topic Re: Account Reporting Principle + Interest as balance in Rebuilding Your Credit

Account Reporting Principle + Interest as balance

IvDogg — Wed, 23 Apr 2014 21:54:50 GMT

6 months ago I took out a debt consolidation loan with a local One Main Financial, I recently noticed they were reporting my account balance as my principal + interest...

So my original loan amount was $10k at a rate of 23%. So it was reporting as like $17k as the balance at the start of my loan, luckily they did the same for the high credit/limit amount...

Are they allowed to report it like this? Should they only be reporting principle for account balance? And $10k as my high credit/limit amount?

Thanks.

Re: Account Reporting Principle + Interest as balance

pizzadude — Wed, 23 Apr 2014 22:45:58 GMT

Is this a simple interest loan or something else?

Re: Account Reporting Principle + Interest as balance

Shogun — Wed, 23 Apr 2014 23:39:26 GMT

I would say it's reporting wrong. That would be the cost if you paid it out to the end of the loan, but it's not what you owe.

Re: Account Reporting Principle + Interest as balance

IvDogg — Wed, 23 Apr 2014 23:41:15 GMT

@pizzadude wrote:

Is this a simple interest loan or something else?

If that's a regular loan, then yes... This is just a regular loan.

Re: Account Reporting Principle + Interest as balance

IvDogg — Wed, 23 Apr 2014 23:42:38 GMT

@Shogun wrote:
I would say it's reporting wrong. That would be the cost if you paid it out to the end of the loan, but it's not what you owe.

I agree, but does anyone know, if this is illegal? If I write them a letter will they properly update this to in accordance with reporting laws?

Re: Account Reporting Principle + Interest as balance

Anonymous — Thu, 24 Apr 2014 00:09:16 GMT

one main is the same as springleaf on these loans. its simple interest but calculated with the rule of 78's. so in essence this is the total balance that they expect to get i have the same on my report and i don't see what your problem with it is. when your done it will look like you paid off a loan that was bigger than what you got.

Re: Account Reporting Principle + Interest as balance

IvDogg — Thu, 24 Apr 2014 00:46:00 GMT

I'm not sure if it will help or make no difference, but I'm getting my credit report as clear as possible to apply for a mortgage. The difference is about $8k in installment debt.

Not sure if having that much of a difference in installment debt will make any difference when applying for a mortgage, but I heard the less debt the better.

Re: Account Reporting Principle + Interest as balance

pizzadude — Thu, 24 Apr 2014 01:03:47 GMT

@Anonymous wrote:
one main is the same as springleaf on these loans. its simple interest but calculated with the rule of 78's. so in essence this is the total balance that they expect to get i have the same on my report and i don't see what your problem with it is. when your done it will look like you paid off a loan that was bigger than what you got.

You'll need to look at your loan documentation and amortization schedule to determine how much you'll actually end up paying.

Re: Account Reporting Principle + Interest as balance

Anonymous — Thu, 24 Apr 2014 05:05:26 GMT

there is a calculator out there that is pretty accurate for 78 loans i cant remember what i searched for to find it. it is kind of a crappy loan. i would imagine since everything is set up for x time and the interest isnt calculated by the balance that you have left at the end of the month every month that reporting that way is correct. it may change if you pay the loan off early. by the time you have paid on the loan for a third of length you will have paid over 50% of the interest owed for the life of the loan. yes you read that correctly. you could maybe take your contract with you when you app for the mortgage.

Re: Account Reporting Principle + Interest as balance

IvDogg — Thu, 01 May 2014 19:02:57 GMT

Thanks for the feedback everyone, I've decided not to bother with this for now, the account is 100% on time, so I got bigger fish to fry... Will probably end up refinancing this for a better loan soon.