Bankruptcy Credit Reporting Mortgage
Letter to “Ask Leon”
We filed bankruptcy (TX) and it has gone thought the court. We did not reaffirm our mortgage but have always been on time. Our mortgage company will not report this to the credit bureau. They are reporting that we have not made a payment since Nov 2005 and that our mortgage was charged off. The mortgage company claims that they cannot report our account activity to the credit agency unless we sign a reaffirmation. We have auto loans that were not reaffirmed and are being reported as current and never late. We are trying to determine if this is just the mortgage company’s policy not to report our account information without a reaffirmation or is this due to the bankruptcy laws?
I am assuming that you filed before the law changed on 10/17/05. If so, the law did not require you to reaffirm. This is just a quirk of the particular loan company. I recommend that you start shopping to possibly refinance the loan, unless the interest rate that you now have is very much lower than what you could get on a refinance. If you refinance, your new lender will report the payments and you will gain the good credit reputation which goes along with making your loan payments timely. If you go to refinance, you may encounter a difficulty. The new lender will need a letter from the old lender that gives an itemized loan payment history, (so that they can see that you pay on time, contrary to what the credit report says) since the credit report is wrong. I am sure they will give you the letter, when the time comes. As an alternative, you could sue the credit bureau and the old lender for failing to accurately report the loan, because saying that it is unpaid since 11/05 is incorrect and they have refused to correct it. However, I think this is an expensive remedy, and will likely be drawn out and costly-probably not worth pursuing.