Product: Debt collection

NAVY FCU Is alleging I owe a debt and is reporting this account incorrectly to the consumer agencies. Any consumer account that is charged off with a balance over a {$1.00} is due to the consumer not the credit so is Navy Federal Credit Union stating they are exempt from following federal law as enacted to govern commercial transactions. 

XXXX Treatment of credit balances ; account termination. 
( a ) Credit balances. When a credit balance in excess of {$1.00} is created on a credit account ( through transmittal of funds to a creditor in excess of the total balance due on an account, through rebates of unearned finance charges or insurance premiums, or through amounts otherwise owed to or held for the benefit of the consumer ), the creditor shall : ( XXXX ) Credit the amount of the credit balance to the consumer 's account ; ( XXXX ) Refund any part of the remaining credit balance within seven business days from receipt of a written request from the consumer ; ( XXXX ) Make a good faith effort to refund to the consumer by cash, check, or money order, or credit to a deposit account of the consumer, any part of the credit balance remaining in the account for more than six months. No further action is required if the consumer 's current location is not known to the creditor and can not be traced through the consumer 's last known address or telephone number. 

( b ) Account termination. 

( XXXX ) A creditor shall not terminate an account prior to its expiration date solely because the consumer does not incur a finance charge. 

( XXXX ) Nothing in paragraph ( b ) ( XXXX ) of this section prohibits a creditor from terminating an account that is inactive for three or more consecutive months. An account is inactive for purposes of this paragraph if no credit has been extended ( such as by purchase, cash advance or balance transfer ) and if the account has no outstanding balance. 

( c ) Timely settlement of estate debts ( XXXX ) General rule. 

( i ) Reasonable policies and procedures required. For credit card accounts under an open-end ( not home-secured ) consumer credit plan, card issuers must adopt reasonable written policies and procedures designed to ensure that an administrator of an estate of a deceased accountholder can determine the amount of and pay any balance on the account in a timely manner. 

( ii ) Application to joint accounts. Paragraph ( c ) of this section does not apply to the account of a deceased consumer if a joint accountholder remains on the account. 

( XXXX ) Timely statement of balance ( i ) Requirement. Upon request by the administrator of an estate, a card issuer must provide the administrator with the amount of the balance on a deceased consumer 's account in a timely manner. 

( ii ) Safe harbor. For purposes of paragraph ( c ) ( XXXX ) ( i ) of this section, providing the amount of the balance on the account within 30 days of receiving the request is deemed to be timely. 

( XXXX ) Limitations after receipt of request from administrator ( i ) Limitation on fees and increases in annual percentage rates. After receiving a request from the administrator of an estate for the amount of the balance on a deceased consumer 's account, a card issuer must not impose any fees on the account ( such as a late fee, annual fee, or over-the-limit fee ) or increase any annual percentage rate, except as provided by 1026.55 ( b ) ( 2 ).

( ii ) Limitation on trailing or residual interest. A card issuer must waive or rebate any additional finance charge due to a periodic interest rate if payment in full of the balance disclosed pursuant to paragraph ( c ) ( XXXX ) of this section is received within 30 days after disclosure.