Expert: Apex Credit Services, LLC - 5/16/2008

Question
QUESTION: Hello,
  I decided to check my credit reports recently not  expecting any problems other than outdated info that could easily be taken care of. I thought this because I have been on SSD since 1991 and any credit card debt I had was accrued before then.It had been paid off or charged off long before now (before 1995) and either way is long past the SOL for reporting.Or so I thought.
  Two of my reports are clean or good. But Experian had 1 negative item that was reported in 12/2004. It is for a Lane Bryant account I opened back in 1989. The status is reported as Transferred/never late. It shows a high balance of $124 but recent balance is N/A. It will remain on my report until 2014.
  The problem is the last activity on this account was in 1990 and it was charged off before 10/1995. I don't have any of my old bills but I have an old Equifax CR from 10/25/1995 showing this same account reported by Lane Bryant as charged off. My understanding of the  FCRA rule is that they can't report it more than 7 1/2 yrs. from the original charge off date. Am I wrong? Wouldn't reporting in 2004 violate this?
  I disputed with Experian and they sent me an update of my CR that stated that transferred accounts that have not been past due can be reported and remain for 10 yrs. Is that correct? I can find no mention of this in the FCRA. I didn't think that selling an account or debt restarted SOL for reporting it. If it was transferred I have never received nor paid a bill from the new holder. The only name and address on the CR is WFNNB/Lane Bryant's.
 Sorry this is so long, just wondering what to do from here and wanting to make sure I have my facts straight. Very frustrated.
Thank you!


ANSWER: Michelle:

   It is the policy of the credit reporting agencies to report positive, closed accounts for ten years past the date of account closure.  It isn't permissible under the FCRA to fail to conduct a re-investigation however, one must show damages.  With that said, this account is not providing damages insofar as it is a positive closed account.  As such, we would advise you to leave it be as it has a positive effect on your scores if it contains to derogatory notation.  The language of transferring carries no such connotation.

  Now if it does carry a late payment or payments in the balance history, that is a different matter.  Please ensure that if this is the case, that Lane Bryant is reporting it and not a debt purchaser.  You will need to look at the creditor information to determine what is what.

         Apex Credit Services, LLC
         http://www.apexcreditservices.com

---------- FOLLOW-UP ----------

QUESTION: Hello again,
I was a little confused by your answer.How could an account that was reported as charged off in 1995 suddenly become a positive in 2004? And if it is a positive why is it listed as a potentially negative item? I guess I don't understand how this account could be reported in 2004 as apositive or a negative if there has been no activity on it since 1990 and it was charged off before 1995? Thank you!  

Answer
Michelle:

  You stated that it was paid "or" charged off.  When coupling that statement with the account status of "transferred/never late" per Experian, we deduced that it carried no derogatory connotation on the aforesaid report.  We also deduced this from the fact that it had no "past due" or "delinquent" balance.

  In any event, it makes no sense that Lane Bryant would be reporting an account with a date of status/date of last activity that was in 1990.  Therefore, are you stating that Lane Bryant is reporting this or the entity who bought the account?

  Regardless of the answer, a debt with this date of status cannot be legally reported per the FCRA prescriptions.  Our guess is that WFNNB sold the account in 2004 to a debt purchaser and that it is them that is reporting the account tradeline.

  Is that at all accurate.  If not, I would suggest you supplement your earlier request for re-investigation to Experian with a FACTA request for verification to WFFNB/Lane Bryant.

         Apex Credit Services, LLC
         http://www.apexcreditservices.com