The statute of limitations is quite the kettle of fish for companies in the accounts receivable management industry. Determining which particular statute of limitations from which state applies is usually about as straightforward as getting through a maze. When it comes to furnishing information to a credit reporting agency, it gets even more complicated.
That’s why it’s no surprise that there are a lot of questions about trying to understand when the clock starts running on a statute of limitations. It can be very difficult to report a debt as delinquent or charged off if you don’t know from when to start counting. Inquiring as to if the statute of limitations starts running on the date that the last voluntary payment was made by an individual is one of the questions posed in this week’s episode of “Ask The Credit Reporting Expert.” Rick Perr, chair of the Consumer Financial Services Practice Group at Kaufman, Dolowich & Voluck answers that question and two others in this episode.
“If you’re dealing with under the Fair Credit Reporting Act of how long something can be on your report, and 1681c, and you’re looking at that definition, you really need to be careful,” Perr said. “You really need to look at the whole situation to determine what the date of first delinquency is, because it isn’t necessarily the last payment made.”
Perr also tackles how furnishers should handle accounts when they are either paid in full or settled in full, and how credit repair organizations are allegedly instructing consumers about using disputes and threats to have negative items removed from their credit reports.
“You’re always going to have a push and pull, particularly amongst collection agencies who are our data furnishers,” Perr said. “The data furnisher is not the consumer reporting agency. And for good or for bad, I tell my clients a lot when they’re faced with making some of these decisions, yes, they do have a vested interest as a collective society, in making sure that there’s accuracy in consumer reports. And yes, you enter into contracts that have certain contractual obligations that you have to follow. But at the same time, the sanctity in its entirety of the reporting process, for good or for bad, is not 100% in my clients’ interests.”