Why mortgage and car payments don't show up on credit reports, and how to fix it.

WHY PAYMENTS ON SECURED DEBTS DON'T APPEAR ON POST-BANKRUPTCY CREDIT REPORTS

When you file for bankruptcy, the law says that you have to list all of your debts, even if you are going to keep paying them.  When you list a creditor in bankruptcy, they get a letter or email notifying them of the bankruptcy.  After they get this letter, the creditors report to the credit bureau that the loan was "included in bankruptcy."  See this article about what credit reports should say after bankruptcy for more (clickable link).  Creditors are allowed to do this even if you keep paying the loan because technically it only says "included," not "discharged" in bankruptcy.  Congress says that all debts must be included in bankruptcy, even if they survive the bankruptcy.  The lenders also stop reporting the payments on that loan even though you are still making them.

This doesn't seem fair, does it?  Perhaps you filed bankruptcy so that you could keep up on your house or car payments.  You have been trying to build a new credit history by making those payments on time every month, but they don't even show up on the credit report!  You know, however, that the lender is getting the payments and crediting them to your account because they send you bills every month, and they haven't started foreclosure or repossession, so why isn't the information on the credit report correct?  I don't know, but my suspicion is that creditors don't report the payments so that your credit does not recover as quickly as it should.

HOW TO MAKE CREDIT BUREAUS REPORT YOUR PAYMENTS

Luckily there is something you can do that will force the lenders and credit bureaus to give you credit for all of your post-bankruptcy payments.  You can request a payment history from the lender (the mortgage company or car finance company), and use it to dispute the incorrect entries.  Lenders are required by law to give you a payment history once per year if you request it.  To get the payment history, just call the customer service number and request a payment history.

Take this payment history and use it to dispute the missing payments on the loan.  Each of the three credit reporting agencies has a dispute process that is fairly easy.  The best way to do this is to go to www.annualcreditreport.com.  That website allows you to both request credit reports and dipsute inaccuracies.  Make sure that you attach the payment history when you make the dispute.  Since there are 3 credit reporting agencies, you should dispute it with each of them.  You may have to do this once per year, because the lender may not start reporting the payments even after you successfully dispute it with the credit bureaus.

WHAT IF I REAFFIRMED THE DEBT?

A reaffirmation agreement is a contract that takes a certain debt outside of bankruptcy.  See this article for more information on reaffirmation agreements (clickable link).  If you sign a reaffirmation agreement with a secured creditor, then they will usually report your payments to the credit bureaus after the bankruptcy.  This is usually a good idea for first mortgages, but not necessarily a good idea for second mortgages and car loans.  For more details on reaffirmation agreements, and when they are in your best interests, please read the article on reaffirmation agreements.

RELATED ARTICLES

1. What should my credit report say after filing for bankruptcy? (clickable link).

2.  What is a reaffirmation agreement? (clickable link).

 

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