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?
did americredit give you a reasonable explanation for why they wanted your information? are you certain the loan was transferred to a collection agency?
i have a rental property that has fallen into foreclosure for many reasons. After the sale, there will definitely be a balance due. Will the mortgage company at that point want to settle for less than the balance?
Hi anonymouscleve,
You can negotiate with the lender and check if he is ready to settle for something less than the balance due. You should note that it would be the discretion of the lender whether he would agree to it or not.
Thanks
You can negotiate with the lender and check if he is ready to settle for something less than the balance due. You should note that it would be the discretion of the lender whether he would agree to it or not.
Thanks
I have a visa charge off from 5 years ago that I absolutely don't remember. It was a $150 balance that I guess I literally forgot about. Now I have been charged off and sent to collections. Can I negotiate with the collection agency to have the Visa charge off removed? Or do I need to negotiate with Visa? Basically, what is my best course of action to get this completely removed from my credit history?
Hi Guest,
Any negative item will remain on your credit report for 7 years. However, I would suggest you to contact VISA and negotiate with them. You can ask them to take back the account from collections. Once your account is removed from the collections, you can pay off the amount.
Thanks
Any negative item will remain on your credit report for 7 years. However, I would suggest you to contact VISA and negotiate with them. You can ask them to take back the account from collections. Once your account is removed from the collections, you can pay off the amount.
Thanks
So the collection agency cannot remove the Visa charge off?
Hi Guest!
Welcome back to forums!
As far as I know, a collection agency would not be able to remove the charge off from the credit report. Once you negotiate with your creditor and pay off the dues, then you can ask your creditor to contact the credit bureaus and try to remove it from your credit report.
Feel free to ask if you have further queries.
Sussane
Welcome back to forums!
As far as I know, a collection agency would not be able to remove the charge off from the credit report. Once you negotiate with your creditor and pay off the dues, then you can ask your creditor to contact the credit bureaus and try to remove it from your credit report.
Feel free to ask if you have further queries.
Sussane
Can A creditor still file a charge off even when they are accepting payments? We are one month behind but still making full payment and trying to pay a little more if we can, and we just recieved a letter that we are going to be charged off. Can they do that?
Mostly creditors charge off the loan, if you are delinquent on your payments. I guess, the lender has charged off the loan because you are one month past due on your payments.
have 2000 pounds owing on credit card and am waiting for payment from tax to pay off what can they do if i have moved to another country
Hi silly!
Welcome to forums!
They cannot garnish your wages in the other country or place lien on your property situated there. However, they charge off your account to a collection agency.
Sussane
Welcome to forums!
They cannot garnish your wages in the other country or place lien on your property situated there. However, they charge off your account to a collection agency.
Sussane
I recieved a "warrant in debt" (civil claim for money) concerning a credit card account that was charges off in April of 07. This can from a collection agency, Carmel Holdings, LLC). The original holder is HSBC. Can the collection agency legally sue me for the charged off debt. If so, who do I negoiate with to pay the debt? What percentage should I try to settle the debt for? Thanks for your comments!
Hi Hilton,
Yes, the collection agency can sue you for the charged off debt. You can contact the customer care department of the collection agency and negotiate with them. As far as the percentage of the debt is concerned, it will depend upon how much you are able to pay. However, you should note that the collection agency is not liable to accept your request for a low payment.
Thanks
Yes, the collection agency can sue you for the charged off debt. You can contact the customer care department of the collection agency and negotiate with them. As far as the percentage of the debt is concerned, it will depend upon how much you are able to pay. However, you should note that the collection agency is not liable to accept your request for a low payment.
Thanks
5 years ago we had our vehicle repoed, we were notified about the amount the vehicle was auctioned off for and our remaining balance we owed. we paid $110.00 per month for over a year. we refinanced our home to get the money to pay off 90% of the remaining balance, we were told that our debt would be considered paid off if we would come up with 90%. so we paid the 90% and they sent us a note stating that they would update the credit bureaus and our debt was paid in full. well, months later i check our credit report and the debt is showing charge off/bad debt and now they are reporting the balance that the vehicle was auctioned off for, which i thought was to go toward your debt. i contacted the credit bureaus and the company is still stating that the debt owed is correct. there should be no debt, it's been paid off. when i contact the company to speak to them about this matter, they have no information on our account, they say it can not be found. yesterday my husband and i tried to apply for a refinance on our home and there is the repo to haunt us again. the debt has been paid since may 25, 2005, but they are still reporting that it is not paid off. i hate the looks people give us when they see the repo on our credit, it was a medical reason we got behind and the finance company was not willing to work with us until we were so far behind and even then they would only defer one payment, ha lotta good that would have done being several months behind.
Need a little help with charge offs.
I was behind on my mortgage for 4 months or more and finally was able to settle on a short sale. Now that the sale is complete, how does the "charge-offs" affect my credit? My charge offs are at 0 balance. Do i need to contact my bank and have them remove this or how does it work for short sales? Will the bank still come after me for funds that were not paid but was settled on a short sale? When i check my credit report, i see "charge offs" on both the loans. Thanks
I was behind on my mortgage for 4 months or more and finally was able to settle on a short sale. Now that the sale is complete, how does the "charge-offs" affect my credit? My charge offs are at 0 balance. Do i need to contact my bank and have them remove this or how does it work for short sales? Will the bank still come after me for funds that were not paid but was settled on a short sale? When i check my credit report, i see "charge offs" on both the loans. Thanks