When does collections become collections? USDA Loan

first off, you have an issue with this debt collector illegally reporting false info on your report. What you need to do there is dispute it with the credit bureau, stating that the incorrect info is causing you a loss.

As for your USDA loan, send a copy of that letter from 2007 to the broker and tell him that this letter proves that the dates on your credit report are both false and illegally reported. The letter should have the identifying info, such as account number and original creditor listed, so the broker should be able to compare it to your credit report entry to see the truth. In fact, I would do that before I dispute it with the bureau, just in case the debt collector tries to play some more games.

then, I would dispute it with the bureau and inform them that this debt collector is being dishonest--send them a copy of the same letter from 2007 as proof. Now, there's a chance that they will verify it to the credit bureau--they often do this without even looking at the information on the entry. So, if they do, then you need to send the debt collector a certified letter, informing them that they are in violation of the Fair Credit Reporting Act numerous times, and that they either need to correct it NOW or you will file a lawsuit against them. Inform them that their illegal and dishonest reporting is causing you a real loss at this point, and that if they choose not to fix their errors, you will not only sue them for the $1000 per violation that the FCRA allows, but you will also include the actual damages in the suit. In this letter, you need to include a copy of two things:

1-the entry on your credit report(s). If they reported it on more than one, include each one that it is on.

2-the 2007 letter that proves that their dates are wrong--it also proves that they know the actual information but instead chose to falsely report this debt.

Just so you know, at this point, there are several violations--here is a list of the ones that stand out based on what you have posted:

1--reporting a false date of delinquency
2--reporting a false date the account was opened
3--the update constitutes a violation if they continued to report the same false info, which they clearly have done. Each time they update the false info and claim it to be accurate they commit another violation.

Also, if they reported this on all three of your credit files, then the same violations apply to each report. In short, the FCRA allows you to sue for $1000 PER VIOLATION. If they make three mistakes on each of your three reports, that's 9 violations....you get the idea. Also, this activity constitutes a violation of the Fair Debt Collection Practices Act as well, because they have repeatedly misrepresented the character, amount, or status of a debt. FDCPA violations carry a max total of $1000 no matter how many individual violations they have committed. So, lets say they put this on all three reports. Lets say they made the same mistakes on all three. Those three errors have now become 9 violations of the FCRA, plus a violation of the FDCPA.....so you could file a lawsuit against them for $10,000 plus court costs, legal fees, and any actual damages that their errors have caused. Losing this loan, for example, was a loss that their errors caused. So, that's $10,000 in violations.....for a $168 debt.....I wouldnt pay them a thing. Instead, in this certified letter, I would explain all of this info to them and offer them this choice:

1--they can either consider the matter of this debt to be permanently closed. They will stop reporting on your credit reports. They will promise to never sell the debt to another debt collector or try to collect again on it themselves. They will provide you with a written statement saying that this matter is closed and that no further action will be taken regarding this debt. OR--

2--you will file a lawsuit against them for all FCRA and FDCPA violations, plus the actual damages you have suffered as a direct result of their false reporting.

Give them 10 days from date of the letter to handle this matter with the attention it deserves. If they do not answer then, go to naca.net and find a consumer attorney in your area, and sue the morons. Whenever I write a letter like this, I add a statement telling them that this is their one and only chance to avoid a costly legal encounter for such a small debt. I tell them that if this goes to litigation I will not accept any settlement offer, so this is their one and only chance to avoid the financial consequences of violating federal laws.

Actually FCRA violations are up to $2500 per violation not $1000. I don't see any FDCPA violations. By reporting a 10/07 date opened is not a violation if that is when they recieved and reported the account to the CRA's. It alos looks like they last updated their tradeline in 10/08 so if that show as Date last reported, there is no violation there either. As far as the DOFD, Is that listed under Date of First Default, DOFD First Reported or as "delinquent as of"? DOFD is often not reported on the reports depending on the source. Easy way is to call the reporting bureaus and ask for the DOFD as reported by the Data Furnisher.

Actually the $2500 penalty is only if the FTC presses charges against them:

FCRA Section 616. Civil liability for willful noncompliance [15 U.S.C. ?? 1681n(a)(1)(A)] states: "actual damages sustained by the consumer as a result of the failure or damages of not less than $100 and not more than $1,000".

The $2500 is actually:
FCRA Section 621. Administrative enforcement [15 U.S.C. ?? 1681s(a)(2)(A)] "In the event of a knowing violation, which constitutes a pattern or practice of violations of this title, the Commission may commence a civil action to recover a civil penalty in a district court of the United States against any person that violates this title. In such action, such person shall be liable for a civil penalty of not more than $2,500 per violation".