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Creditor Won't Charge-Off Debt

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Creditor Won't Charge-Off Debt

I have a client that has mortgage loan that was sold to a mortgage collection company and the mortgage collection company is stringing 120 day late payments along and they won't charge-off the debt even though is has not been paid in a couple years. Isn't there federal regualtion that requires them to charge-off the account? Can they continue to post 120 late payments on the account as if they account is open? If anyone has any more information or dealt with this please let me know. Thanks. 

1 REPLY
Valued Contributor

Re: Creditor Won't Charge-Off Debt

No regulation that I know of.

Creditors, Lenders, can either write the loan off or keep on their books, I believe it is totally their choice.

If you have no plans to repay it, then it will come off your credit reportsin 7-71/2 years from the time it was first reported.
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