[ Outline ] · Standard · Linear+ Am. Ag. reports dispute to CRAs who do NOT report, the dispute notice to creditors???

[Chomsky]

Christine,

Recently, you were very helpful with my problem with American Agencies. I will summarize my problems and the steps I have taken here for the benefit of the board.

I recently performed a credit check and noticed a past-due account being reported by American Agencies for an old Pacific Bell account that I paid many years ago. I sent a fax to American Agencies requesting a validation of the debt. A week later, I received an account statement from American Agencies, which I faxed to you, and which you subsequently pointed out was not a validation at all. I then sent another fax, with receipt confirmation on, to American Agencies, saying the following:

"Thank you for sending me a statement regarding the debt that American Agencies believes I owe it. However, this statement is not a validation of the debt, which is what I requested you send me (and to which I am entitled by law).

"Please send me a validation of the debt immediately, along with the final bills from Pacific Bell."

I sent this on June 29 and have not yet received the information I requested.

I also disputed the debt with Credit Reporting Agencies. They "confirmed" the debt, or some such thing; the debt is still on my credit report.

My question to you now is, what do I do to get this deleted? What is the best and most effective way to achieve this?

Thanks so much,

Zachary Ross

[Chomsky]

Also, by the way, as of 6/18/04, my credit score was 695, and as of July 23, it is 692.

[Christine]

Also, by the way, as of 6/18/04, my credit score was 695, and as of July 23, it is 692.

If you have your credit scores, why not ANALYZE your scores and REVIEW the score factors?

I don't know where you got the idea that a collector has to validate a debt. nor do I understand why you would WANT them to validate.

From Requesting Validation from American Agencies, Step 1 of 2: It's so easy!

" American Agencies sometimes reports the dispute.

The FDCPA requires that they either delete the account or report the dispute to the credit bureaus until they validated the debt. They might even send you a notice stating that they received your dispute and reported it to the credit bureaus.

But the account can STILL be reported to creditors and Fair Isaac's credit scoring software.

The only way to find out whether the dispute notice is effective is to review the reports with the Fair Isaac credit scores. If you see American Agencies despite the notice of dispute, the collection is included in your credit scores.

How the reporting impacts on your credit scores depends on the rest of your credit. And sometimes the collections are NOT reported as "collections", but as "tradeline collection." If the account is reported as tradeline, the balance is included in the B/L ratio, lowering your scores more than a collection."

[Chomsky]

I don't know where you got the idea that a collector has to validate a debt. nor do I understand why you would WANT them to validate.

On the Better Business Bureau page on American Agencies, it says:

"The Fair Debt Collection Practices Act protects consumers from unfair collection tactics including, threats, harassment, and collection of fictitious debts. This law also requires debt collectors to supply documentation to substantiate the debt upon request of the debtor. If they are unable to present the requested documentation, you are not required to pay the debt."

http://64.60.4.195/scripts/cgiip.exe/WServ...drID=5&hAKAID=2

I figured, if American Agencies could not validate the debt, then I would be in a great position to have them delete the account altogether, or have the CRAs delete it. I guess I misunderstood the whole process. I just want to get the debt to go away, forever.

I'll analyze my credit report scores and figure it out.

[Christine]

I don't think you misunderstood anything.

If the account is not reported to creditors, you don't have a problem.

And you NEVER have to pay debts you don't owe, regardless of the FDCPA -- extortion and defamation laws apply.

[Chomsky]

Ok, so I looked at my credit report from Experian, who noted that my account with American Agencies was "updated". It says this at the bottom:

What factors raise your PLUS Score:
You have a good cushion of available credit between your current balance and your credit limits on all open trades. This has a positive affect on your credit score. This cushion shows lenders that you are unlikely to overextend yourself financially. If you keep paying your bills on time and keep your credit balances low, you will likely continue to enjoy a positive credit score.

The total balance on all your credit cards is relatively low compared to your total available credit limit. This has a positive impact on your credit score. If you continue to keep a comfortable cushion between your outstanding balance and your credit limit, you will show lenders that you are not likely to become overextended.

We don't show any record of recent inquiries on your credit report, which is helping to raise your credit score. Every time you apply for any type of credit or loan, the lender checks your credit history, and an "inquiry" is posted to your credit report. Having no new inquiries in the last 2 years shows lenders that you are less likely to open new accounts and fall behind in your payments. Remember that new inquiries are not necessarily viewed as negative, but too many inquiries on your file may make it difficult for you to obtain new credit.

You have at least 2 or more open major credit cards, such as VISA or MasterCard, on your credit report. This often tells lenders that you are a responsible borrower and they may be more likely to see you as a good credit risk and extend you credit.


What factors lower your PLUS Score:
Late payments on your credit accounts count negatively against your credit score, and your payment history shows one or more payments that were late by 30 days or more. Paying your bills on time, every time, is one of the best ways to positively impact on your credit score. Although negative information can stay on your credit report for seven to ten years, by paying overdue bills and making on time payments, lenders may recognize your good credit efforts.


Now, I have one other account, a VISA, that I closed a couple of years ago, and on which I had one 30-day past due payment. So, from what the report tells me above, I am unable to discern the effect, if any, that the American Agencies debt is having on my credit score. The payment status of the AA account says:

"Seriously past due date / assigned to attorney, collection agency, or credit grantor's internal collection department "

But the result of my dispute is:

Status Details:
This item was verified and updated on 7-2004

Your statement : Y ITEM DISPUTED BY CONSUMER


Where do I go from here?

[Christine]

"You'll be able to see if or how the account impacts on the FICO scores by the score factors."

You looked at the wrong score, please read the credit scoring basics at http://www.fight-back.us/forum/index.php?showforum=10

While this fake PLUS score does seem to ignore the collection (it doesn't mention it), that doesn't do you any good since no lender uses it.

[Chomsky]

Sorry for that. I got the FICO report. My Experian score is 720. It says, among a couple of other things:

Negative Factors
-- You have a Derogatory public record or collection item on your credit file

When I look at "Negative Items", the American Agencies collections debt appears. It also says:

Balance Date: May, 2004
Collection Status: Account seriously past due date/account assigned to attorney, collection agency, or credit grantor's internal collection department
Status Date: June, 1998

It says nothing of my dispute.


My Transunion score is 688. It also says:

Negative Factors
-- You have a Derogatory public record or collection item on your credit file

When I look at "Negative Items", the American Agencies collections debt appears. It also says:

Date Assigned: June, 2001
Date Reported: July, 2004
Date Paid Out: Not on record
Date Closed: Not on record

This again says nothing of my dispute.


The American Agencies debt does not appear on my Equifax report (which I guess is normal), and my score there is 717.

[Christine]

Wow, a 720 WITH the collection!

You obviously have extensive and excellent credit history on your Experian, and the 1998 status date probably decreases the impact.

And now you know that CREDITORS see this collection when they review the report since the FICO report is what creditors get.

And since you do not have any other collections or public records (that's important), you know that the FICO scores ARE rating the American Agencies collection.

Technically, American Agencies complied with the FDCPA by reporting the dispute. However, because the CRAs CONTINUE to report the collection to creditors, you are still being damaged.

While the Experian FICO is still high, you could well be looking at an insurance premium increase - see the PEMPCO rate schedule posted with the press release at http://www.emediawire.com/releases/2004/3/prweb113432.htm - your discount would be 13% less than with the highest scores.

So, you now have 3 options:

1) Send a certified mailing to American Agencies. Notify them that despite the dispute notice your credit scores are lowered. Demand notification of deletion within 5 days, preferably to your fax.

2) Get a lawyer right away.

Because you have such excellent credit, you shouldn't have a problem finding an attorney to take it on contingency.

3) Do nothing and live with it.

[Christine]

More info at the blog

The problem with the ineffective dispute notices doesn't just apply to American Agencies, it's a problem with credit reporting by the bureaus and the FDCPA needs to be changed to require deletion, not a dispute notice.

[Chomsky]

Christine,

thanks for all the help. Just to be absolutely clear, I want to mention that there is one other derogatory item in my FICO Experian report: a 30-day late payment on a credit card from 1999. This same item appears on my FICO TransUnion report.

There are no other derogs on either of these two reports. Again, my FICO Experian score is 720, and my FICO TransUnion is 688.

Is it still clear that the American Agencies debt is having an impact on my scores?

You are the best,
Zachary

[Christine]

The late payment is addressed by a separate score factor and may not show on your report - don't know since you didn't post everything. When you see "Serious delinquency, and public record or collection filed" or "Derogatory public record or collection filed" you know that it's NOT the 30 day late.

There's a listing of factors at http://www.bayhouse.com/FairIsaac-NextGen-risk-factors.shtml

They rewrite them a little for the consumer reports, but essentially it's the same.

With your high score you should have several factors that raise your scores. The TU FICO is MUCH more specific and useful, I hope you can get that.

[Chomsky]

Ok, here are all the details from my TransUnion FICO report (score 688):

Top Positive Factors

The positive factors listed below reflect areas of your credit behavior that are better than average, translating into a higher FICO score. Continuing to manage your credit this way will help to increase your FICO score over time. These factors are provided in order of impact - the first listed has impacted your FICO score most positively and so on.

There is no evidence of you having seriously late payment behavior being reported on your credit accounts
You have no evidence of seriously delinquent behavior (60 days past due or greater). Approximately 27% of U.S. population has evidence of serious delinquency information being reported on their credit file.

The score evaluates when your credit bureau report shows one or more serious delinquencies (missed payments) on your credit accounts. Studies reveal that consumers with previous late payments are much more likely to pay late in the future.

Making payments on time is one of the most important aspects of your credit management behavior that is evaluated by the FICO score. Continuing to meet all your credit obligations as agreed will reflect positively on your FICO score.


You demonstrate a relatively long credit history
Your most established credit obligation is 153 months old and your newest credit account was opened 11 months ago. The majority of U.S. consumers have a relatively long credit history - with the average age of their most established credit account being 15 to 16 years. In addition, the average time since the most recent account opening is 22 months ago. Click here to review your Accounts Summary.

This factor is based on the age of the accounts on your credit bureau report (the age of the oldest account, the average age of accounts, or both). Research shows that consumers with longer credit histories have better repayment risk than those with shorter credit histories. Also, consumers who frequently open new accounts have greater repayment risk than those who don't.

Avoiding a sudden ramp-up of new credit openings will help you to continue receiving positive points for this area of consideration by the FICO score.


Top Negative Factors

The negative factors listed below are reasons why your FICO score is not higher. Your focus on these factors will help you to raise your FICO score over time. These negative factors are provided in order of impact to your score - the first factor listed indicates where you stand to gain the most points over time and so on.

You have a Derogatory public record or collection item on your credit file
You have 1 collections assigned. Approximately 15% of the U.S. population has a collection on their credit report. Click here to review your Negative Items.

The score evaluates whenever there is derogatory public record or collection agency reference on your credit bureau report. Studies reveal that consumers with previous late payments are much more likely to miss payments in the future. However, as these items age and fall off the credit bureau report, their impact on the score will gradually decrease. (Most derogatory public records and collection items stay on your report for no more than seven years; there are other items that could remain longer.)

There is no "quick fix" to improve the score if the derogatory public record or collection item on your credit bureau report is valid. Keep in mind that satisfying or paying off the collection item or derogatory public record will not remove this information from your credit bureau report. The fact that it occurred is still predictive of future repayment risk, so it will still be considered by the score.


The time since your most recent past due payment is too recent or unknown
There is evidence of a late payment on your file as recent as 60 months ago. Roughly 45% of consumers have some evidence of delinquency in their credit history. Among these consumers, their most recent late payment was, on average, 20 months ago. Click here to review your Negative Items.

Analysis of consumer credit histories shows that consumers with previous late payments are much more likely to pay late in the future. The FICO score evaluates not only the presence of previous late payments, but also how recently the missed payments occurred. In general, the more recently a payment was missed, the greater the risk, and the lower the score. (Most late payments stay on your report for no more than seven years. Keep in mind that closing an account on which you had previously missed a payment does not make the late payment disappear from your credit bureau report.)

In rare cases, evidence of a past missed payment on a credit account is present on the credit report, but the date of the late payment cannot be determined exactly. An "undateable" credit account delinquency on a credit report still represents greater risk than never having missed a payment at all, and so it will still affect the score..

There is no "quick fix" to raise your score if the late payment on your credit bureau report is valid. In order to improve your credit rating over time, it's important to pay all bills when they're due. The longer you do so, the better the score. If you have late payments, get caught up on them and do your best to stay current. As time passes the importance of these previous late payments will gradually lessen and the score will increase - as long as you make your payments on time on all of your credit obligations, and use your available credit responsibly.


Derogatory Public Records
FICO scores consider the following public record information as negative: bankruptcy, foreclosure, garnishments, legal items and tax liens. This information is collected by the Credit Reporting Agency and stored on your file.

Derogatory Public Records: None on file.


Collections
A collection reference occurs when your creditor turns over an account you have not paid as agreed to a collection agency. FICO scores treat collections as negative items.

Collection #1
Collection Agency AMERICAN AGC
Original Creditor PB PAC BELL 3102120400
Account Number 464
Whose Account Individual Account
Date Assigned June, 2001
Date Reported July, 2004
Amount $68
Balance $141
Date Paid Out Not on record
Date Closed Not on record


Delinquencies and Derogatory information on accounts
Delinquency information is provided by the lender when you have missed a payment on your credit obligation. Other derogatory indicators, such as a comment with the credit obligation (for example, "account included in bankruptcy"), are also considered negative by the FICO score. Typically, late payment information on your credit obligations is reported by the lender as 30 days, 60 days, 90 days, 120 days, 150 days, 180 days late or as a charged-off account.

Account Type -- Revolving Account
Company -- MBNA AMERICA
Account Number -- 29001315XXXX
Current Status -- Paid or paying as agreed
Worst Delinquency -- 30 days past due
Negative Description -- No


Whew, that's it.

[Chomsky]

Christine,

I also wrote a letter to American Agencies that I have not yet sent. Maybe you have some comments on it:

August 3, 2004

Attn: Samantha (ext. 1054)
American Agencies
PO Box 2829
Torrance, CA 90509

Re: account LA-4645685-90

Samantha,

I have now twice requested validation of the debt American Agencies claims I owe. You still have not sent validation. (Attached hereto is my previous fax to of June 29 you requesting validation, with the transmission report and proof of receipt.)

American Agencies is thus in violation of The Fair Debt Collection Practices Act. Therefore I demand that you delete the debt and report that it has been deleted to the Credit Reporting Agencies: Experian, TransUnion, and Equifax.

Recently, it was brought to my attention that the American Agencies has an awful record with the Better Business Bureau (see http://www.bbbsouthland.org/bbb/companyreport.cfm):

"Bureau File Experience

We rate this company as having an unsatisfactory business performance record based on a pattern of complaints alleging unethical collection practices and failing to respond to complaints.

Complainants allege the company fails to provide proof of debt, attempts to collect debts paid or settled, threatens to report derogatory information if the debt is disputed, company representatives are rude and uncooperative in resolving complaint issues. Some also complain of extreme tactics, such as repeated phone calls or threats and telephone calls to place of employment.

The company responds to some complaints by providing verifications, clearing the debts, or closing accounts and stopping collection efforts. Many complaints remain unresolved, meaning the customers are not satisfied with the company's response. Many other complaints remain unanswered."

These allegations very much mirror my experiences with American Agencies. I have filed a complaint with the Better Business Bureau, as well as with the California State Attorney General and the Federal Trade Commission.

Furthermore, I have contacted SBC Communications, which acquired Pacific Bell at some point in the recent past, and they have no record whatsoever of any account under my name or Social Security Number. The fictitious Pacific Bell debt that American Agencies is attempting to collect has no basis in fact.

Delete immediately.

Zachary Ross


Thanks in advance.

[Christine]

Well, thing is, NOWHERE in the FDCPA is a requirement to validate a debt.

Is does not exist.

As I explained, it appeared that American Agencies complied with the FDCPA by reporting the dispute.

Either they NO LONGER report the dispute, or the CRAs are NOT reporting the dispute to the creditors, but only to you. Or Fair Isaac deleted the dispute notation.

So, I wouldn't send that letter because it does not address the issue at all and it's just more waste of time.

American Agencies couldn't care less about the BBB records. Don't you think they know what's there? Every time someone files a complaint with the BBB, American Agencies is contacted. How could they NOT know?

The BBB rating was one of my exhibits in my suit, because I wanted the JUDGE and the CRAs to know.

The Trans Union FICO report explains the problem in great detail:

"Top Negative Factors

The negative factors listed below are reasons why your FICO score is not higher. Your focus on these factors will help you to raise your FICO score over time. These negative factors are provided in order of impact to your score - the first factor listed indicates where you stand to gain the most points over time and so on."

The first factor is the American Agencies collection.

If I were you, I would call Mr. Kauffman at the FTC and ask for his mailing address. While technically American Agencies complied by reporting the dispute at some time, you are OBVIOUSLY suffering damages.

And, the dispute notation is not on the report you posted, so I'm assuming it's not there.

I would then mail a copy of the report and a summary to Mr. Kaufmann for review by their attorney.

You can send a copy of the FTC complaint letter to American Agencies LEGAL DEPARTMENT.

That might get the deletion.

And of course a lawsuit should be filed against American Agencies, Trans Union and Experian so that it can be discovered why the dispute notation was ineffective.

Ultimately, the FDCPA needs to be changed.