Rapid Reader Questions: Walmart, Apartment, Credit Risk, College

Table of Contents

Q: Does a credit union have to provide a member in writing the amount of interest paid on a loan for tax purposes?

A: Depends on what kind of loan it is. Reporting would be voluntary or required by IRS on certain types of loans.

Q: How can a financial company put a charge off on your credit if you paid the loan in full and received a thank you letter from them with a copy of the contract stamped paid in full?

A: It is either an error, or you might have settled a debt for less than the total amount owed, or you pay the debt after it was charged off. Paying a debt following a default does not change the fact you were in default.

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Q: Does Crescent Bluff Apartment report to credit bureau?

A: Maybe. No creditor is required to report. The best way to check would be to call the leasing office and ask.

Q: What day of the month does Wings Financial report to the credit bureau?

A: That would depend on their arrangement with the credit bureau. Larger creditors dump data daily to the credit bureaus based on the statement date, and smaller creditors report once a month.

Q: What are the pros and cons of the credit score boost offered by credit reporting companies like Experian and others, and can the boosts be reversed?

A: It is a bit of a marketing gimmick since it might boost the credit score you see as a consumer but it might not be factored in or included in individual creditors lending algorithm. Experian says about their Boost solution, “FICO® Scores are developed by Fair Isaac Corporation. The FICO® Score provided by ConsumerInfo.com, Inc., also referred to as Experian Consumer Services (“ECS”), in Experian CreditWorksSM, Credit TrackerSM and/or your free Experian membership (as applicable) is based on FICO® Score 8, unless otherwise noted. Many but not all lenders use FICO® Score 8.

In addition to the FICO® Score 8, we may offer and provide other base or industry-specific FICO® Scores (such as FICO® Auto Scores and FICO® Bankcard Scores). The other FICO® Scores made available are calculated from versions of the base and industry-specific FICO® Score models. There are many different credit scoring models that can give a different assessment of your credit rating and relative risk (risk of default) for the same credit report. Your lender or insurer may use a different FICO® Score than FICO® Score 8 or such other base or industry-specific FICO® Score, or another type of credit score altogether. Just remember that your credit rating is often the same even if the number is not.

For some consumers, however, the credit rating of FICO® Score 8 (or other FICO® Score) could vary from the score used by your lender. The statement that “90% of top lenders use FICO® Scores” is based on a third-party study of all versions of FICO® Scores sold to lenders, including but not limited to scores based on FICO® Score 8. Base FICO® Scores (including the FICO® Score 8) range from 300 to 850. Industry-specific FICO® Scores range from 250-900. Higher scores represent a greater likelihood that you’ll pay back your debts so you are viewed as being a lower credit risk to lenders. A lower FICO® Score indicates to lenders that you may be a higher credit risk.

There are three different major credit reporting agencies — the Experian® credit bureau, TransUnion® and Equifax® — that maintain a record of your credit history known as your credit report. Your FICO® Score is based on the information in your credit report at the time it is requested. Your credit report information can vary from agency to agency because some lenders report your credit history to only one or two of the agencies. So your FICO® Score can vary if the information they have on file for you is different. Since the information in your report can change over time, your FICO® Score may also change.”

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They also say, “Average users who received a boost improved their FICO® Score 8 based on Experian Data by 13 points. Some may not see improved scores or approval odds. Not all lenders use credit information impacted by Experian Boost.”

Q: How is something considered a repossession if the company already had it?

A: If you voluntarily gave the car back to the lender, it is still a repossession. Or if the creditor has the car back and you default on the contract.

Q: I did a voluntary repossession Back in 2020. Why hasn’t it shown up on my credit report yet?

A: The creditor has not reported it.

Q: I had a charge off in 1997. If I open up a bank account today, can they take my money? It’s been 23 years

A: The odds are very slim unless you had some old renewed judgment against you that was still alive, and the creditor was still monitoring it. It only applies in certain states.

Q: Is it better to settle a charge off for less or full amount when looking to refinance your house?

A: Talk to your mortgage broker rather than guessing.

Q: What benefit does Walmart get for filing charge off on a tax report?

A: They meet their required tax reporting obligation to the IRS.

Q: Why is the college asking for tax returns and w2 forms after all documents were submitted?

A: They either want to make sure they have the current information or administrative redundancy. If you already gave it to them and then what’s the issue? Wait till you go for a mortgage, and they ask for a bunch of documents over and over. Get used to it.

Q: Would you pay on a credit card that has been charged off since May 2019?

A: It depends on what the goal is. If you want to improve your credit report and close out an active collection account, then pay it or settle it. Maybe you are trying to stop any future legal action on that account for default. If you don’t care about your credit or potentially beings sued over the debt, then do nothing.

Q: I have a credit card, and every month, there are three withdrawals for interest rates. Why is that?

A: It could be you had active charges, a previous balance transfer, a cash advance, special rate financing, late payment, or another arrangement. It should be itemized on your monthly statement.

Q: What laws are broken as to credit card fraud when a business sends me someone else’s credit card number and expiration date with them not knowing it is a possible mistake on their part, but how many times has it happened in the past?

A: It would be fraud to use the information you should not have. Mistakes should not happen. You might want to notify the company of the error so they can fix it. Without the CVV code and address or zip code, you don’t really have the information you can use.

Q: Should you include charge-off accounts when using debt avalanche or snowball methods?

A: Are you going to pay them?

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Q: Can I apply to college with personal debt in collections?

A: Sure.

Q: How can I find out how much tax I will be charged on a discharged credit union debt?

A: Read IRS Form 982 is Your Friend if You Got a 1099-C.

Q: How long does it take to get the money after credit union approves you on mortgage?

A: That is up to the individual credit union administrative process. Ask.

Q: Is it the more foreclosure the higher the interest rates?

A: Higher interest rates are typically charged based on the borrower’s risk of defaulting or paying late. Multiple foreclosures would probably be viewed as increased risk and lead to higher interest rates being charged.

Q: How long will my paper stimulus check take to clear after depositing into ATM at Chase Bank?

A: Ask your bank about their availability policy for federal government checks. Do they handle it as a local or distance check, and how long until they give you full access to the funds versus provisional credit towards them?

Q: Can the debtor talk to the creditor while in Chapter 13 to try to make a settlement outside Chapter 13?

A: Why? You are paying a bankruptcy attorney to represent you; talk to your attorney. Trying to go around an active bankruptcy case can create all sorts of unintended consequences.

Q: Which business can I create after my retirement?

A: Any business you want.

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Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
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