How do I fix my credit after a wrongly reported mortgage forbearance?

J

JuddRoidDream

New Member
So we had to go with an agreed forbearance on our mortgage after my husband got hurt. When we started paying again and did that COVID loan modification thing—you know, where tehy take the missed payments and turn it into a second lien that you pay off when you sell the house or whenever you want—they told us it wouldn't hurt our credit at all.

Well, I just found out today that my husband's credit score took a nosedive—like, 100 points—and it's been marked as delinquent.

We're about to make the last payment on my car next month, and we really, really need to buy another one because my husband's car is totally done for. Honestly, I feel sick about it because his credit score now, plus this negative mark, is going to make that so much harder. We can't afford to pay cash for a car, and sharing one just isn't an option with his work hours and all our son's therapy appointments.

On top of that, we're hoping to move out of state next year and buy a new house. This whole thing is just crushing.

Has anyone been through something similar or have any ideas what we can do? The mortgage company isn't helping at all—they're just saying it's correct and not explaining why they reported it after saying they wouldn't. I feel like I'm hitting a brick wall every time I try.
 
Your frustration is justified, as this reporting appears inconsistent with regulatory requirements. Under the CARES Act (Section 4021), if you were current on your mortgage when entering a COVID related accommodation or forbearance, the servicer must report the account as current for the duration of that period. Reporting it as delinquent while a forbearance or modification was active mmay directly violate the Fair Credit Reporting Act (FCRA) and the servicer’s obligations under the CARES Act.

The core problem is that lenders frequently misapply codes or re age such accounts, which leads to the credit score decline you observed. This can be disputed on the grounds of factual inaccuracy, particularly if you have written confirmation from your servicer stating your credit would not be affected. In any dispute, you should require both the credit bureau and the servicer to demonstrate their compliance with federal law.

If you anticipate applying for an auto loan or mortgage soon, it is advisable to resolve this matter promptly. Such reporting inaccuracies can determine approval versus denial and significantly affect interest rates. This situation is one where professional assistance and the proper application of relevant statutes can achieve a correction.
 
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