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?
undoubtedly the account was charged off prior to your settlement. therefore, the credit report is correct in showing it that way, because your creditor reported it to them. the only way to eliminate that citation is to discuss it with the creditor involved, and ask that they remove the notation of "charge off." keep in mind that they don't need to do so.
i'm sorry that i can't tell you how much of a hit on your credit score you take for this. perhaps someone else....
i'm sorry that i can't tell you how much of a hit on your credit score you take for this. perhaps someone else....
Thank you for your reply. I have a letter from the creditor that states this was paid. Will this help to remove it from my credit report?
Hi Guest!
Welcome to the forums!
You can submit the letter to the credit bureau and update the status of your credit line. However, any negative item would remain in your credit report for 7 years. Before that, I don't think this will get removed from your credit report.
Feel free to ask if you've further queries.
Sussane
Welcome to the forums!
You can submit the letter to the credit bureau and update the status of your credit line. However, any negative item would remain in your credit report for 7 years. Before that, I don't think this will get removed from your credit report.
Feel free to ask if you've further queries.
Sussane
I am currently dealing with my husbands nasty credit reports. He has one <charged> that states it's been sold to a collection companY. On our transunion report is states <estimated> this date is Sept. 2009. We also received a notice on June 28, 2009 from the collection agency there balance is almost double of the original amount but settlement offer is approx. the same as the original debt.
My question. should I pay off this debt even though it's suppose to be removed in a couple of months? and once it's removed from his credit report is it GONE FOR GOOD OR WILL IT COME BACK TO HAUNT US??
we really want to apply for a mortgage but I'm afraid that paying it off won't make a difference!
My question. should I pay off this debt even though it's suppose to be removed in a couple of months? and once it's removed from his credit report is it GONE FOR GOOD OR WILL IT COME BACK TO HAUNT US??
we really want to apply for a mortgage but I'm afraid that paying it off won't make a difference!
Hi wannafixit,
It is always better to pay off the debts as it will help you in keeping your credit clean. However, if you are unable to pay off the debts, then you need to check out the SOL period that is applicable in your state. If you find that the SOL period will expire within a few months, then it would be better if you do not pay the debts and let it get removed from your reports.
It is always better to pay off the debts as it will help you in keeping your credit clean. However, if you are unable to pay off the debts, then you need to check out the SOL period that is applicable in your state. If you find that the SOL period will expire within a few months, then it would be better if you do not pay the debts and let it get removed from your reports.
statute of limitations isn't what affects credit reporting - that's regarding legal issues. credit agencies maintain derogatory records for 7 years. i saw nothing in your post, wannafixit, that the 7 year period was nigh.
you mentioned two 2009 dates, but nothing earlier.
you mentioned two 2009 dates, but nothing earlier.
I have two charge offs on my credit report. Although I paid it off through the collection agency, its show negative on my report 4 times. 2 for the initial debt and 2 times where it shows it was sold and paid. What can I do? :?
Hi Yummiepr
If you've paid off the dues to the collection agency, you must be having documents related to that. You should contact the credit bureaus and ask them to update the information in your credit report.
Thanks.
If you've paid off the dues to the collection agency, you must be having documents related to that. You should contact the credit bureaus and ask them to update the information in your credit report.
Thanks.
We have a credit card that the last payment made was in 2003. It now shows as a charge off. We have a collection agency that just started hounding us the last couple weeks and I am under the understand that they can't do anything because the SOL in Missouri is 5 years. Can I get this charge off removed from my credit report? Thank you.
Hi cmiman!
Welcome to forums!
You will have to first check out when your credit card debt was charged off. This will help you in determining whether or not you are within the SOL period. If the SOL period is over, then the collection agency cannot harass you. As far as removing the charge off from your credit report is concerned, it will remain as a negative item on the report for 7 years.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
You will have to first check out when your credit card debt was charged off. This will help you in determining whether or not you are within the SOL period. If the SOL period is over, then the collection agency cannot harass you. As far as removing the charge off from your credit report is concerned, it will remain as a negative item on the report for 7 years.
Feel free to ask if you've further queries.
Sussane
to determine the law, you may want to contact your state attorney general's office.
I have charge off items on my credit report. I was reviewing my credit report last nite. It says they well be removed 2011-2013. I'm not sure if I should just wait or file for bankruptcy? please help. I'm confused
Hi ladyducky!
Welcome to forums!
Why do you want to file bankruptcy? Is it because of the charge off accounts on your credit report or do you have other debts? It would be easier for me to answer your query if you could give some more details.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
Why do you want to file bankruptcy? Is it because of the charge off accounts on your credit report or do you have other debts? It would be easier for me to answer your query if you could give some more details.
Feel free to ask if you've further queries.
Sussane
i don't get the jump from having old charge offs on a credit report to a filing for bankruptcy. as sussane noted, we need far more detail from you, ladyducky, to give you any reasonable answers.
I still have a charge off on my transunion after 8 years; howdo i get it off.