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I was sued for a debt in late 2011 by Farrel & Seldin, attorneys for Capital One , regarding 2 credit card debts. I entered...

Denver, CO |

... into stipulation with them and have been paying $50/month on the two debts since November 2011. Both stipulations read the same, except for the figures in #1. #1 reads, "Defendant(s) acknowledges indebtedness in the amount of $----.--, $----.-- interest, and $---.-- costs with interest at the contract rate of 8% per annum. Defendant has agreed to pay the amount of $----.-- with interest to accrue at the rate of 0%." I recently looked at my credit report; the accounts are charged off. I have been paying the $50, but the amounts are going up -- accruing interest, I assume. Can they do this, when the Stipulation agreement says 'interest to accrue at the rate of 0%'?

Attorney Answers 3


Your credit report has nothing to do with this. What is in the stipulation controls the debt. Your credit report is not a legal document; credit reporting rules (along with banking regulations, etc.) sometimes require a debt to be reported a certain way even if you have an agreement with the creditor.

You can always call F&S and request to know the balance remaining.

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Whether the creditor can charge you interest depends on the language of the stipulation you signed with them. If you think the credit reporting agencies are reporting an incorrect balance amount you can send them a dispute letter (send one to each of the three major credit reporting agencies) explaining your disagreement with their report. Send a copy of the dispute letter to the creditor and always keep copies for your files.

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The short answer is "Yes." Charging off a debt is an internal accounting procedure and has nothing to do with the underlying obligation. The judgment is valid. As to the amounts going you should contact the attorney and ask why. If you only pay $100 on these 2 accounts you should comply all your debts and determine if it is in your best interest to a BK lawyer.

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