Credit Card Debt After Divorce
Author: Sherry
Posted: Mon Jul 05, 2004 10:52 am
Post subject: Credit Card Debt After Divorce
4/13/2002 9:05 am CDT
While married, my husband and I financed a car. Shortly afterwards, we were divorced and I was awarded the car and the liability. He remarried and declared bankruptcy and the debt was surrendered to me, the co-debtor. I made payments ahead of time and paid the car off early. I recently received a copy of my credit report and under Ford Credit, it says simply "included in bankruptcy" which has completely destroyed my credit. Bankruptcy court and Ford Credit say they aren't responsible. I've written to all three reporting agencies with copies of supporting documentation and hopefully this will be cleared up, but how could they have done this in the first place?
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Author: Dan
Posted: Mon Jul 05, 2004 10:55 am
Post subject: Credit Card Debt After Divorce
4/13/2002 10:30 am CDT
It must be frustrating to get caught in the middle. "They" are required to be truthful (that's why they respond in some way to our corrective information when we send it), but "they" are not required by law or by regulation or by agreement or even by fear of losing business to sort out all the details of a difficult situation.
And why is that? The credit reporting system was brought up as a response to the long proven fact that deadbeats cost lenders big money. To boil it all down to the bottom line, then, lenders are the customers of credit reporting agencies- the lenders pay and the credit reporting agenices profit from all those payments. "They" all make agreements among themselves that lenders will report every relevant transaction (that may be why your name got included in the report from Ford Credit who lost $$$), and that the credit reporting agencies will faithfully report all that information coming in from the lenders. Notice that we who borrow money and pay it back are not customers of this system. Any gripe we have about the system cannot cause that system any financial loss. They cannot gain us or lose us as customers!
The truthful reporting requirement comes in a small way from ethics ("they" want to do right), but mostly "they" are truthful because laws have been passed that allow us to sue them for wrongful reporting, and regulations have been established in each state with government agencies that can assess penalties and remove their business licenses. It may be that "their" primary motivation to be truthful is to avoid the cost of litigation from us and to avoid the cost of penalties from the government and to avoid being put out of business.
So now you have sent corrective information to each of the three credit reporting agencies (effective), and have also talked to some of the debtors (probably not as effective-they probably care more about the $$$ they lost than anything else). "They" now have reason to make inquiries about, what to them, is new information. To play "their" proper role in the system, "they" double check the new information that you provided, and modify what is reported on your credit reports. What to you is the disgusting stain of a bankruptcy report (hopefully) removed is to "them" nothing more than a simple correction. I don't even think "they" will say "sorry" or even "oh what a shame." I will, though.
And we haven't even talked here about the legal technicalities of your situation. It may be that "they" will not remove you from the stain of that Ford bankruptcy report. This is not me passing judgement! I don't know anything at all about your situation. But if the Ford car loan was transacted in such a manner that you were obligated on that loan (these regulations vary from state to state), and that obligation was NOT removed from you in your divorce decree, then the credit reporting agencies may find reason to faithfully report the facts of the matter even though everybody knows that those facts don't represent the reality- you paid off your car and he did not pay off his car! Wow would that be a drag. But if all this happened they would not lose a lawsuit about it- they reported facts. To cover this unfair situation, then, "they" are required to include in your credit report your prepared "explanation/rebuttal." That is about as far as the fairness goes. Again, sorry.
By the way, do not act on anything I have said here. I am not a lawyer and I don't work in the credit industry.
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Author: Misty
Posted: Mon Jul 05, 2004 10:56 am
Post subject: Credit Card Debt After Divorce
4/13/2002 4:55 pm CDT
The reason they did that is because you were listed as joint on the loan. You may have divorced & were given the car but most institutions don't honor "third party agreements"-like divorce decrees. So this means as far as the court is concerned, you were given the car & the liability but as far as the loan company goes, you're both just as liable as the other-unless they actually removed his name from the loan. I'm not sure how car loans are handled but I work in the credit department for a major credit card company & I know this is our policy. So when your ex filed bankruptcy, he included that account & that's why it's showing on your report. Unfortunately, the only thing you may be able to do is to file a consumer statement w/all 3 of the credit bureaus stating the bankruptcy was individual, but again not too many lenders will consider that. Ford Credit is required to report the information accurately so if both of your names are still on the loan, the chances of it being removed from your file aren't very good. I know it sucks but at least you know now to be very careful when agreeing to be a joint applicant on something again. Good luck!
Posted: Mon Jul 05, 2004 10:52 am
Post subject: Credit Card Debt After Divorce
4/13/2002 9:05 am CDT
While married, my husband and I financed a car. Shortly afterwards, we were divorced and I was awarded the car and the liability. He remarried and declared bankruptcy and the debt was surrendered to me, the co-debtor. I made payments ahead of time and paid the car off early. I recently received a copy of my credit report and under Ford Credit, it says simply "included in bankruptcy" which has completely destroyed my credit. Bankruptcy court and Ford Credit say they aren't responsible. I've written to all three reporting agencies with copies of supporting documentation and hopefully this will be cleared up, but how could they have done this in the first place?
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Author: Dan
Posted: Mon Jul 05, 2004 10:55 am
Post subject: Credit Card Debt After Divorce
4/13/2002 10:30 am CDT
It must be frustrating to get caught in the middle. "They" are required to be truthful (that's why they respond in some way to our corrective information when we send it), but "they" are not required by law or by regulation or by agreement or even by fear of losing business to sort out all the details of a difficult situation.
And why is that? The credit reporting system was brought up as a response to the long proven fact that deadbeats cost lenders big money. To boil it all down to the bottom line, then, lenders are the customers of credit reporting agencies- the lenders pay and the credit reporting agenices profit from all those payments. "They" all make agreements among themselves that lenders will report every relevant transaction (that may be why your name got included in the report from Ford Credit who lost $$$), and that the credit reporting agencies will faithfully report all that information coming in from the lenders. Notice that we who borrow money and pay it back are not customers of this system. Any gripe we have about the system cannot cause that system any financial loss. They cannot gain us or lose us as customers!
The truthful reporting requirement comes in a small way from ethics ("they" want to do right), but mostly "they" are truthful because laws have been passed that allow us to sue them for wrongful reporting, and regulations have been established in each state with government agencies that can assess penalties and remove their business licenses. It may be that "their" primary motivation to be truthful is to avoid the cost of litigation from us and to avoid the cost of penalties from the government and to avoid being put out of business.
So now you have sent corrective information to each of the three credit reporting agencies (effective), and have also talked to some of the debtors (probably not as effective-they probably care more about the $$$ they lost than anything else). "They" now have reason to make inquiries about, what to them, is new information. To play "their" proper role in the system, "they" double check the new information that you provided, and modify what is reported on your credit reports. What to you is the disgusting stain of a bankruptcy report (hopefully) removed is to "them" nothing more than a simple correction. I don't even think "they" will say "sorry" or even "oh what a shame." I will, though.
And we haven't even talked here about the legal technicalities of your situation. It may be that "they" will not remove you from the stain of that Ford bankruptcy report. This is not me passing judgement! I don't know anything at all about your situation. But if the Ford car loan was transacted in such a manner that you were obligated on that loan (these regulations vary from state to state), and that obligation was NOT removed from you in your divorce decree, then the credit reporting agencies may find reason to faithfully report the facts of the matter even though everybody knows that those facts don't represent the reality- you paid off your car and he did not pay off his car! Wow would that be a drag. But if all this happened they would not lose a lawsuit about it- they reported facts. To cover this unfair situation, then, "they" are required to include in your credit report your prepared "explanation/rebuttal." That is about as far as the fairness goes. Again, sorry.
By the way, do not act on anything I have said here. I am not a lawyer and I don't work in the credit industry.
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Author: Misty
Posted: Mon Jul 05, 2004 10:56 am
Post subject: Credit Card Debt After Divorce
4/13/2002 4:55 pm CDT
The reason they did that is because you were listed as joint on the loan. You may have divorced & were given the car but most institutions don't honor "third party agreements"-like divorce decrees. So this means as far as the court is concerned, you were given the car & the liability but as far as the loan company goes, you're both just as liable as the other-unless they actually removed his name from the loan. I'm not sure how car loans are handled but I work in the credit department for a major credit card company & I know this is our policy. So when your ex filed bankruptcy, he included that account & that's why it's showing on your report. Unfortunately, the only thing you may be able to do is to file a consumer statement w/all 3 of the credit bureaus stating the bankruptcy was individual, but again not too many lenders will consider that. Ford Credit is required to report the information accurately so if both of your names are still on the loan, the chances of it being removed from your file aren't very good. I know it sucks but at least you know now to be very careful when agreeing to be a joint applicant on something again. Good luck!
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