Direct Merchant Bank: are they in violation

[highNdry]

Hi

I have filed BK-7 and it was discharged on January 31, 2006. Direct Merchant Bank is not reporting as "included in Bankruptcy" to the credit agencies, but they are reporting as transferred/ sold and charged off. So I send them a letter that they are in violation and that they need to update their reporting to the credit agencies and the following letter I got from them:

DIRECT MERCHANTS BANK

PO Box 29423
Phoenix, AZ 85038

April 25, 2006

highNNdry

Account Number: XXXX-XXXX-XXXX-XXXX

Balance: $0.00

Dear highNNdry:

We are in receipt of your recent letter regarding the above account.

We have instructed the three main credit reporting agencies to report this account as "Transferred/Sold" with a zero balance.

This account has now been sold and we have forwarded your letter to the new owner of the account, Forward Properties. They may be reached at 1-800-467-4748.


Ira Dauer --
Senior Dispute Processing Associate


The following notice is required by federal law: We may report information about your account to credit bureaus. Late payments, missed payments, or other defaults on your account may be reflected in your credit report.

Looks like they are refusing to add "included in Bankruptcy, are they in violation? How can I make them add that info to my credit agency?

[highNdry]

that's very interesting and I would like to know the answer to that myself. i've noticed on Pacer that alot of our creditors have sold our debts to a company called ECast Settlement Corporation.....and have also noted the same the you are reporting on your credit report........sold or transferred. ECast is filing with the courts and the "new owner" of the debt.

I hope someone here can shed some light on how these transfers are supposed to be reported.

Why would anyone buy a debt that is included in a BK? Anyone here ever heard of ECast?

Hi

Direct merchant Bank sold the account before my BK and The collection agency is reporting "Discharged in BK". However, Direct merchant bank is refusing to report "discharged in BK".

For your question, they cannot pursue the bk account doesn't matter which collection agency they sell it to. Contact the collection agency and tell them that this account has been BK'd. The thing is Collection agency buys it in bulk so if you are in their system they think it's a legit account. I would mail and fax this collection agency right away and give them your BK number.

[highNdry]

Yes, I think it does. Any closed/ charged off account will hurt.

[Roadrunner]

If they sold it before you filed, then they are probably reporting it correctly. They updated it to $0 balance because they sold it-you no longer owed them.

The $0 owed is more important than the IIB, I think. Since it charged off before you filed, adding the IIB would not change the CO reporting now.