Posted on: 24th Nov, 2005 12:39pm
When you're unable to pay off a debt, the creditor may issue a credit charge off. A charge off doesn't mean that the debt is cancelled or forgiven. It's not that you no longer owe the debt. Credit charge off implies that the unpaid debt will be reported as the creditor's loss when he uses accounting methods for tax purposes.
The creditor may feel that he cannot collect the debt from you; he may write off the account as a bad debt. But he doesn't lose the right to collect the debt. And, even if the creditor does not try to collect an unsecured debt (like credit card, personal loan, etc), he may sell it off to a collection agency (CA), which will then set off to collect the debt.
The creditor may feel that he cannot collect the debt from you; he may write off the account as a bad debt. But he doesn't lose the right to collect the debt. And, even if the creditor does not try to collect an unsecured debt (like credit card, personal loan, etc), he may sell it off to a collection agency (CA), which will then set off to collect the debt.
How to remove charge off from credit report
Usually credit charge off occurs when payments aren't made for more than 6 months. And, it does have a negative impact on your credit report as it stays on the report for 7 years and 180 days from the date of first non-payment of debt. So, what you need to do is, negotiate with the collection agency and try to remove the charge-off from your credit report.
If the creditor has charged off your loan recently, then request him to pull back the debt from the collection agency. Explain that you wish to deal with the creditor directly. Once the debt is pulled back, you can negotiate with creditor to settle the debt for as much as you can pay. You should also negotiate a pay for delete agreement such that even though you don't pay mortgage balance in full, the lender would communicate with the bureaus and have all information on the account removed from your report. If the creditor doesn't want a pay for delete agreement, then request him to update your account status as "Paid charge off".
However if you try to settle the debt by making a partial payment, then the creditor may report it as "Settled Charge off". A "Paid" or "Settled" charge off on a mortgage debt helps to remove the lien from the house title.
If the creditor has charged off your loan recently, then request him to pull back the debt from the collection agency. Explain that you wish to deal with the creditor directly. Once the debt is pulled back, you can negotiate with creditor to settle the debt for as much as you can pay. You should also negotiate a pay for delete agreement such that even though you don't pay mortgage balance in full, the lender would communicate with the bureaus and have all information on the account removed from your report. If the creditor doesn't want a pay for delete agreement, then request him to update your account status as "Paid charge off".
However if you try to settle the debt by making a partial payment, then the creditor may report it as "Settled Charge off". A "Paid" or "Settled" charge off on a mortgage debt helps to remove the lien from the house title.
SOL and credit charge off
As long as the SOL (Statute of Limitations) period exists, the creditor/collection agency can file a lawsuit against you and try to retrieve the unpaid debt, even after charge off. But after the SOL period (4 to 6 years, varies from state to state) expires, there'll be no lawsuit against you but the creditor or collection agency still has the right to collect from you. However, if debtors make a written promise to pay off the debt or make partial payment after the SOL expires, then in many states, the SOL starts over again.
If you have a charge off on your credit report and wish to get a mortgage, the lender would expect you to pay it off and then go for the mortgage. This is because a mortgage charge off implies there is still a lien existing against the title and the lien can only be removed once it is paid off.
If you have a charge off on your credit report and wish to get a mortgage, the lender would expect you to pay it off and then go for the mortgage. This is because a mortgage charge off implies there is still a lien existing against the title and the lien can only be removed once it is paid off.
Can I get some information on Charge Offs?
anyone with any insight on this issue?
You can get approved by FHA BUT FHA has a few guidelines you may have to meet. Also, there's a lot of lenders that a minimum credit score requirement which is 580.
Have you been late in the last 12months for any credit accounts?
What major derogs do you have? (BK, foreclosure, collections, judgements, etc)
Have you been late in the last 12months for any credit accounts?
What major derogs do you have? (BK, foreclosure, collections, judgements, etc)
I keep getting a call from a collection agency stating that I owe for a Montgomery ward credit card dept dating back to 1996. The account was charged off and had been off my credit report. I have no plans to pay this dept because it is so old and I have never gotten any bills from any collection agencies since 1996. Should I worry about going to court and having to pay this dept.
Hi Dee!
Welcome to Forums!
Charge off does not mean that your mortgage has been wiped off. It only means that the original lender has given up on your loans and has sold to it to a collection agency who will ask you to pay the loan. I think you are facing this situation. Try and pay off your debts.
Welcome to Forums!
Charge off does not mean that your mortgage has been wiped off. It only means that the original lender has given up on your loans and has sold to it to a collection agency who will ask you to pay the loan. I think you are facing this situation. Try and pay off your debts.
Dee, I wouldn't pay an account that old, it will show back up and start re calculating for another 7 years,,if it's already on there, ask if you pay it if they will delete it..it they agree,,get it in writing 1st.
i got an auto loan about three years ago from Americredit. i paid on it, and my account was "ok" for awhile. i had surgery two years ago, and subsequently lost my job. the company charged off the account after i was late in paying (90 days). i moved up north, and got another job, and things are alot better. the company i received the auto loan from has stopped my ability to pay online. i know if i try to call them, they will want an unreasonable amount of money "up front." i have two kids and cannot afford to give over "everything" i know Americredit will want, and we were on the verge of being homeless before every other week. it has been difficult to recover. i don't want to get sued, but i don't know how to (or where to go) to clear this thing up. how can i find someone who will know what to do?
Hi anonymous!
You said that Americredit has charged off your loan. This means Americredit is no longer your lender. It has sold off the debts to a collection agency who will receive the dues from you. You can contact Americredit and know about the collection agency to whom they have charged it off. Then you can contact with the collection agency and pay off the dues.
Thanks,
Jerry
You said that Americredit has charged off your loan. This means Americredit is no longer your lender. It has sold off the debts to a collection agency who will receive the dues from you. You can contact Americredit and know about the collection agency to whom they have charged it off. Then you can contact with the collection agency and pay off the dues.
Thanks,
Jerry
NATIONSTAR was the original creditor, who wasted time doing a plan for me through a realtor who bought the house from up under me. My report shows that I owe over 50K to PINNACLE CREDIT. The house was sold so what am I to do.
Hi gterrel!
I think the sale of the property was not reported to the credit bureau. You can contact the credit bureau and report the sale of the property. You can also contact Pinnacle Credit and inform them about the sale of the property.
Thanks.
I think the sale of the property was not reported to the credit bureau. You can contact the credit bureau and report the sale of the property. You can also contact Pinnacle Credit and inform them about the sale of the property.
Thanks.
can a recent charge off and a new collection for the charge off exist on your credit report. I had a charge off in Dec 2008 and now i have a colleciton agency that reported the same thing on my credit report how can i dispute this or take this off my credit report
Hi ginam,
If a particular charge off is reported twice in your credit report, you can contact the credit bureau and try to remove it. You can also contact your collection agency who can directly speak to the bureaus and get it removed.
Thanks
If a particular charge off is reported twice in your credit report, you can contact the credit bureau and try to remove it. You can also contact your collection agency who can directly speak to the bureaus and get it removed.
Thanks
ginam, let me get this straight. you didn't pay your credit card bill, so they charged off the account. right?
subsequently, they decided to obtain the services of a collection agency to try to get the debt paid. right?
now...both the credit card company and the collection agency show up as creditors on your credit report. the credit card company can actually close its books on this account if it so chooses. the reality of it, of course, is that you still owe the amount shown.
as for the collection agency, they'll continue to report your balance due until that balance due goes away.
if you have not repaid the debt, there is no reason for either of these companies to "remove" the references on your credit report.
once you make payment in full, your credit report should reflect that these accounts have been paid in full. there's no reason why they would necessarily remove the references altogether (though they could if they wished).
subsequently, they decided to obtain the services of a collection agency to try to get the debt paid. right?
now...both the credit card company and the collection agency show up as creditors on your credit report. the credit card company can actually close its books on this account if it so chooses. the reality of it, of course, is that you still owe the amount shown.
as for the collection agency, they'll continue to report your balance due until that balance due goes away.
if you have not repaid the debt, there is no reason for either of these companies to "remove" the references on your credit report.
once you make payment in full, your credit report should reflect that these accounts have been paid in full. there's no reason why they would necessarily remove the references altogether (though they could if they wished).
Hi i had a creditor card charge off in 2005, a few days ago i recieved a collections notice from NCO financial systems, should i pay this old debt or just ignore it?
Hi willhas,
It would be good if you could pay off the credit card debt now. This will have a positive effect on your credit report.
It would be good if you could pay off the credit card debt now. This will have a positive effect on your credit report.
I've called Americredit, and they will not tell me what collection agency my auto loan went to. All they want is "what is your address, where do you work? what is your job title?" I want to take care of this. I even got a copy of my credit report online, and nothing shows up there. Any ideas?