07-25-2012 01:30 PM
This is not my situation but I am trying to help my son-in-law. He has many charge-offs. A bad marriage and no job put him in this position. He is now gainfully employed and seeing brighter days married to my daughter. He left behind many bill and in his mind not seeing past due bills in the mail and not reporting to credit bureau makes him think he has been forgotten by creditors. Even though the bills don't show up on his credit report anymore, about 7 years ago, will they show if he applies for any type of loan. I say yes, especially if applying for a home mortgage or car loan. How can he take action to bring his credit current? I say a BK but he doesn't even know how he owes. This may be seen as total irresponsibility but he is a vey responsible person. He had just hit the pits and bottom of life and is now trying to pull himself back up.
07-25-2012 01:49 PM - edited 07-25-2012 01:50 PM
You are correct in that unpaid, delinquent debt remains until paid or discharged. A charge-off is an internal accounting measure, and does not eliminate either the consumer's continued responsibility for the entire debt, or the ability of a creditor or debt collector to continued efforts to collect the entire debt.
Expiration of SOL means it is time-barred from legal recovery, but not that it is excused.
CR exclusion means that, if reported, the CRA is barred from including it in a normal CR they issue.
The FCRA places no time restriction upon when adverse information can be reported. If the creditor assigns or sells the delinquent debt to a debt collector, they may report their collection. However, the FCRA requires that such reporting must provide the DOFD on the OC account, which is then used by the CRA to determine when they must cease inclusion of the CO in the consumer's credit report. The maximum CR inclusion period is 7 years plus 180 days from that DOFD.
Creditors who rely solely upon consumer credit reports wont discover the unpaid, delinquent debt from simple pull of a consumer CR after it has been excluded, but may obtain that info from other sources, such as by simply asking the consumer if they have any unpaid, delinquent debt, their own internal records, or records obtained from other sources. If, for example, he had previsously applied to creditor A, and they did a pull, they may still have a prior CR in their records.
You never know.
07-25-2012 02:43 PM
Thank you so much for this detailed information. So it's a chance or shot in the dark to see who has hung in there and who hasn't. I will forward this to son-in-law and he can mae his decisions.