Q: I have a problem on my credit report. A few years ago, I leased a car. I made all 39 payments on time.
When I returned the car, I disputed the wear and tear cost. While I was disputing this, the car leasing company sent the charge to a collections agency.
I eventually paid the wear and tear claim, but the company is reporting it as a charge off which makes it look like I didn’t pay on the car and is completely inaccurate.
Do you have any suggestions for me? Their collections manager has already told me twice that there is nothing that can be done.
A: I’m a little confused on the timing. If you paid the wear and tear cost late, then the late payment is the only thing that should be reported. If the dispute went on for a year or more, and the leasing company sold your debt to a collections agency and charged off the wear and tear amount that you failed to pay, then it is a charge off.
You could have handled this better by paying the wear and tear charge on time and then filing a small claims lawsuit against them to help you resolve the dispute. Or, if it was handed over to a collections agency, you could have negotiated at the time of the payment with the collections agency to remove the negative information and simply report the amount as “paid in full.”
However, if you simply disputed this payment and wound up paying it a few months late, what they’re doing now isn’t fair. And, contrary to what you’ve been told, they can do something about it. They just need a little bit of extra motivation.
First, file a complaint with each of the three credit reporting bureaus. If you can prove that you made all of the payments, then they are required by law to investigate and remove errors from your credit history.
Next, you should contact your state’s office of consumer affairs, and your state attorney general’s office and file a complaint against this collections company or car leasing company (or both) for their bad business practices. You can also file a complaint with the Better Business Bureau (bbbonline.org).
I would also contact the regional and national manufacturer of the car that you leased and let them know about the bad business practices of their dealer.
Be sure to inform the company in writing that you are filing complaints against them with all of these companies or state agencies. Don’t forget to attach copies of your letters to the letter you send the company.
It’s unfortunate that you let four years go by before taking action. But doing something now is better than waiting for this erroneous charge to fall off your credit history.
Published: Nov 4, 2006
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