Consumer complaint received 2018-04-19 00:00:00
Product: Credit reporting, credit repair services, or other personal consumer reports — Credit reporting
Issue: Problem with a credit reporting company's investigation into an existing problem — Problem with personal statement of dispute
Company: Bread Financial Holdings, Inc.
State: CO

Complaint narrative:
Hello, In XX/XX/XXXXI settled a few accounts rather than paying them off because I was facing financial issues. In XX/XX/XXXX/XX/XX/XXXX I paid {$700.00} of the {$1000.00} owed to XXXX XXXX  ( XXXX XXXX card ) and I considered the debt settled. XXXX, however did not. For the next several years they continued to report a charge off on my report every single month. I needed to refinance and pulled my credit a few years later and saw that my score was still very low even though I had been paying my debts, this is when I discovered what XXXX XXXX  was doing. I called XXXX and they said they will report forever on my report every month until the entire debt was paid. This didn't seem right to me, but I needed to get my refinance done so in XX/XX/XXXX I paid the remaining difference on the original debt, {$300.00} ish, and XXXX   stopped reporting the charge off. On XX/XX/XXXX I looked over my report and saw that huge history that XXXX  had posted against me after I settled, but that none of the other creditors had, and decided that didn't seem fair or right, and 5 years later it is still pulling me down.

I opened a dispute through XXXX to question whether it was OK for XXXX to have dinged my report like that for 2-3 years when I had already settled the debt. I did NOT dispute that the information showing was incorrect, only opened the dispute to question whether XXXX was allowed to do that and if not have the reports removed.

As a result of opening the dispute, XXXX reached out to XXXX to inquire on the status of the account, and XXXX  reported back that the account was a charge off ( which it was ). XXXX posted the charge off/failure to pay as of XX/XX/XXXX, and my credit score dropped 21 points as a result of this. I talked with XXXX who said that they only reported back the status of the report, it was a charge off as of whenever I settled and then paid off the final balance. XXXX said that when I open a dispute, that they reach out for an update and it causes the card company to report on the account again, which is what caused my score to drop.

My problem with this is that in asking a question about the essential legality of XXXX  's practices, I was subjected to very damaging and incorrect information being recorded permanently ( or for 7 MORE years because I " acknowledged '' the debt ). XXXX is refusing to correct this damaging information on my report, as is XXXX because from their standpoint all they did was give XXXX the status of the account.

Not being able to inquire on the legality/correctness of information on your credit report without being severely penalized doesn't seem like a fair or legal practice, and the result is the suppression of complaints -- many of which no doubt may be legitimate, and thus the continuation of unfair and harmful practices such as I have experienced.

I would like for XXXX  's practice of reporting negatively on debts after they are settled to be reviewed/reported as unfair and unethical, and would also like for XXXX 's practices to be reviewed as this is grossly unfair that my ability to buy a house, car, or otherwise obtain credit is being severely impacted simply because I asked a question.

A lowering of 21 points on my credit score moved me from Good credit to a Fair credit rating, and that is real dollars out of my pocket in terms of the interest rates I can receive ( tens of thousands if you consider the difference a higher interest rate on a mortgage will cost me over 30 years ). If it is determined that XXXX  is not legally allowed to report on an account that is settled, then we are talking about real dollars their practice has already cost me because my credit score was impacted and I did not receive the rate I would have with a better score on my refinance and my car loan as well as any credit card I have opened since XX/XX/XXXX.

I hope this letter will at least resolve my current issue and beyond that spark a review of XXXX 's practices which do not seem to be in line with other creditors.

Regards, XXXX XXXX XXXX

Company response to consumer: Closed with explanation