FCRA Section 609 “B.S” Letter

FCRA Section 609 “B.S” Letter

You may have heard about this letter using a specific part of the Fair Credit Reporting Act called “Section 609”.

Before I start let me state a few words on my thoughts on this section people try to sell letters on:

  • Scam
  • Bull &%$#
  • Lies
  • Deceptive

Every once in a while I get annoyed enough to roll up the sleeves and start ripping to shreds certain things like Credit Associates & National Debt Relief (Debt Settlement Companies) to name a few.

I do some research then tell everyone reading this what my experience was with it and that experience is now based on 14 years in the credit industry and in the trenches, looking at case law, seeing how credit bureaus response to consumer letters. Those 14 years and allowed me to review over 17,000 credit file and analyze them and diagnose them to see what can be done to put that file in a position to obtain future lenders from a variety of lenders, mortgages, car loan, credit cards etc.

So I was asked about the “magical” Section 609 FCRA letters floating around. Of course everywhere you look practically you have to buy them. I found a site that had a discussion on them and then they started quoting the sections of law which allowed me to look into it.

There were people swearing by the letters and others saying it didn’t work. Of course the ones who swore by them didn’t give any specifics on the account which is the most important part of the story.

They quoted 609(a)(1)9a) to start and one idiot actually said they “vaguely refer to the credit bureaus having to have copies of original contract signed for proof”.

Ugh………………..

People, NO WHERE does it even closely say that let alone refer to that……. I really think that the rumor gets spread, some people post a cheap web site and then sell the letters for $10.00 or so and the get a check in the mail.

A little more research as I read the section before writing this and there was some more B.S from a guy back in 1999 that quoted a different section of Section 609 (c)(2)(E) so I read that and AGAIN……. L I E S !!!

What I love when reading this was it talks about how the guy has copyrighted his letters, while I’m not a lawyer I’m pretty sure you can’t copyright sections of a law that consumers could use. BUT I could be wrong…. But doubt it.

Now this is what I know and understand as I even saw a credit repair company write a blog about it and I’m convinced they are idiots as they talked about and then they discussed “Debt Validation”… that will be the next blog about that which drives me nots so stay tuned!

So these knuckleheads say:

Section (609) of the Fair Credit Reporting Act is a Consumers Disclosure section which is to provide for the protection of consumers against false and erroneous reporting. This section of the FCRA places the burden upon the Credit Bureaus and the Creditor to prove an account is yours. To positively prove an account is yours, the creditor must provide the Credit Bureau a copy of the original creditor’s documentation (whatever you filled out and signed upon opening the account with the reporting creditor)”.

This is literally word for word that I found on several site touting the magic of the 609 letters.

The scary part is people hire bozos like this to help them trusting they have a clue about what they are doing. Further looking at their site they only sell letters to consumer for Do it yourself so “selling” the magic bullet is good for their business.

Totally unethical and they should go to hell because while I don’t know what they are charging the false hope they are dangling is just not cool.

Just reading more of this gets my blood boiling, the term creating a mountain out of a mole hill comes to mind when I read some of the “things” they claim.

I truly think they embellish on things then have some people (companies actually do this) post positive responses which gets you hooked and then say what the heck its only $10.00 (a money example)

Section 609 is rather an easy read and while there is a little bit of legal language in it it’s fairly cut and dry so a consumer with little knowledge should be able to understand majority of it.

UNDERSTAND the credit bureaus are like file cabinets of information on you, you have your folder and all the sub sections within it on all different accounts and the information on those accounts.

The credit bureaus sell our information and we willingly give (most of the time) to lenders in exchange of credit of some sort. They only report what is provided to them that we allow in our lender contracts

It is an automated system which has tons of problems and the law (FCRA) like all laws had to be sponsored and someone had to pay for that and you know a consumer group did not pay for that.

Folks, I understand that when your credit is bad you are looking for that “magic pill” to make all the problems go away…. It doesn’t exist, sorry it just doesn’t.

That is why one of the things I always promise before speaking to someone is I’m going to tell you the truth whether you like the answer or not.

It doesn’t mean I can’t help but you need to be aware of what the situation is and not let someone prey upon you to take your money and make it seem like once you pay them all the problems go away, it doesn’t work like that.

Designing a specific plan for your specific issues can always be done it then becomes a timeline issue for you.

I hope I stopped some of you reading this or thinking of spending your money but more importantly your hope and emotions on a joke of a claim of hope, and a mini news flash for the crazies who maybe tried it and got some things deleted.

Did you ever think that maybe the reporting company didn’t respond to the credit bureaus in the allotted time or cared to respond for company internal reasons and that why the accounts were deleted or it fell past the statute of limitations??

That’s it for this posting, hope it sheds some light on some things and feel free to google the FCRA and read section 609 for yourself, you will then see that all the claims they make are not remotely mentioned in the sections they claim. you cant even create an argument that they do, at least not without a straight face.

 

 

*** Want to learn more about how the credit system works? Buy my book for easy to understand concepts of how credit works and how lenders look at you at you.

Contact me at wayne @ wayne the credit guy.com

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Clean Up Credit Before Finding New Apartment

Clean Up Credit Before Finding New Apartment

Wayne the Credit Guy discusses the impact an eviction can have on your credit report in this article on FoxBusiness.com.

Excerpt:

Credit reports do not show records of evictions. According to Wayne Sanford, president of the credit consulting company New Start Financial, “If you are evicted, then it will show up as a collection as any apartment debt a consumer owes, such as cleaning fees or lease breaking.”

Debt Collector B.S.

Great, funny story that I just got from a client a few minutes ago that not only needs to be shared but also to educate consumers to debt collector scare tactics. She called to tell me she got a call from a process serving company asking for her ex-husband’s name (not hers) and said she wanted to know if she would be home to receive the paper serving. She stated do I sound like a man? The answer was no of course so she asked so why would you ask if I would be home to get served papers for someone else that I have no affiliation with for the last 5 years. The lady replied that’s not my job I just make these calls and ask.

She gets a call later in the day from a man who says he is recording the call and has a bit of an attitude with her on a debt that she said the last time she paid on it was in mid-2009. He states the date of last payment was sometime early 2010. Of course the original fee (turns out the card was hers) was approx. $500 but they were trying to collect approx. $1,300.

During her conversation with him he put her on hold 6 times… this is a delay tactic that crappy debt collectors do to make it seem that they are more important than you and make you wait thus making it seem “more official”.

I trained/educated her like I do all my clients to ask what was the charge off date. He kept repeating that he is recording the call for legal purposes to bring to court all of her false responses and then when she mentioned she had an advisor (me) he quickly got very snippy and said well I hope he is an attorney and you can just tell it to the judge this week and then hung up on her.

I told her that is the telltale sign of a BS debt collector. I advised her to contact the original creditor and talk to their collection department (for true peace of mind) and ask them what was the date of charge off and if they sold the account when did they sell it?

Turns out the account was sold in February 2010 to a collection company and while technically she does owe the debt the threats of a lawsuit were illegal and unable to occur as in Texas as in many other states (but different times for different states) is four years. So the debt collector who was the new owner of the account failed to take advantage of the legal remedy they had thus resorted to this type of tactic.

While the statement is obvious that you should always pay your bills, very rarely does anyone ever get credit of some sort with the intention of not paying them. However life happens and if creditors take advantage of every law out there for them, should consumers not do the same?

Know your rights when the Debt Collector calls

Know your rights when the Debt Collector calls

Dallas Credit Guru Wayne The Credit Guy Talks About Creditor Phone CallsWhile there are some polite and honest debt collection companies doing their job, just know they are the extreme minority. So let’s have some education about what they can or cannot do as they operate mostly under intimidation, manipulation and fear.

Once your account goes to an outside collection agency the account is usually “charged off” which means 180 days of nonpayment has gone by and federal law requires the debt be written off their books. The coding of this account on your credit report cannot get any worse.

This charge off date is what is measured for the seven years the account can stay on your credit report. So the negative account will stay on your credit file for seven years. The OTHER issue to be very concerned about is the legal statute of limitations. This is the timeline you have for the creditor to file a lawsuit against you which will turn into a judgment and if that happens no bank will lend you money with a judgment against you, even with a 810 credit score.

Each state has their own timeline for how long a creditor can sue you. Most states including Texas and California are four years. But some states like Illinois and West Virginia are ten years (never going to move there!). The best way to confirm the date for your state or to ensure the timelines have not been changed is to go to the Secretary of your state’s website to confirm these dates.

So once you have confirmed this information and a debt collector calls you and threatens to sue you understand it is a civil matter only. The sheriff or constable is not coming to your house to arrest you. And if the debt is old enough so you know they can’t sue you once you tell the debt collector that and that they broke the law by saying that knowing they can’t they typically get off the phone with you rather quickly since they now know you are an informed consumer.

Also… debt collectors buy debt from creditors for pennies on the dollar so NEVER pay more than 50% of the debt if you choose to pay the debt. In the past I have gotten collectors to go down as far as 30% for debts only a few years old.

But UNDERSTAND that if the debt is 5-6 years old and you do pay it make sure in the paperwork you get BEFORE you make any type of payment that it says the debt is settled in full. And the account WILL stay on your credit report for another seven years even though it will show a zero balance. It DOES NOT get removed unless you are able to negotiate that as part of the agreement but most debt collectors will not remove it but it can happen.

Renters Beware….The Impact of Collections on your Credit

Renters Beware…. it’s the little things that always get you.

What if i told you the dollar amount of a $50 collection and a $500 collection is the same thing?

NEVER co-sign for someone’s apartment or home… ALWAYS give them 60 days WRITTEN NOTICE, get a copy of the managers signature so you have proof.

They have your SS #, you don’t have theirs. They report to the credit bureaus… you do not. What does that mean??? It means you lose unless you have documented proof!

While there is nothing you cannot do that a credit repair company can do REMEMBER… there is a difference between disputing and getting results.

Having a credit company who understands the underwriting criteria of future lenders and how they look at you is more important than you can possibly realize….

Bad credit, credit repair, repair credit, How to repair credit, fix credit, credit fix, how to fix credit…. No matter how you say it you don’t realize how important credit is until you need something today and then it’s too late.