Paid Charged-Off Updated / Score Dropped

[Dreams_Come_True]

Hello everyone,

I have an issue with a paid charge off that is being updated and causing my scores to drop significantly.  Back in March 2013 I helped my husband qualify for an auto loan with Regional Acceptance Corporation (RAC).  In 2017 he defaulted, and the account was charged-off.  RAC used a CA to collect the payment but the account was not sold. That account was reporting charge-off monthly in all 3 credit bureaus until it was settled in April 2020.  It was reported as charged-off again in May 2020 even when it was settled in April 2020, but I left it alone because after that it stopped reporting.

Since this is my only derogatory account, I decided to send some goodwill letters asking for adjustments, but it was denied every time.  The last letters and emails were sent on January this year, but they didn’t budge so I decided to wait for the auto deletion, which will occur in July 2024, based on the DOFD, which was in July 2017. 

To my surprised, when I checked my Equifax credit report this month, I noticed that they suddenly started reporting charged-off again up until March 2021!  They also added remarks on Equifax and TransUnion.  I sent them a certified letter last Monday and since then Equifax and TransUnion have been updated a few times.

They removed all negative marks from May 2020 to April 2021 but the way they did it appears it reset the time since last most recent late payment.  On my previous report in TransUnion I had 3 years 8 Months and now is showing 11 months. Equifax was showing 3 years and 7 months and now is showing 0 months.  The account was closed in August 2017, but they reported May 2020.  Fortunately, the DOFD remains the same.  All this changes and updates caused me 26 points in Equifax and 10 in TransUnion.  Not sure if they will update Experian as well. 

Part of the remarks updated are:

• Charged off account Auto Amount in high credit is original charge-off amount Paid charge off Auto.
• Payment after charge off/collection.  Paid profit and lost.

I also received an alert from Experian starting that RAC reported a new account. Just so you know, all I did was sent goodwill letters asking for adjustment.  I didn’t dispute the account through the credit bureaus. Now I’m afraid to do it because I know it will hurt me even more.   I don’t know what to do.  They haven’t answered my letter either and I don’t want to call as I want their response in writing.

Any advice on what my next step should be? Is even worth it submitting FCRA complaint? 

Thanks in advance!

[Anonymous]

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@Dreams_Come_True wrote:

Hello everyone,

I have an issue with a paid charge off that is being updated and causing my scores to drop significantly.  Back in March 2013 I helped my husband qualify for an auto loan with Regional Acceptance Corporation (RAC).  In 2017 he defaulted, and the account was charged-off.  RAC used a CA to collect the payment but the account was not sold. That account was reporting charge-off monthly in all 3 credit bureaus until it was settled in April 2020.  It was reported as charged-off again in May 2020 even when it was settled in April 2020, but I left it alone because after that it stopped reporting.

Since this is my only derogatory account, I decided to send some goodwill letters asking for adjustments, but it was denied every time.  The last letters and emails were sent on January this year, but they didn’t budge so I decided to wait for the auto deletion, which will occur in July 2024, based on the DOFD, which was in July 2017. 

To my surprised, when I checked my Equifax credit report this month, I noticed that they suddenly started reporting charged-off again up until March 2021!  They also added remarks on Equifax and TransUnion.  I sent them a certified letter last Monday and since then Equifax and TransUnion have been updated a few times.

They removed all negative marks from May 2020 to April 2021 but the way they did it appears it reset the time since last most recent late payment.  On my previous report in TransUnion I had 3 years 8 Months and now is showing 11 months. Equifax was showing 3 years and 7 months and now is showing 0 months.  The account was closed in August 2017, but they reported May 2020.  Fortunately, the DOFD remains the same.  All this changes and updates caused me 26 points in Equifax and 10 in TransUnion.  Not sure if they will update Experian as well. 

Part of the remarks updated are:

• Charged off account Auto Amount in high credit is original charge-off amount Paid charge off Auto.
• Payment after charge off/collection.  Paid profit and lost.

I also received an alert from Experian starting that RAC reported a new account. Just so you know, all I did was sent goodwill letters asking for adjustment.  I didn’t dispute the account through the credit bureaus. Now I’m afraid to do it because I know it will hurt me even more.   I don’t know what to do.  They haven’t answered my letter either and I don’t want to call as I want their response in writing.

Any advice on what my next step should be? Is even worth it submitting FCRA complaint? 

Thanks in advance!

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@Dreams_Come_True i'm very sorry this happened to you. You need to get your CR from annualcreditreport.com so you can determine exactly what fields have changed. Do you have a prior ACR  CR?

Since it is a paid chargeoff, it should go from the date of last payment rather than last update, I think. It seems they are making a point it was paid after chargeoff, But that should not change the fact, imho. I'm not 100% positive that it goes from date of last payment rather than activity, but my thought is it goes from the latter when it's unpaid.