| Thursday, March 29, 2001 - 06:23 am |
Hi.. Sorry I didn't find this forum 3 years ago, but hopefully some of you wise sages can offer some advice.
I entered CCCS about 3.5 years ago (with a different company, called Family Debt Arbitration). At the time, I had gone through a breakup and was left with over $50,000 in debt on a $60,000 income.
In hindsight, yes, I should have probably filed Ch7, but at that time (late 20's early 30's I thought that would have totally eliminated any credit chances I would have had in the future). So I did what I thought was right at the time, and entered CCCS. I have now paid off all my bills except for one revolving account of $11,000. Given my payments of $800 per month, and a more comfortable income now, I expect to knock that one off by the beginning of 2002.
Now for the tricky part... I learned last year just exactly *what* CCCS has done to my credit report. (Up until now, I've been a cash-only person, so credit scoring hasn't been a top priority).
While most of the paid-off accounts show "positive" status... there's still the "scarlet letter" of the CCCS notations on a number of the accounts. Ironically, this last $11,000 revolving account that I'm paying shows only positive information.
What should my approach be? Should I write letters to the CRA's telling them I have paid the accounts off.. and that I'm no longer "paying under CCCS" or "Paying under patial payment agreement," etc? The balances are $0.. so it seems to me they should no longer be showing this notation.
Also, (and sorry for being so long-winded), any wise advice in general for someone who has gone the CCCS route and lived to tell about it would be greatly appreciated.
| Thursday, March 29, 2001 - 09:04 am |
This is odd, I thought they say the notation goes away once an account is paid?
I would ask the CCCS about this.
Are you now paying a monthly fee to the CCCS for that ONE payment?
Are the TERMS of that account going to change if you quit the CCCS?
Will that account stay OPEN after you pay it?
I would try to quit the CCCS and dispute those notations.
Please keep us posted.
| Thursday, March 29, 2001 - 10:28 am |
1) Thanks, I'll ask the CCCS and keep you posted.
2) Yes, a fee is still being charged by the CCCS.. not huge (well, not compared to interest).. I think $18 out of an $800 payment.
3) I would have to ask the original creditor about the TERMS of the account, should I decide to quit CCCS. I would think that they would send me back to the original interest rate? Could I ask if they would then report the account differently?
I might also add that my interest rate on this account has been substantially lowered (to 6% from 18%). Not sure if a low interest rate beats being out of CCCS or not.. maybe you can advise?
4) If I'm going to dispute the outstanding CCCS notations, what might I say? After all, it is true that I paid the accounts under a CCCS agreement, but I'm done - so I'd like to get rid of them if possible.
| Thursday, March 29, 2001 - 12:18 pm |
I would think that the creditors don't know WHEN you're done with the CCCS since they don't get any more payments.
Those paid accounts certainly are NO LONGER in the CCCS program.
What is the EXACT notation?
You definitely want to keep the low rate, but it can't hurt to ask them if they wouldn't extend those terms to you directly.
Since THAT account is not reporting the CCCS notation, it doesn't really matter. Except that I hate to see the CCCS get your money.
| Thursday, March 29, 2001 - 12:45 pm |
Thanks for all this attention Christine.
You're absolutely right. The creditors don't know when I'm done with CCCS... all they know is that I'm done with THEM. I guess (out of spite?) they could just keep reporting me as having paid as part of a credit counsel service.
The EXACT notation is: "Account payments managed by credit counsel service"
All of the accounts that make this statement use the same language (strange?). Only Citibank uses different language... "Paying under partial payment agreement"
So I suppose my letter to the CRA's would include my $0 balance statement and the request to take the notation off... since I am no longer "managed by credit counsel" or "making partial payments?"
Does this sound like the most effective tactic?
BTW, this site is great.
| Thursday, March 29, 2001 - 06:30 pm |
Now, don't they already report a 0 balance?
If yes, the "Account payments managed by credit counsel service" notation could be interpreted as pertaining to the previous payments.
I guess the best thing is to try it.
IF you have day time hours in a private office with a speaker phone, you CAN initiate disputes over the phone and I've seen reports updated in 3 to 5 business days.
| Thursday, March 29, 2001 - 07:38 pm |
First I would like to make a small distinction. CCCS is a trademark for Consumer Credit Counseling Service, and not an overall generic term for credit counseling or debt management programs. I think the distinction is important due to the wide readership of internet message boards.
Doug, I work for an Internet Based Credit Counseling/Debt Management service. The notations on your credit report are entered by the creditor as a way of discouraging lenders and card issuers from opening new unsecured accounts for you while you are enrolled. When a creditor enrolled in the program offers interest rate reductions, fee eliminations, etc as a benefit, they generally do not want to see the debtor opening new accounts with creditors not on the program and paying normal fees and interest rates. I suppose it is sort of a "jealousy" type of mentality...If I can't get mine, I don't want anyone else to either.
Disenrolling from the program can very possible lead your creditors to terminate your benefits and reinstate the terms of your original agreement. The original agreement is actually still valid, as any agreement to offer lower payments and interest rates is nothing more than a "handshake agreement" between the creditor and the credit counseling agency. I have seen enrollees leave the program and the creditor reinstate the terms of the agreement retroactive to the enrollment date, this is rare but does occur.
You can try to arrange terms with the creditor directly, but may not be very successful. Creditors look at these accounts as "losses" already as loss of fees and interest rate reductions are costly when you mulitply them by the hundreds of thousands.
Most enrollees on these programs (and this is not necessarily referring to you) already have a spotty payment history and many of the accounts are nearing charge off. It is cheaper for the creditor in the long run to offer reductions on the account terms than collect themselves. The credit counseling agency acts as a collection tool for the creditor.
The creditors are usually very cooperative about updating the credit report entries to paid in full and removing the notation about the credit counseling if you request it. In some cases it is not done automatically, in others it is. I would try this first.
I have seen many cases in which enrollees actually were offered the opportunity to reopen their accounts after the plan was completed.
If your payment history has been timely and consistent, and you decide to finish and are willing to do a little bit of follow up with the creditors directly regarding your report; you may not be in as bad a shape as you believe.
| Friday, March 30, 2001 - 05:53 am |
Thanks Hal... that's what I had always hoped. I always expected my credit report to be (at the very least) "bad" during the time I've been enrolled in "purgatory."
And yes, I am aware of the distinction between CCCS and other counseling programs. I just used CCCS since it seems to be the common reference for "that type of program." Quite frankly, my program has been very good in most ways. But I may be an unusual case.
But, since enrolling, I've never missed any payments and made tremendous progress in eliminating my debt over the past 3 years... and hoped to finish the program and be "reformed" so to speak. I always (maybe erroneously) figured that creditors would be happy to see that behaviour. Here's my next question, if you can all stand another one...
Once I'm finished with the program, I will have zero debt. Nada. Nichts. No car payment. No mortgage, etc. I have a reasonably comfortable income (100k+) and no derogatories (well, save for being enrolled in debt counseling) for the past 4 years. I will have 3 open and current lines of credit (two store cards and one secured credit card).
I will have assets (mostly company stock, plus some savings and a 401K) in excess of 300K.
I would like to attempt getting a car... maybe a mortgage (without paying 12% interest, if possible). Do I have a snowball's chance in hell?
I've been car-less (I live in an urban area) and "cash-only" for the last 4 years... and I feel like I've been on a desert island or something, but maybe you can give me some insight on what I might expect as I try to get financing for a home or car?
| Wednesday, August 22, 2001 - 10:46 am |
I'm sorry I missed Doug's last post, this was a very busy board.
Since I'm linking from the new credit counseling page, I'll answer best I can:
Once ALL the credit counseling notations are removed, getting a car loan or mortgage should not be a problem. Unless we're talking FHA, mortgages require good credit scores. The scores depend on how long these open accounts have been established, etc.
I'd like to hear from Doug and others how it worked out for them -- please post in the NEW Forum.
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