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?
Hi texaslady,
I would suggest you to contact your second lender and apply for a loan modification. If the lender accepts it, then it would help you save your property. If you do not contact the lender right away, the second lender will have the rights to foreclose the property. However, they generally do not do it as they would become liable to satisfy the first mortgage lender. Hence, they can charge off the loan to collections.
Thanks
I would suggest you to contact your second lender and apply for a loan modification. If the lender accepts it, then it would help you save your property. If you do not contact the lender right away, the second lender will have the rights to foreclose the property. However, they generally do not do it as they would become liable to satisfy the first mortgage lender. Hence, they can charge off the loan to collections.
Thanks
My debt has been forgiven/ and or Cancelled; Can a creditor report it as still owing to the credit bureau, i.e. a"Charge/ Off debt"? Thank You
My debt has been forgiven/ and or Cancelled; Can a creditor report it still owing to the credit bureau, i.e. a "Charge/Off "? Thank You
if it was charged off, then it can certainly be reported as such. what type of debt was this, roy? and please explain the forgiven aspect of it...i don't quite get the concept. as for a cancelled debt - i'd think that means the creditor denies now that it ever existed?
My original loans were student-loans, that I received a medical cancellation on, forgiving and discharging my debt (in writing! ) Then my former creditor reports to the credit bureau that I still owe the debt by charging- it -off, and that they are in collections! My question is "are my debts discharged and cancelled, or are they charged-off and still owing"? They can't have it both ways! Thank You
i agree with you...have you ever tried to marry the documentation you got for the medical cancellation and passed it along to the bank? i don't get what you're describing, but it occurs to me that if the two of them see hwat've you've done with house, it'd serve you better.
Hi Roy,
Your debts can be discharged only if you had filed bankruptcy. I don't think you've filed bankruptcy. I guess, your lender had charged off the loan and thus a collection agency will now collect the dues from you. If you can't pay it off, the collection agency can file a law suit against you.
Your debts can be discharged only if you had filed bankruptcy. I don't think you've filed bankruptcy. I guess, your lender had charged off the loan and thus a collection agency will now collect the dues from you. If you can't pay it off, the collection agency can file a law suit against you.
wow...was i asleep when i wrote my last comments? they make as much sense as a lot of the others, i suppose, but not to me. i was trying to suggest he take his "cancellation" and provide it to the credit agencies that are reporting the charge-off, as well as to the creditor that's being reported.
i don't think that message seeped through.
i don't think that message seeped through.
My truck is showing as a chargeoff on my credit but I have got cps to give me a settlement off but they are still reporting this as a charge off I'm paying the truck off at a lesser balance. The balance is 14365 and only paying towards a balance of 4250. I just need to know how should I go about gettin them to report this on my credit report. I'm trying to get approved for a home loan and this is making it impossible. Can u give me some advice?
I have a charge off on my credit report from cps. My truck has never been repossed. They have it listed on my credit report like that. I'm currently paying towards a bal of 4250 instead of the total amount being 14568. What can i ask cps to do to report this as a paid or paid as agreeded each month on my report
juan, i think you'll have some difficulty with this; you're paying off based on a lower amount than you actually borrowed. but cps lost money in the deal - and they undoubtedly wrote off the difference between your new negotiated amount and the old one. i doubt they'll change the report.
In 2001 my boyfriend and I had our vehicle repossessed. He filed bankruptcy and I didn't now its 2009 and I wanted to purchase a home. I pulled my credit report and noticed the vehicle was stated as a charge off/ bad debit. Now it has been eight years since am I still responsible to pay off the loan or does the SOL come into play and I can write a letter to the the three credit breaus to have it removed?
what was the date of the charge off as reported bridgit?
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1) a class assignment, like a term paper; or
2) an assignment to a specific school, such as St. Mary of the Plains or Azusa Pacific.
but i'm gratified that wb themes (warner brothers themes? like cartoons?) is happy.