Unbelievable! Anyone heard of this? It's WRONG!!!

[TiredandWeary]

So, my hubby & I have been in Chap. 13 for 18 mos. now. We have been attempting to refinance our ridiculous ARM mortgage that went up an add'l 3% in October (to the tune of an extra $600 a month in our payment). My husband spoke with a potential Ch. 13 BK refi lender and when he pulled our credit reports, he said that our current mortgage lender had us marked as past due since May 2007!!! WTF???? We've been making payments on time to the trustee ever since Sept. 2006! Our payments include the mortgage. The trustee has not dispersed anything as of May 2007, but that is not our problem. Our attorney advised us that it does not matter when the trusteed disperses payments...that it should not be affecting our credit scores in any way because that is the whole point of a Ch. 13...he said that the benefit of a Ch. 13 is that by making regular payments to the trustee, it is designed to help you rebuild your credit [of course].

So, how in the world can our current mortgage lender even get away with flagging us as late on our credit report? I checked mine to verify that it was showing this and it is indeed true! It says past due as of Sept. 2007, which is slightly askew from what the potential lender said his info was showing. But, nevertheless, it is ALL UNTRUE information! This is illegal!!!! Their inaccurate reporting on our credit reports is causing us to not be able to refinance since you must have on-time mortgage payments for the last 12 mos. when in Ch. 13 in order to qualify for the FHA refinance loans. How can the mortgage company do this? IT IS WRONG!!!! Our attorney specfically stated that they are in direct violation of our Ch. 13 confirmation order!! There is no such thing as a late payment on your file with creditors in a bankruptcy, according to him! Furthermore, as I said earlier, we've been making timely payments to the trustee ever since the plan started and I have consistently verified that all payments have been posted with the 13datacenter website all along!

I smell a serious lawsuit or in the very least, a serious reprimanding by the judge to our blasted mortgage lender that even dared to put this false info in our credit report! We're in a Ch. 13 after all, for Pete's sake!! This is SO ILLEGAL!!! Anyone else out there had something similar happen to them so far?

I am so steamed!!!!!!! Grrrrrrr!!!!!!

[chpxiii]

Glad you got that out of your system.

Pretty much every creditor reports illegally. They don't care. It's YOU that gets f@cked over.

Ask your lawyer if he'll write very stern letters to your mortgagers to correct their information and start to report correct information to the bureaus and in the language put your ITS (Intent to Sue). He should know what to say: i.e.this is considered collection activity and in violation of bankruptcy stay, etc. etc.

And then be prepared to go to court over it. Read the http://www.creditboards.com forums. They have a TON of great information and they can help you get your information corrected as well.

[HeatherB]

They did this to me with my car. Said I was late for a long long time. I simply disputed it with the Credit Reporting agency and they changed it after I disputed it.

It is maddening, isn't it. I found it strange that only ONE of my credit reports showed it this way. I'm thinking the car people knew what they were doing and trying to get away with it because the company was pulling my CR every 3 months! (I'm wildly assuming it was to make sure I wasn't checking it) How is it that the other 2 were correctly listing and not this one. Hmmm.

[TiredandWeary]

Glad you got that out of your system.

Hehe..yes, thanks. Although it's not exactly all out of my system yet! :o)

Pretty much every creditor reports illegally. They don't care. It's YOU that gets f@cked over.

~How can this continue to go on in people's lives? You'd think the BK laws to protect the BK filers would have nipped this practice in the bud from the beginning by now!

Ask your lawyer if he'll write very stern letters to your mortgagers to correct their information and start to report correct information to the bureaus and in the language put your ITS (Intent to Sue). He should know what to say: i.e.this is considered collection activity and in violation of bankruptcy stay, etc. etc.

And then be prepared to go to court over it. Read the http://www.creditboards.com forums. They have a TON of great information and they can help you get your information corrected as well.

Thanks for all that great info! We'll see what the attorney advises next. I just can't stand the idea of another long and drawn out scenario trying to rectify all of this misinformation. It's bad enough being in the BK for 5 years, let along having to work out bugs such as dirty tricks by the creditors.

[Flamingo]

So, my hubby & I have been in Chap. 13 for 18 mos. now. We have been attempting to refinance our ridiculous ARM mortgage that went up an add'l 3% in October (to the tune of an extra $600 a month in our payment). My husband spoke with a potential Ch. 13 BK refi lender and when he pulled our credit reports, he said that our current mortgage lender had us marked as past due since May 2007!!! WTF???? We've been making payments on time to the trustee ever since Sept. 2006! Our payments include the mortgage. The trustee has not dispersed anything as of May 2007, but that is not our problem. Our attorney advised us that it does not matter when the trusteed disperses payments...that it should not be affecting our credit scores in any way because that is the whole point of a Ch. 13...he said that the benefit of a Ch. 13 is that by making regular payments to the trustee, it is designed to help you rebuild your credit [of course].

So, how in the world can our current mortgage lender even get away with flagging us as late on our credit report? I checked mine to verify that it was showing this and it is indeed true! It says past due as of Sept. 2007, which is slightly askew from what the potential lender said his info was showing. But, nevertheless, it is ALL UNTRUE information! This is illegal!!!! Their inaccurate reporting on our credit reports is causing us to not be able to refinance since you must have on-time mortgage payments for the last 12 mos. when in Ch. 13 in order to qualify for the FHA refinance loans. How can the mortgage company do this? IT IS WRONG!!!! Our attorney specfically stated that they are in direct violation of our Ch. 13 confirmation order!! There is no such thing as a late payment on your file with creditors in a bankruptcy, according to him! Furthermore, as I said earlier, we've been making timely payments to the trustee ever since the plan started and I have consistently verified that all payments have been posted with the 13datacenter website all along!

I smell a serious lawsuit or in the very least, a serious reprimanding by the judge to our blasted mortgage lender that even dared to put this false info in our credit report! We're in a Ch. 13 after all, for Pete's sake!! This is SO ILLEGAL!!! Anyone else out there had something similar happen to them so far?

I am so steamed!!!!!!! Grrrrrrr!!!!!!

Welcome to Chapter 13 and credit reporting! What you have experienced is quite common although when first encountered, it is enough to send you into orbit as you have just experienced. All you need to do is contact your mortgage company and tell them you will be sending them (and copying the credit reporting agency) with a copy of your Chapter 13 filing showing the mortgage company included and a copy of all payments made to the Trustee for the "past due" mortgage payments. The mortgage company is only reporting exactly what is happening on their end - they are just not receiving payments from you or anyone on your behalf to credit to your account. You will get it straightened out but right now it is maddening. It is typical with a Chapter 13 at the beginning for any accounts that you have that may not have been deliquent prior to filing; until the Chapter 13 information starts to get listed on the credit reports as things are reported by your creditors you will have items showing 90+ days late, etc. Since you have backup as to your situation and your payments, with prior informatoin from your attorney/trustee for your broker he should be able to work with a prospective lender with no trouble for a refinancing.

[FeelingHopeless]

I can't add much to whatever one else has offered except to tell you that they're right on the money. It's so common it's discouraging. Our CU continued to add late payments and interest to our vehicle account ... even though we'd been in Chapter 13 for over a year. Our lawyer sent them letters ... which they ignored ... and eventually he told me not to worry about it because it would all be cleared up once we were discharged. Ahem ... but that's another story.

My point is ... our Chapter 13 is discharged and now we're going to take the steps of cleaning up our credit report ... disputing what's incorrect ... and there's quite a bit to correct. It's discouraging ... but it's common. Work with your attorney ... and maybe you can nip some of this in the bud before it becomes a big problem.