Cancelled debt via 1099-C affecting UTI. No way to pay debt.

[Anonymous]

Hello,

I have a charge off from discover for 955 dollars from 3 years ago. They ended up canceling my debt and sending me a 1099-C. The main issue here is that the balance is still reporting on all 3 Fico scores, brining my credit score down significantly. Even though the debt was canceled I’ve tried calling discover multiple times to see if I can pay them in full so it stops effecting my UTI. They say they can not take any payment on the account because it was canceled and sent to the IRS. 

My question is can they legally be allowed to affect my UTI when there is zero possible ways I can make a payment even though I want too? What if anything can I do about this?

Thanks 

[gdale6]

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@Anonymous wrote:

Hello,

I have a charge off from discover for 955 dollars from 3 years ago. They ended up canceling my debt and sending me a 1099-C. The main issue here is that the balance is still reporting on all 3 Fico scores, brining my credit score down significantly. Even though the debt was canceled I’ve tried calling discover multiple times to see if I can pay them in full so it stops effecting my UTI. They say they can not take any payment on the account because it was canceled and sent to the IRS. 

My question is can they legally be allowed to affect my UTI when there is zero possible ways I can make a payment even though I want too? What if anything can I do about this?

Thanks 

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I suggest a complaint to the CFPB. This is unsettled law some courts have ruled they cannot have it both ways others have said yes they can have it both ways. Welcome to the board

http://www.consumerfinance.gov/complaint/

[Anonymous]

Thanks for the response. Is it worth it to also dipute this with the 3 bureaus ?

[Anonymous]

I have the same situation with Discover. I was told I couldn't pay it either, and to dispute with the CRAs, since they issued a 1099-C. Well, I disputed, and it came back verified, **bleep**....I have the $1861 to pay it, and that's what I'd rather do, but.....

YMMV, dispute, and let me know what happens

[gdale6]

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@Anonymous wrote:

Thanks for the response. Is it worth it to also dipute this with the 3 bureaus ?

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No it will just come back verified.

[Anonymous]

// I was told I couldn't pay it either //

Sorry for  the late response.

So the OC will not even let you pay off the balance due? I guess the OC can do that - prohibit you from paying the balance due. But why? Maybe because they would have to issue a Corrected 1099-C?

When is this item scheduled to come off your credit report?

[Brian_Earl_Spilner]

I feel like I'm missing something here. If you're receiving a 1099-C, the debt was forgiven. How is discover allowed to report that forgiven amount? Shouldn't it be reporting as $0?

[Anonymous]

Try attaching the 1099-C to the dispute and see if that helps. If not I would try to get something in writing from them stating that the account was forgiven and that they can not accept payment. If they send you something like that try attaching that to the dispute with the 1099-C and see if that works.

If all of that fails, then definitely file a complaint with the CFPB.