Collections / Reporting

[Anonymous]

There is a collection I'm trying to mitigate the impact of on my report and make sure is accurate. Let's call it Auto Financial.  The original creditor is on all 3 of my reports, BUT I'm making payments to their collection agency who is not reporting on my credit. 

Auto has on multiple occassions denied my dispute I've submitted regarding payment.  The account is charge-off status, but they still list a payment of $331/mo even though the collections agency (and I've got payment stubs to prove it) are letting me pay only $50/mo which I've been faithfully doing for over two years now.  The issue is that the $331/mo is counting against my DTI in terms of mortgage application.  This debt is 6 years old- and my intention is to pay it off in the next couple months- but what can I do to get Auto Financial to either remove their entry from my report or get them to have it accurately reflect what I'm actually paying?

[RobertEG]

The common credit reporting manual used by the major CRAs provides for multiple codes related to payment amount.

The manual provides, under the base segment of the Metro 2 reporting format, a field code 15, titled the "Scheduled Monthly Payment Amount,"  a field code 16, titled the "Actual Pyament Amount,"  a field code 21, titled "Current Balance," and a field code 22, titled "Amount Past Due."

Together, they provide a complete picture of the account payment obligation.

For an auto installment loan, the contracted monthly payment is reported as the Scheduled Monthly Payment Amount, while the altered acceptance of a reduced payment while in default is reported as the Actual Payment Amount, with the Amount Past Due reflecting the delinquency, and the Current Balance updated monthly to show reduction based on subtraction of actual payments made from the prior monthly balance.

If a prospective creditor is using underwriting criteria that you feel incorrectly uses the original installment loan contract amount in calculating debt to income, rather than the actual (modified) payment amount, you have an issue with their underwriting, and not with the credit reporting being made by the existing installment loan creditor, providing they are properly reporting each of the above-listed elements.

Are they asserting that original monthly installment payment is proper under their underwriting criteria, even if you have a loan modification agreement that only requires a modified, and lower, monthly payment?