Consumer complaint received 2023-08-11
Company: NAVY FEDERAL CREDIT UNION
State: MI
Product: Credit reporting, credit repair services, or other personal consumer reports
Sub-product: Credit reporting
Issue: Problem with a credit reporting company's investigation into an existing problem
Sub-issue: Their investigation did not fix an error on your report

Complaint:
A discharged debt can not be late or in collection. Upon the termination of the credit account any balance due is to me the consumer.

12 CFR 1026.11 - Treatment of credit balances ; account termination.

1026.11 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 : ( 1 ) Credit the amount of the credit balance to the consumer 's account ; ( 2 ) Refund any part of the remaining credit balance within seven business days from receipt of a written request from the consumer ; ( 3 ) 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. 

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

( 2 ) Nothing in paragraph ( b ) ( 1 ) 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 ( 1 ) 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.

( 2 ) 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 ) ( 2 ) ( 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.

( 3 ) 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 ) ( 2 ) of this section is received within 30 days after disclosure.

15 U.S. Code 1681 - Congressional findings and statement of purpose U.S. Code ( a ) Accuracy and fairness of credit reporting The Congress makes the following findings : ( 1 ) The banking system is dependent upon fair and accurate credit reporting. Inaccurate credit reports directly impair the efficiency of the banking system, and unfair credit reporting methods undermine the public confidence which is essential to the continued functioning of the banking system.

( 2 ) An elaborate mechanism has been developed for investigating and evaluating the credit worthiness, credit standing, credit capacity, character, and general reputation of consumers. 
( 3 ) Consumer reporting agencies have assumed a vital role in assembling and evaluating consumer credit and other information on consumers.

( 4 ) There is a need to insure that consumer reporting agencies exercise their grave responsibilities with fairness, impartiality, and a respect for the consumers right to privacy.

( b ) Reasonable procedures It is the purpose of this subchapter to require that consumer reporting agencies adopt reasonable procedures for meeting the needs of commerce for consumer credit, personnel, insurance, and other information in a manner which is fair and equitable to the consumer, with regard to the confidentiality, accuracy, relevancy, and proper utilization of such information in accordance with the requirements of this subchapter.

Company public response: Company believes it acted appropriately as authorized by contract or law
Company response to consumer: Closed with explanation