30 Days? Yah, Right!

Well, as of October 24, 2005, I had been monitoring my credit for over 30 days with no apparent corrections or changes to the Sherman/LVNV account. At this point, I decided to write another dispute to the credit bureau, figuring that my dispute fell on deaf ears.

Up ‘til now I’d been conducting more online research on credit reporting and was armed with a bit more information. I found out that although the Sherman/LVNV account appeared as a duplicate, that it was the WAY that they were reporting that was causing it to appear as a duplicate.

For one, they were reporting a pay history, and reported me 120 days late in March and April of 2003. For another, they were reporting that the account was currently “Open”, and they had reaged the date of last activity to 08/1999, instead of 07/1999. And lastly, they were reporting their account as a “Factoring Company Account”, and a LOAN to boot. Their account was also appearing as an "OTHER" account on my credit report (as opposed to being located in the collections section of my credit report) and the balance was counted against my available credit balance, which was DEFINITELY not right.



So, I figured another dispute to pinpoint specific problems with the account would be in order. I logged online to www.equifax.com and submitted an online dispute. Among my disputes, I included the fact that the account should be reporting as CLOSED, that the date of last activity should be reporting as 7/1999, and that these guy were NOT a factoring company, they were junk debt buyers. I hit the send button on my dispute and wait some more...

The Subterfuge Starts

After being bombarded by all of the horror stories of fellow consumers' dealings with the debt collection industry, it really didn't surprise me when I received my first letter in response to my complaints - not from Sherman, LVNV or Equifax, but from another company entirely.

The letter was from a Desimber Wattleton with Resurgent Capital Services and read as follows:

"This is a response to your correspondence dated October 14, 2005 regarding the above referenced account. Resurgent Capital Services is now servicing this account for its current owner, LVNV Funding, LLC. By signing a contract with Providian, you agreed to the terms and conditions allowing Providian to report your account history. At some point this account became delinquent and was subsequently charged off and sold to LVNV Funding, LLC (formerly Sherman Acquisition, LP). As current owner of the account, LVNV Funding, LLC has a right to report. This is not a duplicate tradeline or reporting error; this is how credit history is established, maintained, and scored."

"In most cases, creditors charge off accounts once they are 120 days or more past due/delinquent. The statement "120 days past due" is generally how a charged off account is defined by the credit bureaus. Due to the account being charged off, the bureaus still report it as 120 days past due even if it is paid. LVNV Funding, LLC does not report accounts as 120 days past due. This comment is added by the bureaus to further define the account; therefore, LVNV Funding, LLC cannot alter this statement on your credit report."

This is a perfect example of the classic finger-pointing scheme: LVNV points the finger at Equifax and tells me that the credit bureaus are responsible for the reporting. Now to really perfect the scheme, we need the other half - you guessed it - a letter from Equifax blaming LVNV, which we'll get to shortly. But first, let's get a little more in depth on exactly HOW and WHY an account appears on your report...

To be continued...

Dealing with Equifax and Setting the Sherman Family Straight

Upon discovering the Sherman account on my credit report, I immediately wrote a letter to the credit bureau disputing the account. There was NO WAY that I was going to live with come company reporting an open account that was currently in default – I had worked too damn hard over the last few years to pay my bills on time and I was not going to let someone place something negative on my report that was not accurate.

I my dispute letter, I told Equifax that the account appeared to be a duplicate reporting of the original creditor’s account, as Providian (the credit card issuer) was still reporting a charge-off dating back to 1999. I put my letter in an envelope, sealed it, stamped it and placed it in the mailbox. I asked myself, "Now what do I do?"

I’ll tell you what I did…I got on the Internet again and started looking up anything and everything I could find on Sherman Acquisitions and LVNV Funding. I got some fabulous search results and spent hours combing through a wonderful website called ArtofCredit.com. Sadly, AOC.com is no more, but the information contributed by forum members lit a spark of indignation within me. Not only was I able to commiserate with people that were having the same problems, but I also found the answers I needed within their discussions about the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, and the Texas Finance code.

I was immersed in federal law statutes, federal caselaw, news articles about debt collection practices, and scores of consumers just like myself that were trying to figure out exactly WHAT was going on with their credit report. I reached a point where the rumors about Sherman and LVNV prodded me to write another letter telling them EXACTLY what they were reporting incorrectly: an "Open" account, 120+days past due, and the fact that they were classifying themselves as a factoring company. Just in case a newbie is reading this – a factoring company is a company that purchases open accounts receivable from a company at a small discount. This gives the selling company fast cash and the factoring company the right to collect the full balance and make a small profit. The key to the factoring business is that the factor purchases CURRENT accounts with the expectation of getting paid promptly from the invoicee – and that is NOT what Sherman and LVNV did with my account.

My particular account was charged-off in 1999 by Providian and then sold after the charge-off to a debt purchaser called OSI Gulf State for a small fraction of the value. Apparently OSI held onto the account for a few years and then sold it again, to Sherman Acquisitions, who in turn held onto it for a few years themselves. Upon the formation of LVNV Funding (a "Sherman Family Company"), the ownership was transferred to the new entity. These post-charge-off owners are NOT factoring companies (with all of the inherent legal remedies that come with the purchase of a "good" debt) – they are what’s called Junk Debt Buyers, or JDB’s. The fact that they were reporting as a "Factoring Company" on my credit report gave them the appearance of an "innocent" purchaser and creditor, instead of the collection agency that they were.

Add all of this to the fact that they were not reporting at all like the other collection agencies that were appearing on my report, and you can imagine my righteous indignation.

I waited anxiously for a response confirming that they would correct or delete their account on my credit report.

To be continued...

A Dark Day...

Well, it all started out on September 22, 2005, when I pulled up my 3 credit reports from Suze Orman's FICO Kit at http://www.myfico.com/ . Upon reviewing my reports, I knew I was in WAY over my head! There were accounts that I didn't recognize and accounts that I knew were wrong, and personal information that was completely off-track.

The nice thing about Suze's package is that her online software will walk you through disputing any information on your report. Well, needless to say, I had quite a few disputes - one of which happened to be for a company listed on my report as LVNVFUNDG. The funny thing about it was that it appeared under the regular accounts section of my Equifax report (along with all of my currently revolving accounts) as an "Open" account that was 120+ days past due, and NOT in the collection accounts section.

So, I'm thinking to myself....this has got to be wrong (right?)....so I do a little investigation and come up with a sensible answer. This LVNVFUNDG is obviously making some sort of mistake in their reporting. Their reported "Credit Limit" matched a charged-off credit card balance dating back to a card from 1999. However, I never opened an account with LVNVFUNDG directly and the original creditor still appeared on my report. So, I figured they were just reporting the account as a current derogatory by mistake.

I took it upon myself to notify Equifax of their error via a letter [show 9/22 dispute letter] dated the same day, specifically stating that the LVNVFUNDG account must be a duplicate (since the original creditor still appeared). I have 30 days of waiting for my dispute results, so in the meantime I do a little investigating about this account holder and discover their name was really LVNV Funding LLC out of Houston, Texas and they were tied in some way to Sherman Acquisitions, LP. This was confirmed by pulling an online copy of my credit report directly from Equifax's website. This report showed a lot more detail and listed specific contact information for the data furnisher. Funny thing was that LVNV Funding was showing up as the account holder in the Summary [insert pg 3 from 10/13 rpt], but back where the account detail was it showed up as a Sherman Acquisition, LP account.....hmmmmm.

Being the detail-oriented person that I am, I send a letter [show 10/7 letter to Sherman] to Sherman Acquistion dba LVNV Funding (just to cover all the bases) at the Houston, Texas address listed on my report. Within the letter, I dispute the validity of the debt and requested that they either forward validation of the account to my attention, or delete the account off of my credit report. I figure that there's NO WAY this company could be in their right mind by reporting a collection account as something that is currently past due. It's gotta be an error that they will rectify just as soon as I let them know of their mistake. YEAH, RIGHT!

To be continued...