here's what probably happened. your original creditor sold the debt to Ditech for cents on dollar and wrote off the balance which has no effect on Ditech's ability to collect from you. If Ditech did in fact issue you a 1099-C in 2016, I would agree they should not be docking your refund. The IRS will probably say it ain't our problem. your only recourse would be to consult a lawyer.
