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Credit After bankruptcy
Over the last few years Collection agencies have started buying "old bankrupt debt" and trying to collect or even obtain judgment or liens on the old debt. It is important to know that this problem is increasing. The Federal Trade Commission located in Washington D.C. encourages you to file a complaint through the link above. The "FTC" cannot resolve individual complaints, however your complaint may help them and the law enforcement partners detect patterns of fraud and abuse, which may lead to investigations and eliminate unfair business practices. There are steps you can take however, see below.
If you have a collection agency trying to collect on an old bankrupt debt.
1. Send a letter to the collection agency advising them when you filed bankruptcy, include a copy of your Schedules / List of Creditors along with a copy of your Discharge papers for proof.
2. Send the letter via Certified mail, so you will have proof that the they received your documents. (most collection agencies do not respond to regular mail)
4. If the Collection Agency is trying to obtain a judgment or lien against you, your property, or garnish wages, file a copy with your local Court House as well.
5. If the Collection Agency has reported the old debt to the Credit Bureaus, send the Three Credit Bureaus (see address below) a copy of the Schedules / List of Creditors and Discharge Documents via Certified Mail also, so they can remove the debt from your file.
Steps to take after your bankruptcy discharges:
The credit bureaus only report the information given to them by your creditors, or by you. It is a misconception that the credit bureaus will automatically clear your debt after your bankruptcy has been discharged. When your creditors are notified that you have filed bankruptcy, they simply quit collecting on the debt, however, most (not all) will never take the time to zero out the balance you owed to them on your credit report. This does not mean that you still owe the debt, it simply means that your credit report reflects incorrect information, that you still owe the debt. This also means that your credit scores never go up until you take the important steps (see below) to clear out the incorrect information on your credit report.
Credit scores are very important, as it not only depends on the interest you are going to be charged for items purchased in the future, it now also depends how much you pay for auto insurance and in some cases, employers are now checking your credit scores prior to offering employment.
1. Write a letter to all three bureaus. Trans Union, Experian, and Equifax. (See addresses below).
TransUnion Consumer Solutions
P.O. Box 2000
Chester, PA 19022-2000
P.O. Box 9530
Allen, TX 75013
P.O. Box 740241
Atlanta, GA 30374
2. In the letter, make sure you date it, and reference it with your personal information such as your Name, Address, Social Security Number, and Date of Birth.
3. In the body of the letter, reference one item at a time that was included in your bankruptcy. Tell the bureaus exactly what to do. Example: reference each account separately, that was included in your bankruptcy and tell them to zero out the balance and past due balance of each account. Do this for each item you included in your bankruptcy and that was listed on your Schedules and Discharge.
4. Be sure you ask for a copy of your revised copy of your credit report after the completion of their investigation.
5. Send the letters via certified mail. The bureaus respond faster and more efficient when you send it via Certified mail.
6. After the bureaus have finished their investigation and you receive your "revised" credit report from all three credit bureaus, go over them to make sure they have corrected each item. If they have failed to do so, there will be a phone number and a file number included in your correspondence you received from each bureau when they sent you your revised credit reports. This file number is only good for 30 days and is the only way you can talk to a "live representative" at the credit bureaus. During this 30 day window, you can call and have them re-investigate the item.
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