Expert: Michelle Dunn - 1/24/2009

Question
Hello Michelle and thank you for taking the time to help people like me on this website.

I have an old credit card debt that was bought by Arrow Financial Services.  I have a few questions regarding this matter.

1. Should the 'Date Opened' and 'Reported Since' dates match the dates of the original creditor?  My credit report shows the following:

1a. Arrow Financial: The date opened was 9/2008, and reported since 12/2008 which makes it look like a new account.

1b. Original Creditor: The date opened was 12/2005, and reported since 12/2005.

2. One credit bureau shows my account with Arrow Financial as being closed, and the other 2 credit bureaus show my account as open.  What does this mean, and does it matter?

3. I was informed yesterday by phone that Arrow Financial is charging me an 18% revolving interest rate on my debt, and that I had better pay before my balance reaches $1000 or I'll be sorry.  (She didn't say why I would be sorry, just that I would be and for many reasons).

#3-Q1: Can they charge me an 18% revolving interest rate?  Where can I find the laws regarding this matter?   According to the FDCPA 808(1) “It is unlawful for a collector to participate in the collection of any amount (including any interest, fee, charge, or expense incidental to the principal obligation) unless such amount is expressly authorized by the agreement creating the debt or permitted by law.”  So the FDCPA does not allow for the charge.  However, in regards to state law, I can only find Missouri state laws that refer to creditors which Arrow Financial is not.

#3-Q2: Do you have any idea as to why I’ll be sorry if my account balance reaches $1000?  It freaked me out.  Do I need a lawyer?


Thank you for taking the time to read this, and any feedback that you may be able to provide.  Have a nice day.
Kristin


Answer
Kristin,
1.  The date opened can be the date the account was started or the date the original creditor reported it.  The reported since date can be the date of the last or first payment.
2.  All three credit bureaus will have different inforamtion, it all depends on who reports to which bureau, not all creditors or collection agencies report to all three while some do report to all three. Some creditors will only report to one bureau, and some agencies may report to one, two or all three. If the closed account is an error, you can contact that credit bureau to dispute and have that corrected or maybe one of the others is wrong. Which ever one you have a problem with you would have to write to that individual bureau.
3. They may be able to charge you an interest rate, it would depend on your contract with them or the original creditor, if it provides for interest to be charged, they can legally charge it, it also depends on the laws in the state you signed the contract, you can check with the Attorney Generals office or look on their website. You state the FDCPA does not allow for the charge, but that is not true. It does not allow for the charge if it is not expressly authorized by the agreement creating the debt or permitted by law, which is why I advise to find your original agreement to see if it was expressly authorized, AND check with your attorney general on that state law. Creditors do not have to follow the FDCPA, only third party collectors.