A foreclosure was vacated by the mortgage company?

Question

Never heard of this one before and was hoping I could help out a potential buyer of mine. She had a property where the mortgage company started foreclosure proceedings against her, but she was able to sell the property (at a profit - this was 2006/2007) before the mortgage company actually foreclosed. She showed me the legal summary and it shows the last 2 actions on the case as the mortgage company filing a motion to vacate the order of foreclosure and the mortgage foreclosure being voluntarily dismissed.

However, a "foreclosure" still shows up on her credit report? Can this be disputed on the grounds that the bank filed and was granted an order to vacate the order of foreclosure? Thanks.

Tim

However, a "foreclosure" still shows up on her credit report?  Can this be disputed on the grounds that the bank filed and was granted an order to vacate the order of foreclosure?  Thanks.

Tim

Adam Anderson · Answer

She can dispute the items on the grounds that they are not accurate. The proof that is not accurate is the summary showing that the foreclosure being dismissed.

Credit reporting agencies are obligated by law (Fair Credit Reporting Act) to maintain accurate records. They have 30 from the date they are giving notice to investigate and correct any incorrect information or delete the item from their file. If do not correct or remove it they are liable for damages incurred. (you were turned down on a loan because they are incorrectly reporting that you have a foreclosure in your credit report. Or you received a higher rate because of a low credit score.)
 
          If you provide them the proof that an item is not correct and let them know you are soon going to be applying for a home loan, It is highly unlikely that the items would not be removed.

Jim Wineinger · Answer

Tim, it seems like an easy solution, in theory. But you are supposed to be able to add a document to your files when you are disputing something an in error.

I would have her submit the court ordered dismissal (voluntary as it was) to all three main credit agencies and see what happens.

I did this on an IRS claim against me and a State tax claim against me and both were removed.

Dont know the proper procedures but it is not without precedence on the credit agency side.