FP after Charge off?

[Anonymous]

My wife made the mistake of hiring a credit repair company. They challenged two old charge offs from Amex. Of course her score went up but when we went to get a mortgage they requested that we remove Dispute notations on those two accounts. Apparently they didnt get the charge off removed. They just got a "Owner Disputes" notation placed which inflated her score.

My question is this. After we removed the two Dispute notations, Amex placed a new status on her account. As of May 2017 they updated the status to FP (Failed to Pay). This account was charged off in 2012. Is there legal grounds to have the new status removed? It seems they shouldnt be able to update a status to failed to pay AFTER the account has been closed and charged off.

any information is appreciated.

[Anonymous]

I think a creditor can update a status on an account at any time, whether it is open, closed, way after the fact, etc.  This seems like a case of poking the sleeping bear, where the bear in this case woke up and attacked.  I'm honestly not sure that much can be done here, unless you continue to push to get the baddie removed completely.

[RobertEG]

Neither the reporting of a charge-off nor closing of the account determines per se the current status.

An account can be paid, remain delinquent (failed to pay), be sold, etc., after either event.

Any account must by definition have a current status.  It is the snapshot of the status as of the last reporting.

Thus, one cannot have a status removed, it can only be corrected if inaccurate.

If the account remains delinquent (i.e., the debt is unpaid), then the current status is correctly one of delinquency, or failed to pay.

Finally, if the  current status is updated to any non-delinquency status, that does not remove the reported derogs, such as monthly delinquencies or a charge-off, which all continue to affect scoring.  Thus, correction of current status is to ensure that a party reviewing the report understands whether the debt has been discharged rather than removinig the scoring efffect of derogs.