Cleaning up reports and score dropped!

[katztoo]

We were just recently discharged and I am starting to correct errors on our credit reports. Citi had reported a balance of 2400 and late and I disputed it. They corrected the error and I rechecked my score and it went from 635 to 601! Reason for low score given is lack of available credit! I should have just left it alone, but I thought it would help my score.

Question: We did not reaffirm our mortgage but were paying outside the plan. I was 10 days late in April and that is reported on our reports as a late payment. Should they be reporting anything at all since we did not reaffirm? It is discharged though we plan to keep the house and keep making payments. (we have 30K equity so we would never want to walk away from it)?Not sure if I should dispute this on reports also. Our mortgage is with BOA

[Logan]

We were just recently discharged and I am starting to correct errors on our credit reports. Citi had reported a balance of 2400 and late and I disputed it. They corrected the error and I rechecked my score and it went from 635 to 601! Reason for low score given is lack of available credit! I should have just left it alone, but I thought it would help my score.

Question: We did not reaffirm our mortgage but were paying outside the plan. I was 10 days late in April and that is reported on our reports as a late payment. Should they be reporting anything at all since we did not reaffirm? It is discharged though we plan to keep the house and keep making payments. (we have 30K equity so we would never want to walk away from it)?Not sure if I should dispute this on reports also. Our mortgage is with BOA

A payment is not late on a credit report until it is at least 30 days late. I know you know 10 days late is less than 30 days so you need to dispute that.
Logan

[malf1204]

No the mortgage was discharged so they cannot report negatives on a discharged account. They can update it to $0 balance discharged in BK and that is it. Reporting lates after discharge is a violation of the permanent injunction.

[TBA]

as for your score dropping, dont panic. it happens. Once you get everything cleaned up, you should start replacing old bad with good new. Apply for a secured card and use it once a month and pay it off each month.

After a few more months (read 6-12), apply for a nonsecured card, and see how it turns out. If you are denied, they usually recommend another secured card - that will then be your decision if you want to wait another few months and apply for unsecured or go ahead with another secured card.

I assume you are not applying for anything right now, so dont worry about that dreaded number. When the big purchases approach, then start to focus on things you can do (like paying down revolving balances, etc).

[katztoo]

A payment is not late on a credit report until it is at least 30 days late. I know you know 10 days late is less than 30 days so you need to dispute that.
Logan

It is due on the 1st and I paid on the 25th (10 days after the grace period). I usually pay on the 15th.

[katztoo]

as for your score dropping, dont panic. it happens. Once you get everything cleaned up, you should start replacing old bad with good new. Apply for a secured card and use it once a month and pay it off each month.

I was trying to clean things up to get a credit card. We are planning a trip in May and will need to rent a car. From what I have read they do a credit check if you use a debit card and that's not good!

[LadyInTheRed]

Question: We did not reaffirm our mortgage but were paying outside the plan. I was 10 days late in April and that is reported on our reports as a late payment. Should they be reporting anything at all since we did not reaffirm? It is discharged though we plan to keep the house and keep making payments. (we have 30K equity so we would never want to walk away from it)?Not sure if I should dispute this on reports also. Our mortgage is with BOA

No the mortgage was discharged so they cannot report negatives on a discharged account. They can update it to $0 balance discharged in BK and that is it. Reporting lates after discharge is a violation of the permanent injunction.

A mortgage is NOT discharged in Chap 13 unless you surrender the property or it is a junior mortgage (2nd, 3rd, etc.) that was stripped.

But, it sounds like the mortgage company reported the late payment during the Chap 13 in which case it is probably a violation the automatic stay (assuming the stay wasn't lifted).

[LadyInTheRed]

I was trying to clean things up to get a credit card. We are planning a trip in May and will need to rent a car. From what I have read they do a credit check if you use a debit card and that's not good!

If you have income, I bet you can get a credit card with your credit rating. If not an unsecured card, you can get a secured card. If you don't get a credit card, call the office where you will rent the car and find out what they will require if you don't have a credit card. If they run a credit check, maybe you can get them to run the credit check before you get there so there are no surprises. Enterprise is one company that will rent with a debit card.

[Logan]

It is due on the 1st and I paid on the 25th (10 days after the grace period). I usually pay on the 15th.

A credit report shows 30 days late not 25 days late. You can be 29 days late on your credit cards every statement and it would never show up on your credit report.

[katztoo]

I guess I'm confused about the mortgage. We did not reaffirm but have been making all the payments outside the plan. My understanding is that because of this we can walk away at any time now and owe nothing (though we don't plan to).I thought that because we did not reaffirm that they can't report late payments?

[HHM]

I guess I'm confused about the mortgage. We did not reaffirm but have been making all the payments outside the plan. My understanding is that because of this we can walk away at any time now and owe nothing (though we don't plan to).I thought that because we did not reaffirm that they can't report late payments?

Hate to break it to you, but not true. Not in chapter 13 bankruptcy. As already pointed out, if you file chapter 13 bankruptcy, and retain the home through the bankruptcy and receive your discharge, you do NOT discharge the mortgage. If you later walk away from the house after the chapter 13 BK is over, and there is a deficiency, you are stuck with it.