Legal Question in Consumer Law in North Carolina

I paid my rent online via an E-Check. Upon balancing my checkbook, I noticed these monies had not been taken out and I called the rental agency to ask why the check had not cleared as it had been several days since I'd paid. I was then informed that the check had been returned for INSUFFICIENT FUNDS. I Immediately informed them that there were indeed funds in my account to cover the check and was then told that if this was the case, then I must have entered the account number incorrectly, and either way, must pay the late fee and full rent. I paid immediately, even though I asked for proof of where I entered the account wrong and this could not be provided to me. I then called my bank and was told there had been no attempt to draft any money from my account and I had no fees associated with a bad check. I called the rental agency back to report this and they still said there was nothing they can do. At this time, I'm moving and when I applied for another home, I was told that my rental history showed that I had a late payment due to an insufficient check. My question is this: How can this company report that I paid with an insufficient check when they never went into my account to attempt to draft any funds?? IF there was an error in me typing the routing and account number, then that is clearly not the same as saying I wrote a check and didn't have funds to cover it. Is this legal? This is a negative impact on my rental history, the only negative mark I have. I want it gone. What can I do?


Asked on 3/18/15, 12:01 pm

1 Answer from Attorneys
Lynn Coleman Attorney-Mediator

In my opinion, if you did not pay the rent on time because you made an error putting in your account number, the error is on you and you did pay your rent late. The report that you did pay your rent late is an accurate report. What is not technically correct is the reason, but the reason is probably due to the limits of the system the rental agency put this in. The rental agent tried to deduct your rent, but it got kicked back and the code the agency got was probably insufficient funds rather than "closed account", "false account", or some other reason when someone puts in an account number that does not belong to them into a payment system. These kind of reports don't necessarily have to include the consumer's intent or lack thereof.

You can learn about specialty reporting agencies here (I do not vouch for this site but at first glance it seems like a pretty comprehensive summary) https://www.privacyrights.org/other-consumer-reports-what-you-should-know-about-specialty-reports and here is a link to the CFPB's information: http://www.consumerfinance.gov/blog/you-have-a-right-to-see-specialty-consumer-reports-too/

You should ask your current agency where the report they got came from and ask for a copy of the report. At a minimum, you should be able to include a consumer explanation. I doubt you can get this removed completely because the report is accurate - your rent was late due to a problem with your payment. I don't know which of either one - the check was returned due to insufficient funds, or the check was returned because you provided a false account number - would be preferable to you to show on this report.

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Answered on 3/19/15, 10:07 am


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