Charge Off Question

I was reading through some other threads and I still have a few questions on some of the charge off accounts. For example,

My Fiance has two credit cards through the same company but one was opened in 1999 and the other in 2000. They are both listed as closed by the consumer but marked "charged off as bad debt". They both say the estimated removal date is 02/2008. And he opened these accounts in Michigan. The date they were both closed was 2001. So would the SOL be in 2008? And even after that, is it possible for the collector to try and collect this debt even after the SOL. I'm sorry i know you guys have had several posts on this I'm just trying to understand it all so I know where to start.

Correct me if I'm wrong:

Charged-off mark stays in your credit record for 7 yrs w/e state you belong to. Your credit card issuers made the reporting in 2001 because you could not pay the amount for some reason. These charged-off marks will go off automatically in 2008 as you have mentioned. This is influenced by 7 year reporting act of FCRA; this has no connection with SOL.

SOL for the state of Michigan is 6 yrs. SOL starts from the date you paid last for the account. Once SOL for a specific account is expired, no legal action can be taken against you, however, collectors can still try to get it. One payment towards a past SOL debt restarts the clock.

Charged-off marks hurt credit score like anything. A paid charged-off is somehow better. See more discussion on charged-off accounts here:

http://www.debtconsolidationcare.com...geoff-acc.html

In Michigan, the statute of limitation for legally collecting the debt is 6 years. This period starts from the date of last activity in your account. It appears that this account is within the SOL period. Although, it has been charged off, some collection agency will contact you for paying the amount. Though the negative information has entered your file for a period of seven years as per the FCRA laws, but still you can improve the file by giving a better view to it. Pay off this account and see this account posted as 'paid charged off.' There might be a very small increase in your credit scores with this status in comparison to what was previously. But if it's anything that matters here, its better.

Ok I think that's where I get confused.. So the SOL is just a protection against legal action?

If your debt account is within the 6 years timeframe as per the state laws of Michigan, the creditors or the CAs can take legal actions against you and get money from you.

If your debt is past the SOL period, i.e..it crosses the 6 years period, no CA or the OR can take any legal actions against you. They can't force you to pay the said debt. You can escape it legally.

EEK, That still sounds so wrong though! But thank you for the advice.

And speaking of which on the activity in his report I see CO from 2004-2005 but the account was closed 2001. But when I look at last activity it says 01-06-2006 so someone si updating something and we haven't done anythign to this account yet. So how would I find out what the actual date of last activity was?

Check the date you last defaulted on your payment in this account.

How would we do that?

hmm.. You now need to talk to your creditor and see if they can give you any details. Date of last payment made is shown in the CR as well.

Actually I have 3 different Cr's in front of me from different people and none of them say when the last payment was received. It looks like someone went in there and updated everything to this month! As in last activity says 1-6-06

Ok, but did you make any payment on 1-6-06 to this account?

I am assuming this might be an update from your agency. This has no relation with the date of last activity in your payment.

No. We haven't contacted this place at all. I know for a fact he hasn't made a payment to them since I've known him and that goes back to 2001. He didn't even know he had them until a couple weeks ago and we have been dealing with everything else.

That's why I'm saying something is not right here.

This gives you a fair chance to place a dispute with the Credit bureau. Highlight this item and request for some verification on this account. They will conduct an investigation and update your file. Most probably, if any information is missing or if it is incorrect, you will be sent a free copy of your file reflecting the change.

Yea I disputed this online and they sent us his credit report and that was only thing that was not changed. If I want details about this account do I have to contact the original grantor or debt collector?

The credit bureau must give you the results of their investigation done after you have placed a written dispute with them. Send your letter through certified mail with return receipt requested and keep your records in a file.

You can tailor this letter according to your needs.

The credit bureau must give you the results of their investigation within 30 days. It will be also better to write to the credit company and request for the information.

But he wasn't denied credit, Trans union just didn't give us any details about this account and just said the investiagtion came back and the account is verified.

I guess it's the same type of request but we won't be able to get his report for free becasue he wasn't denied.