bank has NOT sold off your account, beg and plead to arrange direct payment to them in writing before they sell it. IF you are close to 7yrs and it falling off, congrats, but they still may have the authority to sell it off and have a junk debt buyer try a zombie collection and post to your report.

In theory, you want to negotiate PAY FOR DELETE in writing when you have the funds to do so, if within the Statute of Limitations just in case they tell you to pound sand and attempt to serve, prior to making any payments.

RobertEG · ‎11-07-2015

The law firm is attempting to collect on the debt, and is thus apparently also acting as a debt collector.

If you have a credit report showing that they have reported to a CRA, then that triggered their requirement to have sent formal dunning notice, in which they were required to have identified the current owner of the debt. That would/should identify the current owner.

If, in reporting, they identified themselves as the owner, then it is presumed that JCP no longer owns the debt.

If JCP no longer owns the debt, then they were required per FCRA 623(a)(2) to have promptly updated their reporting to show $0 balance.

Since they apparently have not done so, then you have basis for filing a dispute with the CRA of the accuracy of their current reporting, which should show $0 if they no longer own the debt. They can, of course, always respond to a dispute by stating they still own the debt, which would clarify their position.

It is unclear as to who you set up a payment plan with, and what their legal standing is. If a debt collector and they have initiated communication with you, then they are required to also have sent dunning notice, so statng that they are a debt collector, and who they are attempting to collect on behalf of (e.g., the OC, Macholl & Johannes, or themselves). Dunning notice is required to be sent within 5 business days after initital communication with the consumer per FDCPA 809(a), and lack of dunning notice is basis for filing a complaint with the CFPB, and not as basis for a dispute under the FCRA.

Additionally, since they have not provided dunning notice, anY DV would still be timely, and thus you can send both debt collectors a DV request, requiring that they cease collection activities until they have first sent debt validation.

As for what is required reporting by JCP if the debt is paid, they are required, if they have already sold to the debt, to have already updated the debt balance to $0, so once that is done, they are finished with furnther updates.

Their reported charge-off, along with its reported amount at time it was taken, remains in your file until exclusion at no later than 7 years plus 180 days from the DOFD on the OC account.

If the OC still owns the debt, then they should be updating as the debt is paid down, and must then report a final balance of $0 when fully paid.

Again, payment does not remove the reporting of the charge-off, and of its amount at time it was taken.

trc1962 · ‎11-07-2015

I dug around and found on credit karma that a collection agency called "second round debt collection" purchased the old debt from Synchrony bank/JC Penney. The wierd thing is I never have received anything in the mail or by phone from this company, only Machol and Johannes Law Firm and my payment goes to Machol and Johannes for the charge off on the JCP account. Is this a bad thing? Are Machol and Johannes merely collecting for the "second round" company? I did receive a letter long ago from Machol and Johannes, nothing from second round. If Second Round owes the debt shouldn't I have received a letter from them verifying my debt? Lots of questions as I have left the 2 charge offs alone until I had to address it. The awful thing is my highest balance with JCPenney was $261, so they must have charged mega fees as they are asking for $741.

Anonymous · ‎11-07-2015

@trc1962 wrote:
I dug around and found on credit karma that a collection agency called "second round debt collection" purchased the old debt from Synchrony bank/JC Penney. The wierd thing is I never have received anything in the mail or by phone from this company, only Machol and Johannes Law Firm and my payment goes to Machol and Johannes for the charge off on the JCP account. Is this a bad thing? Are Machol and Johannes merely collecting for the "second round" company? I did receive a letter long ago from Machol and Johannes, nothing from second round. If Second Round owes the debt shouldn't I have received a letter from them verifying my debt? Lots of questions as I have left the 2 charge offs alone until I had to address it. The awful thing is my highest balance with JCPenney was $261, so they must have charged mega fees as they are asking for $741.

See Robert's Post for Citing which Codes when you send your disputes and complaints.

1. Check your real credit reports, not CK.

2. JCP should be reported as Transferred/Sold, Zero Balance. If not, they are wrong. See Robert's post for citing law references.

3. Second Round is an unknown third party who did NOT send a dunning letter. They are not following protocol, therefore they are wrong. Check Real Credit Report, get their address, and send a Debt Validation Letter CMRR. Then, dispute with CRA as this account was settled with someone else, NOT them, and tack on if you don't get your DV back as well. Get em off your CR.

4. Yup, Fees. Should investigate to see where those fees came from, as some could be from JCP's Late Fees, APR, and dare I fear, the Collection Attorney's tacking on some fluff.

You've got homework but this will all work out in the end.

trc1962 · ‎11-07-2015

Thanks for the reply and I will work on those things tonight as I have some free time. I will update and probably ask for more help.