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Credit Bureau Reporting Forbidden on Several Types of Debts

We have been made aware of a growing concern that collection agencies are increasingly not reporting debts to credit bureaus. Believe us when we say that creditors across various industries are voicing their complaints. Obviously, this has a negative impact on the recovery rate.

If collection agencies had the ability to report every legitimate debt, they certainly would when all other collection efforts fail. However, the reality is that Credit Reporting Agencies (CRAs) — TransUnion, Experian, and Equifax — do not permit it in all cases.

Here is an excerpt from the credit reporting manual of one of the major CRAs:

We does not accept the following types of data from our furnishers, either directly or as collection accounts that have been assigned to third parties.

  •  Fines and Fees – Examples include but are not limited to:
    –  Towing Charges
    – Vehicle Storage Fees
    – Parking and Traffic Tickets/Fines
    – Toll Road Fines/Fees
    – Ordinance Violations
    – Library Fines
    – Video Rental Fees
    – Prequalification Fees
    – Brokerage Fees
    – Eviction Fees
  • Continuity Clubs – Examples include but are not limited to:
    – Health Club Dues
    – Karate Club/Martial Arts Dues
    – Magazine Subscriptions
    – DVD/Book Club Fees
  •  Pre-Paid Debit/Gift Cards
  •  Checking/Savings Account Activity/Balances
  •  Home Owners’ Association (HOA) Dues
  • Child Support Enforcement Data from Non-Government Entities
  • Tribal loans not compliant with federal and state lending laws
  •  Unpaid Taxes*
  • Unacceptable Data by Industry Type – Bail Bonds Companies – Check Cashing Companies – Pay Day Loan Companies

The banking industry has been hit with what the CFPB called “Junk fees” and there is a full assault on collection agencies attempting to collect medical debt – not only from the CFPB on the federal side, but from the state side too.

Already a dozen states made it illegal to credit report on medical debts. Even a state like Indiana (a traditional red state) is not only attempting to block credit reporting but also stating that collection agencies would not be able to get judgments if they file suit.  This is problematic.

If the balance merits it ($2K+) and the debtor has a decent credit score, job and maybe some assets like a home, Collection Agencies could file suit.

( Article written on 02/20/2025)

Filed Under: Debt Recovery

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