Charge Off Dispute Unsuccessful

[Harrell]

Thank you so much for your very quick response and the valuable information, Robert! I so appreciate it! A couple followup questions:

1) Since I've already formally filed a dispute(via internet) and received a formal letter back from CSC(Equifax) via US Mail stating that GMAC verified the charge off is correct, can I move on to step 3?(Or is it important that I refile again using registered mail?)

2) When I get a hold of the Executive Offices at GMAC and if I'm lucky enough to talk to the Director of Credit Bureau Reporting, what do I say? Any buzz words I should use? Do I have to run through my story at a detailed level or just a summary? What suggestions do you have?

Thanks again. Believe it or not, it was almost relieving to hear that others have had similar problems with GMAC.(Misery loves company.) I'm absolutely sick to my stomach over this!!

------------------------- Followup To - Robert -

I had a Smart Buy vehicle through GMAC which the contract ended in 10/2001. In mid Sept 2001 I returned the vehicle to the dealer per the contract. My address and name had changed due to marriage and I provided a forwarding address and name to dealership so that my final payment invoice could be sent to me. I didn't hear anything from GMAC until Jan 2002 - from their collections dept stating that GMAC FS reported this vehicle as a repossession. I contacted the dealership, the dealership in turn contacted GMAC. After going back and forth for a couple weeks, GMAC stated via phone conversation that it was a mistake on GMAC's end and that I only owed the final payment. They stated the amt. owed and address to send the payment. I paid them that same day and saw the check clear on my bank statement. I've never heard another word from them! I've gotten loans, mortgages, etc and my GMAC acct status always showed closed and paid as agreed. Suddenly in Feb 2005, I received a letter from GMAC stating they have filed a delinquency on my CR. I attempted calls to GMAC who state there's no record of my acct. I ordered a CR and sure enough they're reporting a Charge Off for $5500!? I disputed through CSC Credit Services and received a letter yesterday stating that GMAC claims they are reporting correctly. I don't know what to do now! I thought this was a simple misunderstanding back in 2002 and I paid them as I had agreed to. I am unable to retrieve copies of the dealer paper work due to the fact that it's 4 years old. About the only thing I can get my hands on is a cleared check from the Bank. What do I do to fix this? I have a totally clean CR with the exception of this 5500 charge off. I honestly believe this is incorrect information(I owed less than $500 as a final payment). I'm unable to find anyone at GMAC to give me any information. Where do I go now? Any advice would be greatly appreciated!

[Winn]

: Refile with ALL three bureaus AGAIN via certified mail. This is to establish a paper trail of knowledge.  I do not recommend the net filing for a matter like this.  

Be sure to send a cc of the letter to GMAC.  Be detailed in your descriptions.

2) When I get a hold of the Executive Offices at GMAC and if I'm lucky enough to talk to the Director of Credit Bureau Reporting, what do I say? Any buzz words I should use? Do I have to run through my story at a detailed level or just a summary? What suggestions do you have? I would say that you are being VICTIMIZED because of the erroneous information that they are posting. If you are trying to purchase a home, the mere difference in the 30 year interest rate would be about 100K, so you would hate to have to hold them liable for this additional expense.

Be sincere and explain your case, and then get the reps name, street address(for FEDEX- not PO BOX) and a fax number. Once you have this information, send them a confirmation letter confirming the conversation and agreement that you just had.

This is really important.

Remember, in cases like these, he who has the most documentation ususally wins.

Let me know!

Robert Paisola

[CIywd]

Jennifer, It is great to hear from you again.  Let me answer your questions in the order that you asked them.

1) Since I've already formally filed a dispute(via internet) and received a formal letter back from CSC(Equifax) via US Mail stating that GMAC verified the charge off is correct, can I move on to step 3?(Or is it important that I refile again using registered mail?)

[Bonde]

- Hello Jennifer,

First of all, I want to thank you for taking the time to write.  I am happy to assist you in your quest for knowledge.

Your situation is quite common with people who have had leases via GMAC.  One of the first issues that I see is that you dealt with the dealership, and not GMAC directly.  Unfortunately, there is a difference.

The good news is that this should be a simple fix for you. Here is what you need to do:

1. get copies of all three of your credit reports, Trans Union, Equifax and Experian.

2. FIle a formal dispute outlining the problem with the tradeline. They will then contact GMAC and most likely GMAC will verify the charge off is correct. Do this via US MAIL and send everything certified so that you get the green verified return receipt.

3. Call the main GMAC Number:

GMAC Customer Service Center(auto financing)   1-800-200-4622 or Vehicle Finance   1-800-32-SMART Ask for the Executive Offices and get the name of the director of the Credit Bureau Rating Department.  Here is a recent article that was published in Detroit on GMAC for you to read at the end of this post, This is why there are so many problems right now with GMAC.  If you still run into brick walls, give us a call and fax all of your information to 408-889-2415 and we will assist you.

Jennifer, It is my hope that this information has assisted you in your quest to take care of this serious problem.  Please take a moment to post some awesome feedback on the site, because Your public feedback means a great deal to me, as I am glad to now be able to assist you and many others with their matters, now that my company has been acquired and I have a little more time to assist!

God Bless You!

Robert Paisola

___________________________________________________________

Here is a Copy of the Article:

___________________________________________________________

General Motors Corp. sells its life preserver -- the profitable GMAC finance unit -- will automotive operations sink or swim?

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GM Chairman and Chief Executive Officer Rick Wagoner said Monday the company is exploring selling off all or part of General Motors Acceptance Corp. A wholly owned subsidiary of GM since 1919, GMAC sells automotive financing, commercial financing, insurance and mortgage products and real estate services.

"I had noted in June that we were in the midst of a detailed study of the strategic options available to us," Wagoner said of GMAC. "We are announcing today that we are exploring the possible sale of a controlling interest in GMAC to a strategic partner."

Auto experts estimate GM could raise between $10 billion and $15 billion by selling a controlling 51% stake in GMAC. What's more, a sale could improve GMAC's credit rating and free it from GM's junk, or speculative, bond rating. That should make it easier and less expensive to borrow the billions of dollars it needs every year for loans to consumers and businesses, and make it a healthier company.

"Over the long term, owning less of a very profitable enterprise returns you more than owning all of a business that is somewhat constrained," said GMAC spokeswoman Joanne Krell.

But what might happen to GM without GMAC, and its lucrative earnings, is a critical question for the automaker.

While the billions in cash it might raise would certainly make investors like Kirk Kerkorian happy, especially if the sale resulted in an increased dividend, GMAC's profits have helped offset losses at the carmaking operations.

Without GMAC, GM would have lost $2.2 billion more this year, on top of its $3.8 billion, for a grand total of $6 billion.

Peter Morici, a University of Maryland business professor who follows the automotive industry, said he doesn't believe GM can survive on automotive operations alone.

"Right now, as they're presently structured, they just can't make cars that people will pay, that people want to buy, at a price that they can cover their costs," Morici said. "They can't cover their costs at the price people are willing to pay for their cars, and this doesn't change it."

With GM's automotive operations in trouble, despite hot-selling vehicles such as the Chevrolet HHR and Hummer H3 SUVS, selling part of GMAC might be irresistible to GM.

"Our sense is that a 51% sale could raise more than $11 billion, potentially improving GMAC's cost of funds," H. Peter Nesvold, an auto analyst with Bear Sterns in New York, wrote in a note to investors.

Some financial experts say GMAC has become more valuable than all of GM.

David Healy, an auto industry expert who advises clients of the brokerage Burnham Securities in New York, estimated that GMAC is worth more than $30 billion. That's a lot because, theoretically, one could buy all of GM's shares for about $17 billion.

While GM no longer feels comfortable telling investors how much it might earn, GMAC said it's still on track to earn more than $2.5 billion this year, which will help buoy the carmaker's sinking bottom line in automotive operations.

GM's global automotive operations lost $3.8 billion for the first nine months of the year, and virtually all of it came from the North American automotive division. GMAC, meanwhile, earned $2.2 billion during the same period, although those results are down about $11 million from last year.

While GMAC's performance is helping GM, GM's poor results are hurting GMAC.

GM's speculative, or junk, credit rating is shared by GMAC, hampering the financing company's ability to raise money. A speculative rating means the company faces an adverse business climate that makes it more likely to default on loans.

Wagoner said selling off part of GMAC is intended to restore "GMAC's investment-grade credit rating and renew its access to low-cost funding."

To that end, GM restructured the highly profitable residential mortgage business at GMAC into a single subsidiary called ResCap. Starting a new unit enables it to command a higher credit rating than the one shared by GM and GMAC.

GM also took action to sell a 60% equity stake in GMAC's profitable commercial mortgage business to a consortium of investors. That will protect its investment grade credit rating and enable GMAC to achieve superior returns.

The credit rating agency Standard & Poor's said it might consider changing GMAC's overall credit rating if GM takes the right action with the financing arm.

"We view an investment-grade rating for GMAC as feasible, if GM sells a majority stake in GMAC to a highly rated financial institution with a long-range strategic commitment to the automotive finance sector," S&P wrote Monday.

"GMAC still would be exposed to GM-related risks that would continue to stem from its role as a provider of funding support to GM's dealers and retail customers. ... Absent steps to significantly limit its ownership control over GMAC, GMAC's ratings ultimately again will be equalized with those of GM."