Law Office of Allan E. Dunaway, PLC

Bank mistakenly reports customers as bankrupt

When you file for bankruptcy protection, you know that your credit rating may take a hit. Not because the bankruptcy filing has some magic property, but you recognize that by the time you need to file a bankruptcy, your financial situation is less than stellar. Your finances have deteriorated to the point that your debts are so overwhelming that you simply cannot meet your obligations any longer and a Chapter 7 or Chapter 13 bankruptcy becomes your only option.

Imagine the surprise and frustration when some customers of Fifth Third Bank received a letter informing them that the bank had "inadvertently" reported that they had filed for bankruptcy to the four major credit bureaus. 

A report of a bankruptcy filing can impair your credit, and such a report at a critical juncture could cause another financial institution to reject your application for a car loan or mortgage on a home.

In the case of a home mortgage, a negative report from a credit bureau could mean losing your financing, and at a time when the housing market is tight, it could mean losing a home to another offer by a party with unimpaired credit.

The bank claims it has "fixed" the issue and all of the credit reporting agencies have been informed of the error. If you have received such a letter, you should check with all of the agencies and check your credit report to ensure that the error is in fact fixed.

And for those who have filed a bankruptcy, remember that while a bankruptcy may limit some types of credit you may be able to obtain, you can rather quickly begin to rebuild your credit health and your credit score after a bankruptcy. 

Source: WLWT.com, "5/3 Bank accidentally reported some customers as filing for bankruptcy," February 12, 2014

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For sound bankruptcy advice you can count on, from a skilled lawyer who truly cares about your future, contact the Louisville Law Office of Allan E. Dunaway, PLC. We have two convenient locations: Louisville, Kentucky, and Jeffersonville, Indiana. Our main office in Louisville is located off the beaten path so you won't have to deal with downtown traffic and can pull right up to our door and walk right in.

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