GN 02201: General Information Title II, Title XVI, and Title XVIII Overpayments - Part I
TN 23 (02-02)
A. Policy - general
1. Authority
The Domestic Employment Reform Act of 1994 (DERA) authorized SSA to report certain delinquent title II overpayment debts to credit bureaus. The Debt Collection Improvement Act of 1996 (DCIA) gave SSA permanent authority to continue credit bureau reporting.
In addition, the Fair Credit Reporting Act (FCRA) contains provisions on credit bureau reporting, including provisions on handling consumer disputes about information reported to credit bureaus by SSA and other credit reporting entities (see GN 02201.032D.2.)
2. General description of credit bureau reporting
Credit bureau reporting is the posting of a debt to an individual's credit record. SSA uses credit bureau reporting as a way of influencing a debtor to repay a title II or title XVI debt.
SSA sends information about the debt/debtor to the national credit repositories, which are the largest holders of credit data. The credit repositories then provide the information to the smaller credit bureaus across the country. An SSA debtor could be denied a loan or credit based on the posting of an unrecoverable SSA debt on the credit report.
NOTE: See SI 02220.014 for information regarding reporting title XVI debts to the credit bureau.
3. Criteria for selecting title II debts for credit bureau reporting
SSA's automated systems select certain delinquent title II debts for credit bureau reporting. The following criteria apply:
The debt must have been paid to a person after that person attained 18 years of age;
The debt must be considered to be “unrecoverable” under regulations issued by the Commissioner of Social Security (see GN 02201.031B for definition of the term “unrecoverable”);
The debt must be owed by a person who is no longer entitled to receive Social Security benefits;
The debtor must be alive;
The debtor's BOAN must be on the MBR,
The debt must be $25.00 or more, and
The debt must be delinquent for no more than 6 years and 6 months (see GN 02201.030B.2. for the definition of the term “delinquent”).
Note: Based on these criteria, SSA does not report BIC “C" debtors to credit bureaus.
B. Process
1. Debtor selection
Each month, SSA's systems select title II debtors who reach unrecoverable status for credit bureau reporting.
NOTE: If the debt has not been reported to the credit bureau, the presence of a KTAC would prevent it from being reported.
2. Debtor notification
SSA sends due process notices to the selected debtors, telling them that SSA intends to report their debts to credit bureaus. The notices tell the debtors that the following specific information will be reported:
Debtor's name, address and Social Security Number;
Date of birth;
Date the overpayment became delinquent (see GN 02201.030B.2. for definition of the term “delinquent”);
Date of last payment, if any; and
Past due balance of the overpayment.
NOTE: SSA sends one notice to inform the debtor about the proposed credit bureau reporting and administrative offset of Federal payments. The same repayment options and due process rights described in GN 02201.031C. are offered for credit bureau reporting and for administrative offset. All ECO notices sent November 2015 or later will be stored in ORS. For all ECO notices sent prior to November 2015 you can view the ECO master query. For additional information on the ECO master query, see MSOM DMS 014.007.
3. Credit bureau reporting
If all criteria for credit bureau reporting continue to be met, SSA's systems report the debtor/debt information after the later of:
The expiration of 60 days from the date of the notice, or
The date on which SSA sends the debtor a decision on any request for review of the debt or waiver received during that 60-day period.
4. Updates to credit bureau reports
SSA is required to keep its debtor/debt information updated with the credit bureaus. SSA's systems perform the updates each month. SSA reports new information such as repayments, changes of address, and protests received after the debt is reported to the credit bureaus.
NOTE: If a debtor becomes reentitled and benefit withholding resumes, SSA's systems will automatically update the credit bureau with the collections and the most current debt balance.
C. Handling debtor inquiries/protests during 60-day due process period - procedure
Shortly after selecting the debtors, SSA sends each individual a notice about the planned action(s). Among other things, the notice informs the debtor:
That he or she owes a delinquent overpayment debt in a particular amount;
That SSA plans to refer the debt to Treasury for TRO/TOP and/or send information about the debt to credit bureaus after 60 days have expired from the date on the notice;
That SSA will not take this action if, before the end of that 60-day period, the debtor pays the debt in full, makes regular installment payments under an agreement with SSA, requests waiver, or furnishes evidence showing that he or she does not owe all or part of the stated amount or SSA does not have the right to collect the debt; and
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That the debtor may review and copy SSA's records about the debt.
Debtors will react to the 60-day due process notice in a variety of ways. This section provides the procedures for how to handle the debtor reactions most likely to occur after the due process notice is sent and before the debt is reported to the credit bureaus.
1. Request for explanation of overpayment
Follow procedure in GN 02201.030D.1.
2. Request for Waiver
Follow procedure in GN 02201.030D.2.
Note: If a waiver request is pending at the end of the 60-day due process period, the debt will not be reported to the credit bureaus
3. Request to inspect SSA's records
Follow procedure in GN 02201.030D.3.
4. Request for installment payments
Follow GN 02201.030D.4.
5. Debtor objects to collection of debt
a. Protest involves request for review of the debt or the legality of collection
If the debtor alleges that he or she does not owe all or part of the balance stated in the notice or that SSA has no legal right to collect the debt, advise that if he/she wishes us to review these findings before we report the debt to the credit bureaus, we must receive evidence to support the allegations within 60 days from the date of the due process notice. Follow GN 02201.030D.5. to review any evidence/statements.
b. Protest involves the fact and/or amount of overpayment
Follow the procedures in GN 02201.030D.5.d.
6. Debtor alleges nonreceipt of overpayment
Follow procedure in GN 02201.030D.6.
7. Debtor makes a compromise offer
If the debtor makes a compromise offer, process in accordance with existing instructions in GN 02215.100 through GN 02215.125. If SSA agrees to the offer, stress that payment must be received by us before the 60-day due process period expires or we will report the debt to the credit bureaus.
8. Debtor alleges nonreceipt of initial overpayment notice
Follow the procedure in GN 02201.030D.8. When forwarding material to PC, annotate as “Necessary Action—TOP/Credit Bureau Reporting Case—Do Not Backlog.”
9. Report of death
Follow procedures in GN 02201.030D.9.
10. Report of bankruptcy action
Follow procedures in GN 02201.030D.10.
D. Handling debtor inquiries/protests after credit bureau reporting - procedure
Generally, inquiries and protests received after the debt has been reported to the credit bureaus will be handled according to normal processing. SSA's systems will automatically pass information about the inquiries/protests to the credit bureaus. Once a debt has been reported, it will remain on the debtor's credit record (with a few exceptions as explained below). The debt/debtor information, such as the most current debt balance and last payment, will be updated as necessary by SSA's systems.
1. Consumer disputes report with the credit bureau
Consumers have the right to dispute the accuracy of information about them reported to credit bureaus, including information reported by SSA. In some cases, consumers will dispute the accuracy by contacting the credit bureaus directly. This will most likely occur after the debtor has received a copy of his or her credit report and sees that information reported by SSA has been posted to the report. The consumer dispute will concern the amount or the fact of the debt.
When the credit bureau is notified by the consumer of the dispute, it will contact SSA and request that we verify our records of the debt. The contact will occur via an online system called the Automated Consumer Dispute Verification (ACDV) system, which links the credit bureaus with SSA. (Currently, the ACDV process is handled by the NEPSC.) Under the provisions of the Fair Credit Reporting Act, we have 30 days to respond to the dispute or the debt is deleted from the credit report. In most cases, SSA need only verify the fact or amount of the debt on the MBR/ROAR and notify the credit bureau via the online program that the debt is correct as reported.
Important: Do not process the consumer dispute as a request for reconsideration of the fact/amount of the debt. Requests for reconsideration of the fact/amount of the debt must be made directly to SSA and should be handled as described in GN 02201.030D.5.
2. Allegation of pending protest or waiver request
If a debtor alleges that he/she filed a protest or requested waiver before or during the 60-day due process period but never received a decision, obtain a ROAR query and proceed as follows:
If there is a 23W or 23R posted before or during the 60-day due process period but no decision has been made and released:
Notify the program analyst that the debt should be deleted from the credit report.
Tell the debtor that the debt will be removed from the credit report.
Look for an SSA-632-BK, a letter from the debtor or his/her representative or a Form SSA-795 in FO records or in the claims folder.
Process the waiver/protest in accordance with GN 02201.034 or GN 02201.036.
If ROAR reflects an unfavorable reconsideration or waiver decision before or during the 60-day due process period:
Advise the debtor that since the issue has been resolved, credit bureau reporting was appropriate.
Do not delete the debt from the credit record.
If there is no ROAR posting but the debtor still indicates a prior protest/waiver was filed:
Look for an unprocessed SSA-632-BK, letter or SSA- 795 in FO records or in the claims folder.
Also look in REMARKS or the Special Message field for indications that a waiver was requested but not posted to the system. If you find evidence of a prior protest, proceed as follows:
Notify the program analyst that the debt should be deleted from the credit report.
Tell the debtor that the debt will be removed from the credit report.
Post the pending request to ROAR via the DRPR screen.
Process the waiver/protest in accordance with GN 02201.030D.
If the records review fails to produce any evidence of a protest or waiver filed before or during the 60-day due process period, notify the debtor that the reporting was correct. Ask if the debtor wishes to file a new waiver request. If so, follow GN 02201.030D.3.
3. Request for waiver
If a request for waiver is received after the 60-day due process period and the debt has been reported to the credit bureau, proceed as follows:
Obtain an SSA-632-BK in accordance with current instructions in GN 02250.002 and GN 02250.200.
Advise the debtor that the waiver will be processed as soon as possible but that the debt will remain reported to the credit bureau. If the debt is eventually waived, SSA will update the credit report to show a balance of zero.
4. Request for installment payments
Establish the agreement per GN 02210.180.
Advise the debtor the debt will remain reported to the credit bureau but that SSA will update the balance to reflect the most recent repayment.
5. Report of bankruptcy
If debtor alleges a bankruptcy petition was filed and the debt was discharged, request evidence of proof of the discharge. If proof is received, inform the debtor the debt will be removed from the credit report. (See GN 02215.190 - GN 02215.235.)
If the debt is discharged without exception, call or email the Program Analyst that the debt should be deleted from the credit report.
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