Established Contributor
Posts: 761
Registered: ‎10-16-2007

CO and Collection from Capital one

Im confused I thought that a account can only show as a chargeoff if they didnt sell the account to a collection agency. So I have a charge off from capital one on my report as well as a collection from the same account is this legal? Im sure Im taking a point hit on this.

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Established Contributor
Posts: 512
Registered: ‎02-27-2012

Re: CO and Collection from Capital one

A CO means that the OC took a loss on the account. That doesn't mean that the debt isn't valid.

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Moderator Emeritus
Posts: 32,869
Registered: ‎08-04-2007

Re: CO and Collection from Capital one

Both a CO and a CA can report, though only one can report a balance.

Mega Contributor
Posts: 19,518
Registered: ‎03-19-2007

Re: CO and Collection from Capital one


A charge-off is a business accounting measure that reflects the creditor's statement at that point in time that the bad debt is now considered "uncollectible."

They can thus move it from a receivable (taxable) asset to a business writeoff.

The subsequent status of the debt is irrelevant to the fact of the CO.  If the OC laters collects some of the charged-off debt, they reconcile that with the IRS in their accounting of receivables.


The entire amount of the charged-off debt is still due to the owner, and they may pursue collection of the entire amount, as long as they still own the debt.

As far as the consumer is concerned, the act of a prior charge-off has no effect on the full debt, or the authority of anyone to continue to attempt to collect it.

If a debt collector becomes involved, either as an assignee of the creditor or the owner, they are entitled to collect on the full amount, and report those collection efforts to the CRAs.  The owner reports the debt owed, and the debt collector reports the debt they are collecting upon.  If the debt collector buys the debt, their reporting reflects both.

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