Question: I recently disputed a 30 day late on my credit with Equifax. They came back and updated. Now it shows as a charge off. This was for an auto loan at a credit union that was paid off in 2008. I re-disputed it with Experian and it came back as verified. Now it is showing on all three reports as a charge off.
I have sent a letter to the credit union about 29 days ago at the same time as my second dispute. To this day they have not answered and it is still showing as a charge off…how do I get them to fix this?
Answer: Unfortunately that is the chance a consumer takes when engaging in the dispute process. The credit union updated the most current information they had on the account as a result of the credit disputes which is the charge-off status.
I do not know what type of letter you sent to the credit union; however, if it was a dispute letter, under the Direct Dispute Rule, they have 30 days to respond or the negative mark must be deleted.
If the letter sent was not a dispute letter under the direct dispute rule, you may want to try this method. Read further about the direct dispute rule, also known as the 623 method of disputing.
In the direct dispute letter to the credit union you may want to request accounting and payment history and what led to the charge-off status as it seems you were unaware the account had been charged-off.
It is possible the auto loan pay-off amount was incorrect and there was some residual balance remaining. If that was the case, it would have been nice if the credit union had notified you of any remaining balance instead of charging off the account.
Typically, an auto loan charge off is a result of a residual balance left after auto repossession. But in some instances the lender may be under a time-constraint in order to issue a charge-off which results in a charge-off without a repossession.
Whatever the case, you have the right to know what led to the charge-off and disputing under the direct dispute rule should at least get you that information.
This may be a legal matter, if so, you are on the right track because you have already disputed with the credit bureaus and the information was not only verified but updated to reflect even more detrimental negative information. Check with naca.net, they have a state-by-state listing of consumer law attorneys well versed in the Fair Credit Reporting Act. Good luck to you.