Doucet & Associates secured a free house for a client today as a result of a bank’s massive blunder. The bank apparently did not have their paperwork in order and failed to file a foreclosure against our client within the statute of limitations...
The Servicemembers Civil Relief Act (SCRA) protects active duty military personnel and other deployed service members from losing their home and other assets while they are serving active duty, temporarily stationed somewhere else, or permanently relocated...
Figuring out how to pay off your holiday debt or other credit card debt can be a daunting, challenging task. Doucet & Associates Co., L.P.A. has created a list of tips and tricks to help you eliminate your debts, become debt free, and avoid receiving calls from debt collectors...
March is National Credit Education Month and Doucet & Associates would like to invite you to read some of our articles on improving your credit, keeping track of your credit report, and your rights under the Fair Credit Reporting Act...
TransUnion and Equifax are refunding $17.7 million to consumers and paying $5.5 million in fines for giving consumers misleading and deceptive credit scores.
The rise of debit cards, credit cards, and electronic fund transfers allows many Americans to live what appears to be a cashless life today. If America evolved to a cashless society, the speed of consumer and business transactions would continue to increase.
Do You Want to Improve Your Credit Score?
Experian estimated Columbus, Ohio’s average credit score to be 666 in 2015. That is only three points below the 669 national average. If your credit score falls below these averages, there are steps you can take as a consumer to gain some points. The lawyers at Doucet & Associates Co., L.P.A. can also offer advice about the Fair Credit Reporting Act (FCRA) and how to correct problems on your credit report.
Ways to Improve Your Credit Score
1.You should first check your credit report for errors using at least one of the three main credit reporting agencies (Equifax, Experian and TransUnion). Your credit score may differ a little on each report based on resources the agency used to develop your score. If there is an error on your credit report, the FCRA says you can send a letter to the credit reporting agency asking for the error to be corrected. If the credit reporting agency fails to correct the error, you can contact Doucet & Associates Co., L.P.A. for help on correcting your report or read more about the FCRA on our website by clicking here and they may have to pay our fees. Correcting the errors on your credit report can improve your credit score.
2.Get a credit card. Having a credit card shows that a creditor can trust you to pay back borrowed money. If you use the credit card correctly without developing debt, then you can increase your credit score.
3.Pay off your credit card debt. Some people cannot pay off all their debt in one payment. If that is the situation for you, stop using your credit cards and focus on minimizing your debt by making the required minimum payments every month.
4.Pay your bills on time. This includes all bills such as credit card bills, utility bills, medical bills and student bills. Failure to pay bills on time lowers your credit score.
5.Ask for a raise on your credit card limit. Getting a raise does not mean you have to spend more on your credit card, but shows that your creditors trust you more.
6.Get involved in paying off different types of loans, whether it is all at the same time or separately. Your credit score can be improved if you have history of accurately paying off a credit card, an auto loan, student loans and a home mortgage loan. If you encounter problems paying off a home mortgage loan the lawyers at Doucet & Associates Co., L.P.A. have experience helping homeowners secure loan modifications and fighting foreclosure lawsuits.
Mistakenly Charged Off
A bank charging off a person’s bank account is harmful to a consumer credit report. Sometimes charge-offs can mistakenly continue after a consumer has paid off their debt. Troy Doucet, the firm principal at Doucet & Associates Co., L.P.A., shares his legal advice on what a consumer can do to protect their credit report from a false charge off in Help! The Bank Charged Off My Debt – After I Paid It.
A charge-off is when the bank writes off the consumers loan on its accounting financial statements. Usually this action will appear on a credit report as a charge-off and can lower a consumer’s credit score. There are ways to correct a false charge-off appearing on a consumer bank statement and credit report.
A consumer should notify the bank when seeing an invalid charge-off on a bank statement. The consumer should question if money is still owed on a previous debt and the reason for the charge-off if it is disputed. A consumer who discovers a false charge-off on a credit report has the right to correct the problem under the Fair Credit Reporting Act (FCRA).
The FCRA protects consumer right to have an accurate credit report distributed to lenders. A consumer can send a letter to a credit reporting agency such as TransUnion, Equifax, and Experian to request a change in false information. A consumer should provide all documents possible to support why the information is false. A credit reporting agency must then re investigate the credit report and verify with the consumer that the information was corrected. A false charge off on a credit report can substantially affect a consumers ability to receive a loan and low interest rates.
More information about the Fair Credit Reporting Act (FCRA) can be found in 23 Legal Defenses to Foreclosure: How to Beat the Bank by Troy Doucet.
Check out some of our related articles about credit report errors:
Fair Credit Reporting Act
The Fair Credit Reporting Act (FCRA) requires credit reporting agencies to provide accurate information to lenders. The FCRA also creates legal rights for consumers whose information is being investigated and misrepresented by credit reporting agencies such as TransUnion, Experian, and Equifax.
Credit report agencies make money off of lenders who are requesting credit reports to justify loans and interest rates. Credit report agencies are not government funded. Credit reports are often required for loans on larger purchases such as cars and homes mortgages. Credit reporting agencies over report negative credit information to lenders, such as missed payments and debts. Lenders make more money off of people who are deemed a higher credit risk because they can enforce higher interest rates. Therefore, a lender will keep returning to a credit reporting agency who can help provide information that can support higher interest rates.
Consumer Rights Protected by the Fair Credit Reporting Act (FCRA)
A consumer has the right to have an accurate credit report distributed to lenders. A consumer also has the right to challenge credit report agencies who are providing false or inaccurate information. A lender must provide a consumer with the name of the credit reporting agency who allegedly provided inaccurate information on a credit report if requested.
The FCRA also made it illegal for credit reporting agencies to provide subjective information on a credit report such as religion, race, how long you have been committed to your job and details about other people you may live with.
How Can a Consumer Challenge a Credit Reporting Agency Under the FCRA?
A consumer must send a written letter to the credit report agency detailing the inaccurate information provided on the credit report. It is important for the consumer to provide as much documentation as possible to support why the information is inaccurate. Depending on the inaccurate information bank statements, records, and receipts of purchases are good examples of documents to provide.
A credit reporting agency who receives a letter must re investigate in the information being provided on the consumers credit report. Then must reply to the consumer detailing if the information was corrected or not. If a credit reporting agency refuses to fix inaccurate information, the consumer should then seek out a consumer lawyer to help sue the company.
What Type of FCRA Damages Can a Consumer Sue For?
- Actual damages are real losses for the consumer. Regarding the FCRA, a consumer might experience financial loss due to inaccurate information being provided on a credit report. A consumer who receives a higher interest rate on a loan or mortgage can experience economic loss and possibly debt.
- Statutory damages are when the credit reporting agency is providing inaccurate information, but the consumer has not financially been affected yet. The inaccurate information could be preventing the consumer from even acquiring a loan.
- Punitive damages are deliberate wrongdoings by a credit reporting agency. An example of a wrongdoing would be a credit report agency refusing to read a letter from a consumer or refusing to re investigate the information being provided on a credit report. Punitive damages are rare in cases regarding the FCRA.
A credit reporting agency will also be responsible for paying lawyer fees if the consumer wins the case.
Why May There Be Inaccurate Information on a Credit Report?
Mistaken identity is an issue the credit reporting agencies battle. These mistakes are often due to a merged file. Consumers with common last names and the same first names can be confused. False addresses can appear on credit reports from someone with the same name living at a different address. Seniors and Juniors can be commonly confused especially if they live at the same address to.
There are many complaints about credit report agencies. The Federal Trade Commission (FTC) does not have resources and funding to check all the information the credit report agencies are providing to lenders.
How Can a Consumer Check Their Credit Report?
Consumers are able to access their credit report annually from TransUnion, Experian, and Equifax. Most negative information is only listed on a credit report for seven years. Bankruptcy is usually listed for ten years. Also consumers have to give permission to lenders to look at their credit report.
You can find more information about the Fair Credit Reporting Act (FCRA) by reading 23 Legal Defenses to Foreclosure: How to Beat the Bank by Troy Doucet. If in Ohio, call Doucet & Associates Co., L.P.A. at (614) 944-5219 for a consultation.
Social Security Administration Mislabeling People as Dead
60 Minutes released a report a few months ago concerning individuals who were incorrectly reported as dead to the Social Security Administration. The government agency keeps a Death Master File compiled from information submitted by funeral homes, doctors and hospitals, but this information is not always accurate and certainly subject to human error. The social security administration estimates that roughly 9,000 individuals are incorrectly labeled as deceased every year, which can cause serious problems to the people unfortunate enough to be on that list, but not actually deceased.
If you find yourself on the Death Master File, it effectively means that as far as the government is concerned you no longer exist. Your social security number is rendered invalid, and you no longer qualify for Medicare or social security. Government agencies such as the IRS and law enforcement are also affected, meaning that you can be labeled as an identity thief simply for trying to use your own credit cards. In addition to all of this, the Death Master File is used by banks and credit reporting agencies, which means that you may never be able to get another bank account or loan in your life.
According to the 60 Minutes report, one woman was locked out of her bank accounts, which essentially threw her $80,000 balance into limbo and forced her to live in her car for six months, as she was unable to rent an apartment. Attempts to correct this issue are often numerous and fruitless. The same woman attempted to correct an error with just one credit agency, and had to report the same information over twenty times simply to get them to consider correcting the error.
Doucet & Associates regularly works with our clients to correct errors on mortgages and credit reports, and is willing to evaluate your options if you have fallen victim to this bureaucratic error. If you have been incorrectly labeled as deceased by a credit reporting agency, or would like any other credit reporting error rectified, call us at (614) 944-5219. We may be able to help, and may be able to secure compensation or damages if this has happened to you.
If you would like to read the 60 Minutes report referenced, please click the following link:
Can My Credit Card Company Take Money From My Bank Accounts?
The short answer is no, your credit card company cannot take money out of your account without your permission or a judicial order. If you live in Ohio and your credit card company is taking money out of your account without your permission, call our consumer attorneys at (614) 944-5219.
The Electronic Funds Transfers Act (EFTA) in the Consumer Credit Protection Act (CCPA), codified at 15 USC 1693a, et seq., governs electronic fund transfers to and from accounts. It’s a very short Act, with the juicy provisions located towards the end of the chapter.
In particular, 15 USC §§ 1693e requires any preauthorization to be in writing to be valid. So, the credit card company can’t take money from your account unless you allow them to do so in writing. The only exception to this is when you authorize them over the phone for a one time debit to your account, as those transactions fall outside the act under 1693(a)(6)(E).
If you don’t give the credit card company authorization over the phone, then they can’t take your money unless they get your permission in writing (or have a court order). You cannot waive this written requirement, as stated in 1693l. Also, the credit card cannot condition the extension of credit on repayment by electronic transfer, as stated in 1693k.
The civil liability provisions of the act are located in 1963m. It provides for actual damages or up to $1,000, plus attorneys fees in a successful action. Because attorneys fees are provided under the statute, our firm may be able to represent you without out of pocket cost to you. Further, a party knowingly and willfully violating the act is also subject to criminal liability under 1693n.
If an unauthorized transfer occurs, your personal bank cannot hold you liable for amounts greater than $50 or the amount stated in 1693g in certain circumstances.
If you think you need to file a lawsuit about an unauthorized transfer, call us or take a look at the definitions in 1693a to ensure the act applies to all the parties, plus look at the implementing Regulation E, 12 CFR Part 205, et seq., as it implements the EFTA, or call our law firm if you live in Ohio.
The credit card company can take money from a deposit account with court authorization. However, it cannot use a cognovits (admission of liability) to obtain an immediate judgment without your permission. Cognovits are illegal under federal law in consumer transactions, as an unfair credit practice under 16 CFR Part 444.2, meaning creditors must resort to the judicial system set up in each state to enforce debts. That is, the credit card company must normally sue you in court, obtain a judgment, then collect on that judgment through the court system. This can take months to years, depending on whether you defend the lawsuit.
For example, in Franklin County Ohio, amounts over $15,000 are under the common pleas courts jurisdiction. Judges in that court report a case load of about 1,000 cases each due to the high number of foreclosures, meaning it could be over a year before you get a trial date (if you survive the preliminary motions and motion for summary judgment). Small amounts that are able to be litigated in small claims court may generate judgments much faster.
While the court can order a freeze on your bank account at the beginning of the lawsuit, this generally occurs only when the credit card company knows which bank you have assets and there is a likelihood the funds may not be there when the lawsuit is done. It process is rather unusual, and generally the credit card company will need to wait for a judgment before freezing your assets and then taking them. If the account is transferred to a collection agency, then the Fair Debt Collection Practices Act will probably kick in. That is available at 15 USC 1692, et seq. It does not apply to credit card companies collecting on their own debt, unless debt collection is their business. It offers great protections for consumers from harassing phone calls.
If you have limited (or no) assets and lots of debt, it is wise to at least have a conversation with a bankruptcy attorney. They can provide direction or help figuring out how to protect limited assets from creditors through bankruptcy. If you are in school and rely on student loans, it would be very wise to also talk with your financial aid office to determine what, if any, effects bankruptcy will have on your ability to continue in school (stemming from the ability to obtain financing). A Bankruptcy filing can eliminate your ability to qualify for grad-plus loans without a strong co-signor (over the government subsidized $20,500 per year).