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Credit reports can come back to haunt you

Ellen Roseman
Toronto Star
June 4, 2011

Information on your credit report can come back to haunt you when you apply for a loan. Leanne Elnicki hopes her experience helps others who conquer their debt, only to run into a brick wall trying to update their credit report.

"A few years ago, I did a consolidation," she says. "It was my third time racking up debt. Didn't learn my lesson until it was far too late.

"I ended up contact a company that worked out deals with my creditors and at the end of it all, I was in hock for more than $27,000.

"It took me 4 1/2 years, but by April 2009, I was finished, paid off in full. Never missed a payment of $623."

Two years later, she owns a condo. She has a credit card, secured with a cash balance of $750. She doesn't own anything to anyone.

"But I can't get credit at Leon's. I can't get overdraft protection. I couldn't even get a bank loan to purchase RRSPs last year when I presented them with my one-month plan to pay it back," she says.

Finally, Elnicki ordered her credit report. It showed that one of her creditors hadn't reported up-to-date information to the credit bureau.

CitiFinancial still showed her status code as R7, which means payments were made under a consolidation order. All her other creditors had her down as R1 (the best credit rating).

"How are people like me supposed to make things right?" she asks. "I did the crime and the time, so to speak. How much longer do I have to suffer for my mistakes?

"Why on earth does it take this long for a company to report to the credit bureau? It's unacceptable."

Troy Underhill, Citi's spokesman in Toronto, cleared everything up within a few hours. He thanked me for bringing the case to his attention.

"I received a call from the president's office at CitiFinancial and spoke to a lovely woman there," Elnicki reported the next day.

"She was able to determine that the entry in question on my credit report dated back to 2003. It was for a mere $300 and was on of the first things paid off during my consolidation in 2005."

It seemed Citi had received a number of faxes from her debt managers, trying to update the R7 status code. Nothing had been done.

"The problem was finding someone to speak to. Citi's website is a disaster and the 800 numbers I called were all about how to get more credit," she says.

"When I told them I wanted to discuss an old account, they said they couldn't help. The operators were also all in the U.S.

"I found a 905 number for an office in Mississauga, Ont., but there was no receptionist. I dialed a man at random hoping to find help. They didn't make it easy to speak to a person."

Elnicki's experience shows consumers have to check their credit reports - and companies have to be more vigilant in their reporting practices.

Citi is going through a transition in Canada. Last June, it made a deal to sell most of its Canadian MasterCard business to CIBC for $2.1 billion.

With the Citi purchase, CIBC has added MasterCard products to its stable of Visa cards. It's now writing to cardholders to tell them about the changes.

Wilbur Garvie got a letter, saying his Citi MasterCard will be replaced by a CIBC Dvidend One MasterCard. Unfortunately, he won't get the 22-day out-of-country medical coverage he used to enjoy. "The medical coverage has been a valuable benefit we hate to lose," says Garvie, who's over 80 years old.

Rob McLeod, a CIBC spokesman, said the Citi card had a $99 annual fee while the CIBC Dividend One MasterCard has no annual fee.

"We are reimbursing a pro-rated portion of the annual fee cardholders paid previously to Citi. This will appear as a credit on their first CIBC statement," he explained.

The CIBC Dividend One card offers 1 per cent cash back on purchases, McLeod said.

Meanwhile, travel medical insurance is not widely available on credit cards in Canada for those over 65.

"Clients under age 65 can opt to take another card in the CIBC family if they wish to retain travel medical benefits for up to 15 days," McLeod added.

CIBC has acquired the following Citi MasterCards: Gold, Enrich, Platinum, Gold Plus, Petro Points and Driver's Edge, McLeod said.

It did not acquire the following Citi MasterCards: Sobeys, Staples and Home Depot.

Citi kept its store cards, such as the Petro-Canada and Home Depot cards that are not MasterCard products.

 

Posted on Tuesday, June 7, 2011 at 01:24AM by Registered CommenterElaine in | CommentsPost a Comment | References1 Reference

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