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Question By
Jlkelly01

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Incorrect reporting for a charged off auto loan?
I have a charged off auto loan on my account where the vehicle was repossessed because life happens. I'm confused about how it's being reported and not sure if I should be disputing anything.

The date of first delinquency is 6/2012, date it was closed and reported as a charge off was 12/31/2012. Even though it's a charge off, it's still from what I can tell, being held by the original loan company.

After it was charged off, the monthly payment were still being applied to my past due balance. The car was repossessed and in 6/2014 the balance went down, I'm assuming from the sale of the vehicle.

My first question is that my credit report is showing the last payment was made 6/2014, but I didn't make a payment. Can the proceeds of the vehicle sale be considered payment and would that change the date of first delinquency?

Second question is can monthly payments be applied to a charged off loan? It's increasing my past due amount, which is now significantly higher than the balance.

How should I handle this?

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Any activity even on a charged off loan can continue the date.   The date it was closed is not the final date.   Are they contining to accrue interest on the balance?  You may want to consult with an attorney to see what your options are.   You need to take steps to stop the interest accrual if you can.   There are some protections for you under the Fair Debt Collection Practices Act   You need to take steps to ensure there was compliance.  As an example, several years ago, I was a cosigner on a car note for my daughter.    She wrecked it and ceased making payments.  They came after me.   They claimed they did not auction the vehicle because the damage made the car worthless.   They sold it to themselves for salvage value (and resold the car again later after repair).   The court ruled that as they did not hold the auction and attempt to sell the vehicle they were not in compliance with the law and ruled in my favor and terminated the debt.  You had a right to witness the aution and probably even to participate in the auction itself.

Reply by
Jlkelly01

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They're not only accruing interest on the balance, the balance is increasing because the loan company is also accruing payments every month. My report states that the loan has been closed and that it's a charge off. 

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