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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?

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Established Contributor

Re: Creditor Won't Charge-off Debt

I don't think there is any law that says a creditor HAS to charge off debt. Most creditors charge it off simply for tax purposes, they can take a write off for the debt.


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Senior Contributor

Re: Creditor Won't Charge-off Debt

 

Locking thread, due to similar thread found here. http://ficoforums.myfico.com/t5/Mortgage-Loans/Creditor-Won-t-Charge-Off-Debt/m-p/2054077

 

OP, To avoid confusion-Please refrain from making duplicate posts.Lightnin, myFICO Moderator

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