Statement of "serious delinquency" does not make sense

[Smooth_J]

So I have been trying to find the cause of this for a bit now, so hopefully someone could help. When reviewing my credit data, I know I have two 30 day lates from ~1+ year ago and an account I have under a payment agreement. I never was late on that account...I just wanted to reduce the payments for a year due to other medical bills.

When checking my scores, I see the following:
You have a serious delinquency (60 days past due or greater) or derogatory indicator on your credit report.

Would this be due to the "payment agreement" that I setup, and the comment on the account: "Paying under a partial payment agreement"?

[Anonymous]

I'm not following, as you said you know you have two late payments.  I would think either of them if they were > 60+ days late could generate that statement.  I'm not sure about the payment agreement part, but comments don't impact score, only profile account data.  What source are you using to view your credit report(s)?

[Anonymous]

     It is important to note, as far as credit reporting is concerned by lenders, “paying under an agreement” is NOT the same as “paying as agreed.” According to the CFRs under the FCRA, if you have a $100 bill each month and you pay $99 a particular month; you can still legally be classified as 30-days late for that month after 31-days from the billing due-date cycle. Do it for two months and you are 60-days late, 3-months 90-days late even though you only missed 2 or 3 bucks. That’s the law and you are still, legally seriously delinquency. The only way to circumvent this is to get a written agreement with the lender to make partial payments that will be reported as “paying as agreed.”

Y

[Smooth_J]

Sorry I was not more clear. The two lates were only 30 day. I have updated the post to relect that.

[Smooth_J]

I cant seem to quote via phone, but in reply to ytzak:

my report always stated payed as agreed and both the lender and I agreed on the amount. The only thing that seemed to have possibly changed was the comment. Unfortunately, I dont have a report from that far back, but the history and everything else is clear on the account.

[Anonymous]

Smooth,

Again, comments should not impact score.  Also again, where are you obtaining your credit report from?  If it's from a CMS, I'd recommend getting a real hard-copy of your report from at least one if not all 3B and looking at the account in question on there.

[Smooth_J]

I am getting my reports from myfico and when viewing that account, it has red dots next to the status. However it has never changed from payed as agreed.

[Anonymous]

I would hit up annualcreditreport if I were you and get a real hard-copy of your credit report to see what's going on.

[Kree]

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@Anonymous wrote:

     It is important to note, as far as credit reporting is concerned by lenders, “paying under an agreement” is NOT the same as “paying as agreed.” According to the CFRs under the FCRA, if you have a $100 bill each month and you pay $99 a particular month; you can still legally be classified as 30-days late for that month after 31-days from the billing due-date cycle. Do it for two months and you are 60-days late, 3-months 90-days late even though you only missed 2 or 3 bucks. That’s the law and you are still, legally seriously delinquency. The only way to circumvent this is to get a written agreement with the lender to make partial payments that will be reported as “paying as agreed.”

Y

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I'm not sure if this is completely accurate.  While a person could keep getting lates, they generally would only be 30 days late in perpetuity as most accounting practices have payments applied in the following order,   Old principal, new principal, old late fees, new late fees, lein fees.(if late fees or a lein applies).  So instead of 30,60,90,etc they would be 30,30,30,30,etc. 

[Anonymous]

Hi Kree:

     What I was suggesting is based upon the Accounting Best Practices, Fifth Edition by Steven M. Bragg; Accounts payable best practices, Credit and Collections Best Practices found online at http://www.untag-smd.ac.id/files/Perpustakaan_Digital_1/ACCOUNTING%20Accounting%20Best%20Practices.p...  It basically states that the “outstanding interest and late fees (if applicable*) must be paid first, prior to a payment being applied to the loan principal.” This would mean that the first late month is 30 days late. In my case I stated that the next month they made a monthly payment minus $1. Now excluding late fees (which I did not mention but we all know apply), after the second month the borrower still owes $1 principle for the first month – thus 60 days late on month 1 and 30 late on Month 2. I agree that since I only used $1 dollar it would take a while to get to 90 days late without late fees; but most people do not pay all their payment less $1 per month. In reality if they only paid 75% of their bill and accumulated the normal late fees; depending on the interest rate and type of loan (CC differ from installment auto loans under the rules of 7/8) they would probably see something like 30, 60, 60, 60, 90, late (or 30, 60, 60, 90, 90 late) over a 5-month period. Fundamentally, unless they pay everything off (including any fees) in one billing cycle it is possible for the lates to remain for a while; but more likely it will increase initially slowly but rapidly expanding.

Y