Expert: Michael Brotherton - 7/3/2007

Question
QUESTION: Let me be specific to my situation.  I rented an apartment for about one year, after which I had a dispute with the management company and decided to leave.  Upon leaving, the apartment complex alleged that I owed them about 700 dollars.  This was not as a result of an eviction.  In any case, I disputed the charges with the apartment complex in writing and provided them with my new address.  Rather than resolving this matter in a court of law, the apartment complex simply reported to all of the credit agencies that I owed money.  It strikes me that the apartment complex, as well as many other types of private companies, uses reporting to the credit agencies as a means of extracting their pound of flesh when they have an otherwise untenable case or simply prefer not to persue the matter in court.  I did file an explanation with the credit bureaus, as I am entitled to do, but is there anything else I can do?  What's up with this?

ANSWER: First, do they have a valid claim? Did you break the lease. This is not a simple question if you had a legitimate dispute with them. You might check your state "Landlord Tenant" law to see if they actually violated your rights or affected the lease somehow.

You can dispute the validity of the debt with the company and file a complaint under the Fair Credit Reporting Act with the Federal Trade Commission or State Attorney General.

Make sure you do everything by certified mail, return receipt requested. If you can show this debt is invalid you may be able to get it removed from your credit reports.

Keep me posted.

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

QUESTION: I guess what I'm really asking is, why do the credit reporting agencies simply take the word of a creditor.  I have disputed this the credit bureaus, and they just say, "Well, we have verified that the creditor believes this is a valid debt, so we're leaving it on."  I don't believe the apartment complex has a valid claim, and I would be happy to defend my position in a small claims court.  In any case, it seems to me that this is a way that creditors have of sticking it to alleged debtors without due process.

Answer
Your observations are accurate. Many apartment managers rape tenants and in most case, get away with it. That is because no one ever fights back (or rarely). Stand up to them and plead your case if brought into court. Or if necessary, sue them to get the judge to decide and clear this up. Small claims may be the way to go.

Good luck