topic Re: DOFD on current mortgage when does 7 year rule begin in Rebuilding Your Credit

DOFD on current mortgage when does 7 year rule begin

Anonymous — Wed, 08 May 2019 19:57:48 GMT

I have a mortgage from Bank of America opened in 2005. In 01/2011, I became delinquent and was in the process of a loan modification. The loan modification took 15 months until 03/2013. My credit report shows late payments from 01/11 - 03/13 (the last 12 payments showing 120 day lates) and it has been current ever since. The credit bureaus will not remove the late payments from the DOFD but instead will remove them at the 7 year mark of each individual late payment. This means the last late (120 day late) won't fall off until 03/2020.

According to Experian: "If you had a single late payment in April of 2011, that late payment will fall off by April of 2018. If the account was brought current between April and September of 2011 and then the second series of late payments occurred, those late payments would be removed seven years from the first missed payment in that series. If you miss three payments in a row, your account would be reported 90 days late. The seven-year period would begin with the first payment you missed in that series. All three payments would be deleted seven years from that date. The date is called the "original delinquency date," or sometimes the "date of first delinquency." If the initial 30-day late payment was in September of 2011, that string of delinquencies would be removed by September of 2018." https://www.experian.com/blogs/ask-experian/when-does-7-year-rule-begin-delinquent-accounts/

However, Transunion and Equifax do not use the DOFD to remove late payments on the current account like Experian does, only on charge-offs and collections. In addition, TU and EQ do not report DOFD since it is over 7 years old. They claim it is not per FCRA to remove the string of late payments from DOFD.

Would someone please help me out? Am I out of luck in getting the string of lates removed from EQ and TU now, instead of 03/2013?

Re: DOFD on current mortgage when does 7 year rule begin

gdale6 — Wed, 08 May 2019 20:57:58 GMT

According to federal law each individual late drops at the 7 year mark there is nothing in it about a series being removed when the 30 is hit. A DoFD is not even set until the account COs and this one didnt go to charge off. I would expect each to fall as it hits 7 years until the account is positive completely once again. Welcome to the board

Re: DOFD on current mortgage when does 7 year rule begin

Anonymous — Wed, 08 May 2019 21:04:45 GMT

Thank you for your response.

However, did you read the remarks made by Experian (I also included a link in the previous post)?

Here is an excerpt from their FAQ: "If you had a single late payment in April of 2011, that late payment will fall off by April of 2018. If the account was brought current between April and September of 2011 and then the second series of late payments occurred, those late payments would be removed seven years from the first missed payment in that If you miss three payments in a row, your account would be reported 90 days late. The seven-year period would begin with the first payment you missed in that series. All three payments would be deleted seven years from that date. The date is called the "original delinquency date," or sometimes the "date of first delinquency."

Their response seems to differ from yours and it is causing confusion. Here is the link for the context: https://www.experian.com/blogs/ask-experian/when-does-7-year-rule-begin-delinquent-accounts/

This is in reference to an account that is now current but had a string of lates all beginning with the DOFD.

Re: DOFD on current mortgage when does 7 year rule begin

RobertEG — Wed, 08 May 2019 21:26:48 GMT

The legal answer is that exclusion of monthly delinquencies is based on an interpretation of the exclusion provision of the FCRA, and is not explicitly stated in the statute.

Experian's interpretation is that delinquency occurs when the account initially becomes delinquent, and thereafter, higher levels of reported delinquency are all just extensions of the same occurence of delinquency, and thus are excluded based on the initial date of delnquency.

However, there is anecdotal evidence, such as your own experience, where the other 2 major CRAs have excluded each reported delinquency at 7 years from its reported month, and considers each to be its own delinquency.

As background, FCRA 605(a) is the statute that covers exclusion of all adverse items of information reported to a CRA.

It includes subsections 605(a)(1) through 605(a)(4) for certain specific types of adverse items, such as BK, tax liens, judgments, and collections or charge-offs. Monthly delinquencies do not have their own specific subsection that defines in detail the provisions for their exclusion.

FCRA 605(a)(5) is the catch-all exclusion provision that specifically covers all other adverse items of information that are not explicitly defined under subsections (a)(1) - (a)(4).

It is thus the subsection that governs the exclusion of monthly delinquencies.

The use of DOFD only applies to subsection 605(a)(4) based on the clarifying subsection 605(c), which applies only to collections and charge-offs, and not to monthly delinquencies.

Subsection 605(a)(5) specifies broadly that such other items of information have an exclusion period of no later than 7 years from the date of the adverse item of information. The issue is thus interpretation of what is the date of the adverse item of information that begins the 7 year exclusion period.

One interpretation is that it is the initial occurence of delinquency that defines the begin of the exclusion period, and another interpretation is that each reported monthly delinquency of a higher level of delinquency sets its own separate delinquency begin date, and thus that each delinquency is separately excluded no later than 7 years from its individual month/yr of occurence.

The Experian interpretation is, in my opinion, the most logical, but either is still a valid opinion until the issue is appealed within the courts, and there is an appellate decision within the relevant judicial jurisdiction that then establishes binding case law interpretation of the statute.

There is currently, to the best of my knowledge, no case law that has provided a binding decision within any jurisdictions, and thus the best that one can do is to argue the Experian interpretation with the other CRAs and hope for the best until case law provides a binding interpretaiton.

You can, of course, become a pioneer and sue the other CRAs, thus obtaining an appealable interpretation that you can use to establish binding case law in your jurisdiction.

Until then, your interpretation is only that, and there is no clear violation of FCRA 605(a)(5).

Re: DOFD on current mortgage when does 7 year rule begin

gdale6 — Wed, 08 May 2019 21:25:12 GMT

@Anonymous wrote:
Thank you for your response.

However, did you read the remarks made by Experian (I also included a link in the previous post)?

Here is an excerpt from their FAQ: "If you had a single late payment in April of 2011, that late payment will fall off by April of 2018. If the account was brought current between April and September of 2011 and then the second series of late payments occurred, those late payments would be removed seven years from the first missed payment in that If you miss three payments in a row, your account would be reported 90 days late. The seven-year period would begin with the first payment you missed in that series. All three payments would be deleted seven years from that date. The date is called the "original delinquency date," or sometimes the "date of first delinquency."

Their response seems to differ from yours and it is causing confusion. Here is the link for the context: https://www.experian.com/blogs/ask-experian/when-does-7-year-rule-begin-delinquent-accounts/

This is in reference to an account that is now current but had a string of lates all beginning with the DOFD.

Experian can make their own rules as long as they dont violate federal law. I was just giving you what the actual law says. If they fall at same time consider it a gift.

Text of FCRA:

§ 605. Requirements relating to information contained in
consumer reports [15 U.S.C. § 1681c]
(a) Information excluded from consumer reports. Except as authorized under
subsection (b) of this section, no consumer reporting agency may make
any consumer report containing any of the following items of information:
(1) Cases under title 11 [United States Code] or under the Bankruptcy
Act that, from the date of entry of the order for relief or the date of
adjudication, as the case may be, antedate the report by more than
10 years.
(2) Civil suits, civil judgments, and records of arrest that from date
of entry, antedate the report by more than seven years or until the
governing statute of limitations has expired, whichever is the longer
period.
(3) Paid tax liens which, from date of payment, antedate the report by
more than seven years.

(4) Accounts placed for collection or charged to profit and loss which
antedate the report by more than seven years.5
(5) Any other adverse item of information, other than records of convictions of crimes which antedates the report by more than seven years.

Re: DOFD on current mortgage when does 7 year rule begin

Anonymous — Wed, 08 May 2019 21:30:24 GMT

Thank you for your very thorough research and response. If you know of any attorney's that would like to assist me in this pioneering adventure, please send them my way...as long as they are willing to work for notoriety and not pay. Then we would have a good shot at getting clarification and unity for this topic.

Thanks again!

Re: DOFD on current mortgage when does 7 year rule begin

RobertEG — Wed, 08 May 2019 22:18:55 GMT

If you wish a little more background regarding ambiguity on when credit report exclusion periods begins, then I take you back to the early to mid 1990's, where similar controvery raged over the begin date for the exclusion period for collections.

The current controversy over monthly delinuency exclusion directly parallels the prior controversy back in the 1990's over collections, and is worth reviewing.....

Similar to the current controversy over whether a higher level of monthly delinquency establishes its own begin date for the 7 year exclusion period, up until 1997, the reporting of a new collection was being considered by some CRAs as establishing its own begin date for the 7 year exclusion period for a collection under the provisions of subsection 605(a)(4).

Thus, each time a new collection was reported, some CRAs were resetting a new 7 year exclusion period, resulting in collections potentially remaining forever....

Rather than waiting for the various apellate jurisdictions to rule separately, with the possible result of there being different interpretations in each of the federal appellate jurisdictions, congress intervened and added a new subsection to FCRA 605(a), which clarified the various interpretations of subsection 605(a)(4) for collections by setting one specific date certain, now called the DOFD, as the single date that defines the begin of the exclusion period for collections and charge-offs.

Unfortunately, there was no equivalent controversy over the exclusion of monthly delinquencies at that time, so the amendment to the FCRA establishing use of DOFD for the first time applied only to collections and charge-offs, and did not extend to monthly delinquencies.

It would be preferable for congress to establish a nationwide and uniform standard for exclusion of monthly delinquencies by amending the FCRA to define use of DOFD for delinquencies in a common chain, but there is currently no legislation pending in congress for addressing this interpretation by way of statute.

The courts are the only current redress.......