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I have also posted this message on the Consumer Credit/Credit Cards board...

This is a long story but I will try to be brief. I would appreciate any and all input/advice.

In 1998 I received a civil summons from Household Credit with whom I'd had an account since 1990 and which, obviously had become quite deliquent. The amount was for approximately $2500 including court costs. Because Household had repeatedly failed to comply with payment arrangements they made with me by noting my payments were late when they were not (I often made payments by phone to insure that they were not late) and charging me late and over the limit fees, my attorney filed a very detailed answer disputing the amount. A copy was sent to the lawyers representing HCS and filed with my county's court.

We planned to prepare a settlement offer once we received a reply from HCS but we never heard another word from them. I wasn't trying to get out of paying the debt; I just wanted the erroneous charges removed. I even went to the courthouse several months later to check the file and nothing had been added. So, I tried writing to them on my own to get the ball rolling and the letter I got back in June 1999 stated "At this time, we are unable to supply you with the documents you requested. Should they become available we will be glad to forward them to you."

The account shows as a charge off on my credit report. I'm not sure how to tell what the charge off date is, but the year under the "Date Reported" category says 1997.

The reason why I'm thinking again of doing something about this account 3 years later is because my fiance and I would like to buy a house in the next year or two, and it is my understanding that all negative items on the credit report should be cleared up before pre-qualifying for a mortgage. So, my questions are...

1) Is my assumption about obtaining a mortgage correct?

2) How do I begin to take care of this situation with HCS when they say they cannot supply me with any information?

Thanks in advance for any suggestions!
Laura
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Laura, you hired an "attorney [to] file a very detailed answer" detailing this 'n that, and you "even went to the courthouse several months later to check the file," etc. I tell folks in my credit repair workshop that if half their effort went into PAYING the bills as goes into undoing the damage afterward ... well, you get the idea.

Here's what you do. Go to a local branch of Household Credit and pay the account in full, extra charges and all. (Maybe, if you're real pleasant and not belligerant at all, someone there will remove some of the charges. Maybe not, but it never hurts to ask.) About two months after it's paid, dispute that derogatory trade line at the CRA level as "not my account; please delete." Because it will then be a zero balance, the chances are slim that the now paid item will be verified, and the item will be removed from your credit report. Be sure to keep evidence of your payment for just about forever.

I know this is not the answer you want, but the value to you in having the item removed so as to improve your FICO score is far more tangible than the effort you've expended so far to get any excess charges waived.

Catherine Coy
Mortgage Broker
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I really appreciate your advice. I hope you won't mind another question or two.

There doesn't appear to be a local branch of Household Credit. There are listings for Household Finance however (the account was a Visa). Assuming Household Finance is not who I should talk to, would you recommend writing to the office in California with which I had always corresponded before? Is there any particular language I should use?

Again, thanks for your suggestions, Ms. Coy. This is the only blight on my credit report (I've checked with two credit bureaus, the third is on its way) so I will do whatever I can to fix my mess.

Laura
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This is the only blight on my credit report ...

I know, dear. This is one of the inherent inequities in the credit reporting/scoring system. Whether you have one collection account or ten, whether it's for $100 or $1,000, whether it's for a past cable bill or the notoriously delayed medical co-pays that drive us all crazy, you still get a Score Factor Code #22--"serious delinquency, derogatory public record or collection agency filing." Bam!--an immediate 100 point (or so) hit to your scores.

I would take care of this in person, if you can, at some regional--not just a store front--Household Credit office, if you can find one. When you encounter someone there who says, to whatever you ask of them, "Oh, we can't do this" ... or "we can't do that," say, "yes, I understand why you can't do that, but if you could do that, who would I talk to?" ... all the while thanking them for supporting you in taking care of this matter. Why, you're just so grateful for anything they can do for you!

If ever there was a time to use your charm, this is it. May save you some money.

Oh, and resolve in the future not to use sub-prime lending sources such as Household Credit. :-)

Catherine Coy
Mortgage Broker
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