Account in Collection removed after filing

[QuinnReilly]

Hello all,

My attorney filed my Chapter 13 paperwork on Friday, November 12th. Meeting with the Trustee is scheduled for December 8th. I will be in a 100% repayment plan. I received an email today from Credit Karma that the bankruptcy was reported and my score actually went up. I clicked on details and noticed that one of my creditors removed the Collection designation. The original creditor was Citi but they sold it to Midland Credit Management. I've read that Midland is kind of notorious for not being able to prove that they own the debt. Does removing that designation seem normal? I noticied that all of my other balances were reduced to zero. Interestingly, the account that was sent to Collections is not even on my list of closed accounts. This was a high balance - it would be amazing if they didn't confirm - would bring my payment down quite a bit.

[justbroke]

When a bankruptcy is filed, many creditors will just remove all reporting so that they don't get into any trouble. Just because it's not on the credit report does not mean that it is not owed. Collection accounts are interesting because they are treated based on the relationship with the original creditor. In some cases, collectors are just acting as collection agents and the debt is still with the original creditor. In other cases, collectors purchase the debt and become the owners.

Once you file you'll need to look and see what claims are filed. It is going to be about the claims. You can try to object to the claim of Midland, but just because they are "notorious" in other circle, this sounds like fresh debt and was with the original creditor not too long ago. They likely have enough recent statements to show that they own the debt, along with an "assignment of debt" if it was part of a pool.

In a 100% Chapter 13 bankruptcy, the creditors are going to be excited and motivated, to say the least.

[QuinnReilly]

I will definitely keep an eye on the claims. This debt was unpaid for about 2 years before it went to Midland per the advice from a debt settlement company so it will be interesting to see what happens. I can swing the payment if all of them claim but, of course, it would be great if some don't.