QUESTION. I was considering disputing a few minor problems with the way some accounts are reported, but did my due diligence and read up on the subject first, hence, I am here.
Back in late 2013 I ran into financial trouble and was unable to keep up with my CC payments. The late fees were higher than the minimum payment which made it even worse, so I effectively gave up and let them go to ‘charge-off’ then ‘collections’ now back to only the original creditor as a ‘charge-off/sold to another lender’.
I periodically check my reports via online free report companies like Credit Karma for Transunion & Equifax, and yearly from annualcreditreport.com (but it only allowed Transunion). So I went directly to Experian for their free report online.
That is when I noticed that they had “Status Updated” & “Balance Updated” dates in 2015 on all three reports. But my Experian report shows the monthly payment blocks and those dates now have a little green “OK” online and with CLS under that month in the printed report, after about 18 months of missed payments & CO or FP. Even went through collections, but they gave up on me.
Tried to look up what CLS means and only found [CLS 47 Credit line secured — revolving terms], on the Experian site, and nothing else anywhere. What does ‘Credit line secured — revolving terms’ mean and why did they put a green “OK” on that month?
Sorry for the long drawn out question, but this may have a big impact in how I handle my credit report and dispute or not.
ANSWER. Reporting codes are used to maintain both prior and current account status. The current status of an account is what counts most in regards to credit scores. If the current status reflects OK under payment history it doesn’t mean that the account is no longer a charge-off, but that for some reason the creditor updated the status. As far as the account type code, CLS 47 Credit line secured – revolving terms; I don't think there's anything special about it. It’s just what it states — A code used for Experian credit bureau reporting which specifies the account type. Perhaps it may be an incorrect account code attributed to the charge-off but as long as it’s not hurting your credit scores, you may want to leave-it-be.
FOLLOW-UP QUESTION: Lisa, sorry to double up on this question, but it is important to me. More to the point, this may be a paperwork snafu. On the Experian CRA site anyway, they have me as a ‘green OK’ which to me shows paid with a zero balance.
Can I use that to my benefit? Dispute it as paid. Concern comes about if I dispute it, the clock starts over.
I really do not want to screw people out of their money, I offered to pay what I owed when it went past due, but they refused asking for both past due & over limit fees. The first of which was .12 cents because the interest took it over the limit. 12 cents cost me $35 over limit fees.
The question is, can I use their own paperwork and use it to my benefit?
REPLY TO FOLLOW-UP. You have to keep in mind that the credit bureaus’ client is the creditor, not the consumer. It may be their paperwork but if the credit bureau or original creditor “corrects” their paperwork, they could simply update the status and resubmit the accurate negative information back into your credit file. Now, of course, that’s a risk you have to decide whether or not to take.
But I just don’t think you have a “gotcha” moment and here is why: Experian has the history of the account from when the creditor first reported the account – from the inception to the charge-off to the current status. Incorrect reporting does not always result in a deletion, it could simply result in corrected reporting. What is likely to occur is that the dispute will result in an investigation with the original creditor being contacted by the credit bureau. Even with your support documentation, the original creditor can update the account to reflect the negative history.
As far as the charge-off itself, no matter how many times the creditor updates the status, the date the account is due to be removed from your credit reports will not change. Disputing it won’t change the date of first delinquency which is used to determine the 7.5 year reporting time-frame for charge-off accounts; so you don’t have to worry about the account remaining on your credit reports longer than the law allows.