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Debts discharged in bankruptcy reported as LATE on credit report

Mon Feb 18, 2008 11:02AM | By Tony

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Q: I have declared Chapter 7 bankruptcy 2.5 years ago. I had account with Capital One which was discharged. Last week I obtained my credit report from TransUnion showing the same account twice - as INCLUDED IN BANKRUPTCY with $0 balance, and showing Late Dates: 11/04 -30, 12/04-30. While I am not looking for a credit, it does bother me a lot. What about Charge-offs, I had several and don't want them pop up later.

A: Dispute it. All debts discharged as part of your bankruptcy must be reported with a $0 Balance, show $0 Terms, and show nothing Past Due after the date of your bankruptcy filing. It has to say 'Included In Bankruptcy' or 'Chapter 7 Discharge' or something similar. Check Derogatory Accounts page. If an account isn't reported this way, start disputing.

In general, the Lates and Charge-offs occurred before you filed a bankruptcy, can still legally be reported. But discharged debt can not be reported as Late. With Charge-offs the FTC rule is that, if a debt was not Charged off before you filed for bankruptcy, it can not be reported as a Charge-off after your bankruptcy, as continuing negative credit reporting on a discharged debt is recognized continued collection activity, which is a violation of the automatic stay of bankruptcy.

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