Tuesday, March 03, 2009

Pulled One of my Credit Reports

I have been doing a bit of reading/research concerning debt. I have written in the past concerning my past due debt and how I have decided to handle what I believed to be "zombie debts" or the more technical term TIME BARRED DEBT(S). Based on what I have read I have some digging to do (concerning credit reporting and Statue of Limitations), but I will share what I have found so far.

The biggest issue with "zombie debts" or "time barred debts" is the actual definition of STATUE OF LIMITATIONS (SOL) and what it entails. For starters a time barred debt (TBD) is a debt so old it is beyond the point at which a creditor or debt collector may SUE to collect. At this point the SOL (the time of commencing actions) comes in to play. It is simply the time allowed for litigation/lawsuits can be brought. It is a civil code and each state has its own statute. I live in Pennsylvania, our SOL is 4 years.

Based on this information I have 7 items listed on my credit report that would be considered timed barred debts. In actuality it is only 3 debts but 2 of them are listed twice and one is listed 3 times. In other words the original creditor is listed plus the 3rd party collection agency (from my understanding this is par for the course.)

The Fair Debt Collection Practices Act (FDCPA) does not prohibit a debt collector from trying to collect a TBD as long as they do not sue or threaten to sue you for the debt. [Note: Expired SOL is a defense to be used if you are sued!! The debt cannot be enforced by lawsuit; does not dismiss debt and can be reported on credit report up to 7 yrs.]

Another issue I found important to my situation is when the SOL begins. If you have never made a payment to your creditor the SOL for TBD starts when the first payment is due or at the onset of the contract signing. If you default on a debt that payment(s) have/has been made to, the SOL begins from the date of the LAST PAYMENT.

Issue number three deals with credit reports/reporting. My concern(s) in this area pertains to debts listed on my credit report(s) that are past the 4 year SOL and also 7 yrs old.

I found the following which both asks and answers my two concerns:
How do I remove a debt when the statute of limitations expires?

Credit bureaus can continue reporting delinquent debts even after the statute of limitations has expired. In a nutshell, the statute of limitations is the amount of time collectors can sue you for a debt. The CREDIT REPORTING TIME LIMIT is different. It's the amount of time credit bureaus can report delinquent account information on your credit report. The statute of limitations on a debt can expire before the credit reporting time limit for that debt expires. In that case, the debt can (and usually will) still appear on your credit report.

Can I remove debt collections from my credit report?

If the collection is accurate, you technically can't have it removed. You might be able to negotiate with the collector to remove the item in exchange for payment. Unless they're actively collecting on the account, debt collectors are rarely concerned with keeping your credit report updated. So, if a new collector has the account or you've already paid, you can try disputing with the credit bureau. If the collector doesn't respond in 30 days, the credit bureau must remove the collection from your credit report.
So based on this information it looks as tho I am stuck with the dung of a credit report. The key now is to make sure nothing more gets added, and that is something that I can control by being diligent with my money. Al tho I may try and get 2-3 items removed since I would only be dealing with the reporting agent and not the debt collector

These two articles Should You Pay an Old Collection and Tactics For Paying Off Debt Collections will be helpful in the near future as I do have some debt that is more recent and I want to get them cleared (they are medical bills, and I would like to continue to use the services provided.)

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