Capital One Bank (USA) is a national bank headquartered in Glen Allen, Virginia. It has about 500,000 credit card accounts with West Virginia consumers. Capital One Services, LLC, Capital One Services II, LLC, Capital One Services III, LLC, and COSI Receivables Management, LLC are Delaware corporations that service and collect on the credit cards issued by Capital One Bank.

The complaint filed in Mason County is based on numerous violations of West Virginia’s consumer protection laws. The complaint alleges that Capital One solicited consumers to enter into debt repayment plans by sending them solicitations that were disguised as offers of new credit. The offer was sent to consumers who had charged-off accounts with Capital One or other creditors. Under the terms of the offer, Capital One agreed to provide the consumer $1.00 of new credit in exchange for the consumer’s agreeing to transfer the entire account balance of a charged-off account to the new credit card account. The consumer was required to make payments on the old debt in order to receive any further increases in the credit limit on their new credit card.

By transferring the old debt onto a new credit card, Capital One was able to charge interest, late fees, and over-the-limit fees on debt that otherwise would not have been subject to those fees. It also allowed Capital One to re-age the debts so that the applicable statute of limitations period started new.

The complaint also alleges that Capital One: issued multiple low-limit credit cards, each charging exorbitant fees, rather than raising credit limits on consumers’ existing accounts; unconscionably imposed over-the-limit fees on consumers’ accounts; sold services to consumers who could not benefit from the services; and, billed and attempted to collect for credit card accounts that were never activated.

Attorney General McGraw stated, “Capital One’s practice of offering nominal extension of credit, if and only if, the consumer agreed to pay off a debt too old to be sued on is tantamount to loan sharking.” Until recently, the Attorney General was under a federal court injunction that prohibited him from suing the bank for its credit card practices; however, on January 4, 2010 United States District Court Judge Robert Goodwin granted the Attorney General’s motion to modify the injunction. Under the new order, the Attorney General is not prohibited from suing the bank to enforce non-preempted substantive state laws.

For more information or to file a complaint, please contact the Attorney General’s Consumer Protection Division. Call 1-800-368-8808, write to P.O. Box 1789, Charleston, WV 25326-1789, or visit his website at wvago.gov.

Russell

A friend who works for a major mortgage lender said that I could request for them to reage or adjust the reporting to reflect only one month actually missing. I have had no response from the mortgage company so far.

Jennifer

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Hi Jennifer,

It sounds like you are saying the reporting is four times thirty-days late.  Yes, that is the correct reporting based on what you’ve cited.

It is possible to re-age a HELOC.  To get a “response from the mortgage company”, follow the rules of the Qualified Written Request.

Thanks for the questions and hope this helps.

Paul

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Hello Joe,

It should be off your report, unless they re-aged it.  Re-aging by a debt collector is an FCRA violation.

Thanks for the questions and hope this helps.

Paul

Okay let me get to the Meat of my question it will take like from the time i start doing it like 1600 to 1700 bucks to get current on all my credit cards!!! which the high ones like 5 with a TOTAL OF LIKE 9000 GRAND PLUS I HAVE 2 OTHER ONES THAT LIKE 300 BEHIND. THE ONLY WAY I can DO SOMETHING which i am IS WHEN I LEAVE FROM I AM Living now state wise that is.  BECAUSE I WILL HAVE A JOB AND I CAN START MAKING PYMTS after i become current.

I know i am not going to become current where i live now so will they close these by may 08  if i have the $$$ to make it current??? and continue making my pymts as if i did not lose a beat even i know i did.i do not want ruin my credit hell it is already huh will they waivethe late fees???

Franz 

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Hello Franz,

Charge-off for credit cards is typically at 180-day delinquency.  Keep in touch with the credit card companies and let them know where you are so they can notate their computer file and when you are back to work they can re-age them for you.

Thanks for the questions and hope this helps.

Paul

Jeff

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Hello Jeff,

Sounds like a textbook case for re-aging.  My advice is to get it in writing.

Thanks for the questions and hope this helps.

Paul

       I’ve been reading your website that last two days and decided to finally write for your opinion.
I am 25 year old single mom who just a had a baby boy.I have a HORRIBLE Credit Report and Im not sure my next step to take.The last two years I took the approach to start paying off my collections on my credit report to bring up my score. Which to my surprise it did raise it because I was able to buy a car in July of 2007. I also went and got 2 credit cards.When I was 18 i went and obtain creidt and didnt know how to handle it. Now because My car note and my debt took the best of me. My credit score plummet down to the floor when I bought my car my credit score was 640 now its below 500.My car was repossessed and my credit cards are in collections. i want this to be clear and not showing credit settled on my report when i Pay my debts.

Question 1
will paying off my collection debt and repo help my credit score

QUestion 2
If no to question 1 how can i raise my credit score.

Question 3
How long should i wait to purchase a house for my son and I.

I already have 3 arrangements with collection agencies to pay off the debt. Was this the right thing to do

PLEASE HELP

Francesca

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Hi Francesca,

1) That’s not an easy answer.  If, for example, you were to pay it all off with a lump sum now, then ‘yes’ it would improve your score because the repo [car bought in July 2007] and collections are recent.  On the other hand, if you were to enter into a payment plan on these items [absent re-aging the credit cards – which would help] then you may find that the account is continually updated to the bureau each month and the repayment plan isn’t really helping your credit score.  Both of these statements are general statements and not absolutes for your particular circumstances.

2) Save & Settle.

3) Two years of continual employment, Two years of verifiable rent history, and post save and settle. 

Thanks for the questions and welcome to the site!

Paul

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Hi Marilyn,

Re-aged, now what?  The wonder collection goes round and round.

Thanks for the questions and hope this helps.

Paul

I havent been on here in awhile but I have a question. 

My mother has been very sick, she has cancer in her ears nose and throat. 

Because of all the traveling I have had to do, I am 3 months behind on my carecredit card. 

Is there something I can do to get them maybe to reage this account if I get caught up?  Could you please tell me the steps I need to take? 

Thank You
Vanessa

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Hi Vanessa,

Sorry to hear about your Mom’s condition.  Here is the verse for the day: “Beloved, I wish above all things that thou mayest prosper and be in health, even as thy soul prospereth”. 

Re-aging guidelines were published by the FFIEC on June 12, 2000.  The feedback we’ve received from the Broken Credit Blog members shows that credit card companies seem to take differing views on the credit reporting implications of re-aging. 

You are in a better bargaining position now that you are past due and so I would suggest that you have them clarify in writing how they intend to report the account to the CRA, once you have made three on-time payments.

Thanks for the questions and hang in there Vanessa!

Paul

I have a equity line on my property that I have fallen behind on. 

I pay my 1st mortgage on time. 

I am not behind. 

What are all of the consequences of the equity line other that a bad credit rating.

Kathy

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Hi Kathy,

Depending on state law and your circumstances, the Home Equity Line of Credit [HELOC] could foreclose, a deficiency judgment could be entered against you, and 25% of your wages may be garnished.  Will that happen?  I don’t know.

What I do know is that mortgage lenders have stopped originating high Loan-To-Value HELOCs and particularly the stated income variety, because far too many homeowners are in the situation you’ve described.

Kathy, one positive thought that comes to mind is the fact that a HELOC may be re-aged.  A borrower who is past due on a HELOC may negotiate the re-aging kind that deletes the derogatory history and the result becomes a squeaky-clean credit report.  Of course, get the HELOC lenders written explanation of how they define re-aging [with regards to credit reporting implications] prior to the re-aging.

My opinion is that generally, a high LTV [with little equity] HELOC borrower is not at high risk of foreclosure, although I strongly recommend that every borrower who is behind on payments, contact their lender and explain the circumstances.  Otherwise, the lender has no choice but to assume the worst.  Why would a HELOC lender sit and wait for a borrower that doesn’t call and explain the problem? 

Was there ever an episode of “Three’s Company” where the rent was due and our stars were ducking Mr. Roper or Mr. Furley?  I thought I’d throw that in there only for reason to add a picture to this post.

Thanks for the questions and hope this helps.

Paul

This author is not an attorney and this information should not be considered legal advice.  Please consult an attorney for legal advice.