Problem with Date Of First Delinquency

[IBroke]

I'm currently arguing with Capital One Auto when my account is supposed to drop off my report. I still have the original account statements. Here's the problem:

In 2006, my December-Payment was due on 12/2/2006. I missed that payment and therefore, went delinquent on 12/3/2006. The next statement (12/15/06) reflected a past-due amount of 1,438.15. In the following billing-cycle, I failed to make a payment and as a a result, the January statement correctly reflected a past-due amount of 2,876.30. I made a payment on 1/16/07 in the amount of $1,500. This payment, however, was the only payment in that month so my account didn't become current again.

In the following months, I made one payment each. The statements I received actually show that the account was constantly 2 payments past due every time the statement was generated (15th of each month).

Here's the problem: Capital One is claiming a DOFD of 4/2007. I just had a phone-conversation with a lady, explaining the reason:

They are claiming that a DOFD only matters/is valid if you are at least 30 days past due when they are reporting to the bureaus (IMO, that is nonsense). Since my due-date was the 2nd of each month and they were reporting on the last day of each month, I wouldn't have been 30 days past due until April when I actually stopped making payments. So in other words, it doesn't matter that the account went delinquent on 12/3/2006. As long as I was less than 30 days past due when they report to the bureaus, they could ignore the DOFD and simply base the drop off date on my reported payment history. And since I was less than 30 days past due on the reporting date, I was "current" in regards to the reporting and as a result, have to accept their 4/2007 DOFD-date.

What do you guys think? I find this a bit too "creative". Fact is that I went delinquent on 12/3/2006, was 30 days past due on 1/2/2007 and never brought the account back CURRENT. Granted, there were indeed periods where I was less than 30 days past due - but I was never CURRENT again.

So if the DOFD determines the actual drop off date, how can they stick to their claim of 4/2007? If they would report their accounts the day the statement is generated (like the majority of lenders do), I wouldn't have to deal with this issue in the first place - but IMO, the reporting date shouldn't matter in the first place.

Thanks for your input!

[df04527]

That is correct on how it works. I hate Cap One for those very reasons. Anyway getting them to change it sounds like it's going to be a major problem and what i would do is wait and start disputing again in feb or so, then again in mar etc until they delete it. What else can you do really. Suing them over a few months may not be worth it.

I have found, more often than not, on accounts almost ready to drop off they will just go ahead and delete them. You can beat them at their own game. Ha!

[justbroke]

My thoughts on this matter are that you are only past due once 31 days has elapsed since the payment became due. In other words, your 12/2/2006 payment did not become past due until (after) 1/2/2007. This is how credit reporting works. So, youyr first date of delinquency would be 1/2/2007. However, you made a payment and they accepted that payment 1/16/2007 which is the 31st (statement) day and you paid the "30 day past due" amount, so you are now just 0 days past due (because

Remember, the credit report goes by the Statement Date and not the payment date. I think you "cured" the delinquency by paying on 1/16/2007 (31st statement day and before it's technically "past due" on a credit report). Your continued payment, although a slow pay, makes it still just 30-31 days past due (and maybe not necessarily a "credit report" past due payment). (I hope you're following along!)

Current, as far as a credit report is concerned, is whether you are 31 days past due on a payment. It is not whether you have 2 payments outstanding.

So, your DOFD was reset by the 1/16/2007 payment and the continuing payments.

[IBroke]

Remember, the credit report goes by the Statement Date and not the payment date.

Unfortunately, not with Cap. One Auto. They do NOT report the account-status when they generate the statement. They report on the last day of the month. If they would report on the statement-date, I would have received my first "30 day late"-remark with the 1/15/2007-statement - much earlier than April. The account would indeed drop off in January or February 2014 instead of April or May.

So, your DOFD was reset by the 1/16/2007 payment and the continuing payments.

I guess we disagree on that. The statement generated on 1/15/2007 showed a past due balance of $2,876.30 and a total amount due of $4,314.45, due by 2/2/2007. In order to become current again, I would have had to pay $2,876.30 prior to 2/2/2007. However, I only paid $1,500 on 1/16/2007. From there on, I only made a single payment each month. While there were indeed periods where I was less than 30 days past due, I was never current again and each and every statement thereafter showed a past due balance of at least two payments.

I'm fully aware that a creditor is not allowed to report a late payment if you are indeed less than 30 days past due.

I just don't accept that the identical handling of the account would result in two different drop off dates just because Cap. One Auto elected a different reporting-cycle. If they would report the statement-status, everything would be fine.

So my question is: Why can (and should) the way they report influence my DOFD and drop off date since these facts must be determined by information ON the account ITSELF and NOT by the way they are reported?

The FCRA should not depend on the reporting practices of an individual lender - the treatment of an account should be determined by the account itself.

[justbroke]

We disagree on all fronts regarding reporting. I tend to, inconveniently, mingle statement date and credit posting date. There are many lenders that only post on the last day of the month, and not the Statement date. So to the extent that I comingled these dates, I apologize, but I meant reporting date (the date they report to the CRAs.)

As for as the FCRA, it is exactly about reporting. Many lenders can't afford to "run tapes" every day based on varying due dates/statement dates. I have a major bank that reports on the last day, even though my payments are due on the 1st. So it takes another 29-30 days to get my balance reported correctly. But reporting is different than the actual maintenance of the account. I too hate that one of my banks reports that way, but it is what it is.

If there is a gap in the FCRA, someone should probably start an effort to change how "reporting" works, but I have not seen any movement on that front.

[IBroke]

That is correct on how it works. I hate Cap One for those very reasons. Anyway getting them to change it sounds like it's going to be a major problem and what i would do is wait and start disputing again in feb or so, then again in mar etc until they delete it. What else can you do really. Suing them over a few months may not be worth it.

What s**ks is that I want to purchase a new car in January - so I'm a bit under pressure...

[IBroke]

If there is a gap in the FCRA, someone should probably start an effort to change how "reporting" works, but I have not seen any movement on that front.

Yeah, unfortunately, I doubt there will be much movement.

I'm just disappointed that the way the system is set up right now, you can basically get a totally different "treatment" on the exact same account. I wish the guidelines would be clearer. The handling of the account by the debtor should determine the credit-reporting. It just appears a bit strange that one guy would get a spotless credit-report by paying the way I did (constantly late - and often more than 30 days) while the other one gets punished with a monthly "30 day late"-remark each and every month ALTHOUGH he is doing exactly the same.

Funny, though, that I'm in a position now where I'm trying to convince my creditors that I was LATE. A couple of years ago, it was the other way round.

[IBroke]

Hey folks, look what an expert on myfico just posted:

"The FCRA, in sectios 623(a)(5) and 605(c), clearly defines what is commonly called the DOFD as the month and year of the commencement of delinquency on the account that immediately preceded the collection. "Commencement of delinquency" is iclearly defined in the legislatiive history of sections 623(a)(5) and 605(c), interpretations issued by the FTC, and case law, as the date you first became delinquent on the account, and thereafter did not bring the accunt back into good-stianding before the reported charge-off or colllection. You became delinquent ater the billing due date, not the CRA reporting date of delinquency.

In distinction, the date a delinquency becomes reportable as a 30-day late to a CRA is NOT the date that you first became delinquent. The CRA reporting manual clearly defines a reportable 30-late as being 30 days past the billing due date, not the billing date. Thus, one can clearly be delinquent under their account agreement as of the billing due date, but it does not become reportable as a 30-late for credit reporting purposes until 30 past past the billing due date.

They are clearly presenting an inerpretation of DOFD that is directly contrary to all legal definitions.
I would hire an attorney and bring civil action for improper reporting of the DOFD, as defined under section 623(a)(5)."

[justbroke]

IBroke, I think your point of contention is whether you had in fact, were not past due after your payment in January and your subsequent monthly payments. It appears that your creditor reset the delinquency and that on 1/17, you were no longer delinquent.

You could try to get CapOne legal to read the FTC's opinion on this matter. (That opinion is apparently not binding and strictly an opinion.)

So I agree with you that what defines the delinquency date is the question, but how every creditor behaves, at least in my case, has been the antithesis of what the FTC's opinion is. My delinquency date(s), on my pre-bankruptcy cards that I stopped paying, were all 31 days (or the next billing cycle) after my last minimum payment. (What muddies the water further is if it is when the creditor determines it is delinquent, could be the real issue. If you are not delinquent until you are 31 days past due... that could be problematic to having an earlier DOFD.)

My position has been that the creditors are using the date that it's a reportable delinquency. Whether that is how they determine delinquency in the credit agreement, would probably settle that discrepancy.

[IBroke]

My position has been that the creditors are using the date that it's a reportable delinquency. Whether that is how they determine delinquency in the credit agreement, would probably settle that discrepancy.

That is indeed the question.

Let me add, though, that I received (and still have in my files) several "Notices of Default". It says:

"This is notice that you have failed to comply with the terms and conditions of the above referenced account by failing to make payments when they were due."

IMO, this doesn't leave much room when trying to figure out when I'm considered current or delinquent.

Actually, I don't know how I can be considered "current" and in breach of contract due to missing a payment at the same time.

Right now, I'm looking at such a notice, dated 2/27/2007. It lists my "last day to pay" $1,438.15 as 3/14/2007. The payment in March, however, wasn't made prior to 3/22/2007.

BTW, I'm also in possession of a letter, dated 1/10/2007, showing a due date of 12/2/2006, an amount due of $2,876.30 and the notation that the letter would be an attempt to collect a debt. The other notifications, asking for $1,438.15, also show "this is an attempt to collect a debt" - something you usually don't get on current accounts.

[justbroke]

I wish you luck. I think it's a valid claim to get the creditor to correct the DOFD and that you are making a valiant effort to do so, I don't know how far you will get. That FTC letter, if you can get to it, addresses a similar concern but that particular creditor only reported quarterly to the CRAs.

[IBroke]

I wish you luck. I think it's a valid claim to get the creditor to correct the DOFD and that you are making a valiant effort to do so, I don't know how far you will get. That FTC letter, if you can get to it, addresses a similar concern but that particular creditor only reported quarterly to the CRAs.

Thanks!

i'll try my best. Once the shutdown is over, I'll might go ahead and file an FTC-complaint. This might help...