Is it Legal for a Mortgage Company to Send You a Late Notice and Charge?

Posts Tagged ‘collection account’

Is it Legal for a Mortgage Company to Send You a Late Notice and Charge?

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Q: I am Single and Work One Job. My Mortgage is Upside Down. The Mortgage Company Keeps Tacking on Fees Other Than Late Fees. Is it Legal for a Mortgage Company to Send You a Late Notice and Charge You Even When You Know You’re Late?

A: Yes, a mortgage company can send you late notices and tack on late charges to your mortgage when you don’t pay on time. Unfortunately, those fees can add up, because sometimes they include penalties, added interest, collection costs, and maybe even attorney’s fees if they have to get lawyers involved. It doesn’t sound like you’re at the point of foreclosure, but clearly you are in a very difficult financial predicament. Based on everything else you said to me, it seems that you bought your home in 1990 when you children lived at home, but now they’re gone. You described a roof problem which will take $3,000 to repair, and you also have the added financial burden of having recently taken in 3 of your grandchildren. I think you need to be realistic about your circumstances and consider whether or not you can afford to live in the home you currently have. Chances are, the home is too big for you all by yourself. Also, I recommend that you begin the process of telling your adult children that you can not afford to take care of their children. I admire the love and selflessness that you have shown in taking care of your grandkids, but this entire situation sounds like simply too much. Unless your children are providing significant financial support for you to keep their kids (which I doubt), I think you should unwind that situation and simply tell your family that you are being buried under a mountain of bills. You said that you have a car note, as well as credit card bills, some of which have been sent to collection agencies, so that tells me you are really struggling to keep your head above water. Since you are working, talk also to your mortgage lender and see if they have any options to offer you, such as a forbearance or deferment on your loan, or perhaps a loan modification. Also look into the Obama plan, www.MakingHomeAffordable.gov and see if you qualify for that program. Good luck!

I Received a Letter Fron a Collection Agency for a Past Due Debt. Has This Account Already Been Reported on My Credit Report

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Author: The Money Coach

Q: I Received a Letter Fron a Collection Agency for a Past Due Debt. Has This Account Already Been Reported on My Credit or Will It Be After My 30 Days to Respond is Up? Also, is It Better to Pay the Creditor or Agency Directly?

A: If you are already more than 30 days delinquent in paying a debt such as a credit card bill, chances are the account has already been reported to the three main credit bureaus: TransUnion, Experian and Equifax. But you don’t have to do any guesswork about this. Nor do you have to take the collection agency at its word — regardless of whether or not it’s saying the report has been reported or hasn’t been reported. There’s a sure-fire way to know what’s on your credit report. It’s simply by taking advantage of your rights to get a free copy of your credit files from each of the “Big 3″ credit bureaus I previously mentioned. Just go online and get your credit reports and see for yourself. Look particularly closely at any records for “collections” or “public accounts.”

To get your free credit files, just go to: http://www.AnnualCreditReport.com.

Regarding your other question, I think it’s usually faster, easier and sometimes less financially costly to deal directly with creditors — as opposed to collection agencies. Those bill collectors often tack on additional fees, penalties, and other charges – expenses your creditors may be willing to waive.

Key Differences Between Equifax, Experian and TransUnion Credit Reports (askthemoneycoach.com)

How Long Does An Item Stay on Your Credit Report?

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Author: The Money Coach

Q: How Long Does An Item Stay on Your Credit Report? Which Date Do You Use for a Credit Card Opened in December 1984 that was Defaulted on (90 Days Late) In November 1986. It Went to Collection in January 1987. Which One of These Dates Applies When It Comes to the Statute of Limitations? When Will the Debt Come Off a Credit Report?

A: This debt should have long since fallen off your credit report. Under the Fair Credit Reporting Act, negative information such as the 90-day late payment you mentioned can only legally remain on your credit file for 7 years from the time of your delinquency. In your case, that would be seven years from the time you missed a payment or defaulted (i.e. November 1986). Because your debt is nearly 25 years old, it should definitely no longer appear on your Equifax, TransUnion or Experian credit files. If it does, simply initiate an online dispute with the credit bureuas and request that the credit account be removed on the grounds that this is outdated information. There is also a separate “Statute of Limitations” that doesn’t apply to your credit, but to the length of time after which a debt is no longer legally enforceable. After a debt, such as a credit card bill has run its statute, or expired, a creditor can no longer legally sue you in court, get a judgment against you, or do anything to pay you pay an old debt. In most states in America, the statute of limitations on old debts runs between 3 and 10 years. So again, from this standpoint too, that old debt should not cost you any money — or any worries.

Will Medical Bills Affect my Credit or Credit Score?

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Author: The Money Coach

Q: Will Medical Bills Affect my Credit or Credit Score?
A: Medical bills do not adversely impact your credit or your credit score, unless you have long overdue medical accounts that go into collections. In the latter case, a hospital or health care provider can turn over your medical bill delinquency to a debt collection agency or report an account in collections to the credit bureaus. Anything reported to the credit bureaus will hurt your credit rating. But just having a medical bills, even an account that’s 30 days old to 60, 90 days old or more, won’t automatically be reported to the credit agencies. Of course, you don’t want to tempt health care providers. Try to pay past due medical bills as soon as possible to avoid the potential threat of having an account go into collections.

Recommended Reading

Will a Collection Account for Just $50 Hurt My Credit? (askamoneyexpert.com)

How can I get rid of duplicate accounts on my credit report?

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Author: The Money Coach

Q: I Have an Adverse Credit Card Account on My Credit Report That Was Recently Purchased By Another Lender for Collection, Now Both Accounts, the Original Lender, and the New Collection Record, Are Listed. Can Two Records Pertaining to the Same Account Show Simultaneously on Your Credit Report?

A: It is not uncommon for two records to show up simultaneously on a credit report – particularly when accounts go into collections or is transferred for any reason. For example, student loan accounts, including those still in good standing, may be noted twice on a credit report, when a transfer or sale of the account has occurred. The fact that there are two records about the same account does not hurt your credit. What does hurt it, though, is the notation that your account has gone into collections. Any account noted in collections has a different “Status” notation in your credit file. A “Status” notation is simply a description of the status of your account at the time your credit report is pulled. It reflects whether you are on time, late with payments – and if so, how late. Status notations are found in the Account Summary section of your credit report.

Check Your “Status” Notations

Your payment history is shown on your credit reports as your “Account Status,” “Current Status,” “Pay Status” or just simply “Status.” Open accounts with no delinquencies will have these types of “Status” comments: “Pays as Agreed,” “Never Late,” or “Current.” Closed accounts with a positive credit history will be noted as “Paid As Agreed,” or “Pays As Agrees.” Negative information will most commonly be stated as 30, 60, 90 or 120-day late payments. Other negative comments include: “Collections,” “Settled,” or references such as “Paid, Was 60 Days Late”. If an account has been “charged off” or written off by a creditor as uncollectable, that fact will be noted too, typically along with the dollar amount charged off. Any status notation in your credit file that indicates that you did not pay your debts exactly as originally agreed will be viewed negatively by credit-scoring firms, and potential lenders.

When to File a Dispute

Generally, two record listings present no major cause for concern. There are, however, a few times when you might want to dispute a second record in your credit files pertaining to a collection account. If, for example, you paid an account before it went to collections, then you should dispute that item with Equifax, Experian and TransUnion. Additionally, if your terms or balance information shown on your account is inaccurate, that is justification for a dispute. Lastly, if the data shown is old or outdated (i.e. past 7 years), then you should dispute that with the credit bureaus and ask them to delete the account(s) from your credit files.

Ask The Money Coach

Posts Tagged ‘collection account’