IS an FP worse than a CO?

[Anonymous]

I have been trying to work w/American Express and got a letter to  agree to pay settlement amount listed as full settlement of the balance owed. My understanding was if I paid that amount  than the the balance would be zero. The bottom half of letter says upon receipt of full settlement no further attempt to collect balance. SO I paid and then they changed reporting from a CO charge off to an FP failure to pay. Is this situatiion worse, better or the same? Now the new debt release letter reads : we revcd payment. you completed terms. no further attempts made to collect remaining balance. I am wondering if  I made my situation worse?

[thornback]

I just responded to your other post regarding this Q. 

FP and CO are the same, status indicators notated in the payment history for each month the debt remained unpaid. 

Once an account has entered a charge-off status, it will always be a charge-off even once the debt is paid.   You did not make matters worse by paying the debt because now the derogatory account will no longer be upated with negative notations by the lender, allowing it to age.  As it ages, your scores will begin to recover -- though the charge-off will continue to suppress your scores for the entire time it remains on your reports. 

[Anonymous]

If you get a chance to go back to the other post I replied before I saw this.. thank you..well here goes  again.. ANY ADVICE

DO I contact American express again and get them change balance as the first half letter states? or do I make copies and write letter/dispute to credit bureaus??

my first letter reads: this letter confirms you agreed to pay settlement amount below as full settlement of the balanced owed.

but then on the bottom half of letter it reads: upon receipt of settlement amount no further attempts will be made to collect the remaining balance. So it looks like in the same letter ( now that I re read it  a few times) they contradicted their statements and I only seemed to focus on the beginning half of the letter. So I'm thinking i'm screwed because the new letter reads: we recvd your payment with this payment you completed terms of settlement no further attempts will be made to collect the remaining balance on your account. ( so that tells me that they clearly have left a balance on my report and now are reporting  FP.  Any advice

[thornback]

Sounds to me like they accepted the settlement amount as satisfaction of the debt and thetefore, not seeking payment for the remaining balance - which means the balance should reflect $0 on your reports.

They may have just screwed up reporting so I would first try to correct the issue with them directly.

Dispute with the bureaus if all else fails - and include a copy of that letter.

[Anonymous]

Thank you for the advice. Im going to try again with American Express....and if it fails  I will try writing to credit bureaus

thanks again

[thornback]

You're welcome - i hope it's resolved quickly with no hassles. Good luck!!

[RobertEG]

FP is not an official, reported delinquency status.

There is no such thing in the common CRA credit reporting manual and/or the Metro 2 reporting format, which is the required reporting codes, as "FP."

That is only a general and non-official designation that is used by commercial credit reports.

You need to view the actual credit file reporting code.

Creditors have the option, after taking a CO, to either report the currrent status and prior payment history profile status as either the monthly delinquency in months, or as a CO.  They dont report FP.

Additionally, once a debt is paid, the current status is no longer one of any delinquency, and thus CO can no longer be the current status.

It will be updated to Paid, or Paid, settled for less.  

Prior monthly payment history can still show CO for months prior to being paid, but can no longer show CO for any month after it was paid.

In summary, the current status of a previously delinquent account that is settled after a CO will show Paid or Paid, settled for less, and must show a $0 balance.  If the current status is stilll showing as some delinquency status, such as 180 late or CO, that is inaccurate and can be disputed.

[Anonymous]

It doesn’t really matter what their letter says....Their letter is confirming that you are not responsible for anything else, even though you didn’t pay the full amount. But what matters is what does your credit report say the balance is? You may need to give them a month or so to do the update, but the balance will be zero when they do it.

[Anonymous]

It doesn’t really matter what their letter says....Their letter is confirming that you are not responsible for anything else, even though you didn’t pay the full amount.

But what matters is what does your credit report say the balance is? You may need to give them a month or so to do the update, but the balance will be zero when they do it.