Can I fix this Charge Off?

[SSPA87]

Last year a bank account went into the negative. When I received a letter offering a pay back plan, I paid the account off in 3 payments. Was paid off by March 2016. Was told account could be reopened. I chose not to since I have no local branches.

This weekend I received a credit alert that I have a Charge Off from the bank! I'm furious & very upset. I'd finally gotten a clean report after an ex had royally ruined it. Now I have a charge off showing that I'd already paid!

Is there anything I can do to get this removed? I was so flustered when I called customer service (and the lady was very rude to me) and I finally said I had to do some research & I'd call back. It didn't tank my score too bad (my high balances on my credit cards are the main factor in my lower scores) but it is a huge negative that will sit on there for 7 years! I could cry. 2 are showing as "Paid / Charged Off" and one is showing as just "Charged Off"

Any advice? Write a nice letter asking for removal since it was paid?

[Anonymous]

---

@SSPA87 wrote:
Last year a bank account went into the negative. When I received a letter offering a pay back plan, I paid the account off in 3 payments. Was paid off by March 2016. Was told account could be reopened. I chose not to since I have no local branches.

This weekend I received a credit alert that I have a Charge Off from the bank! I'm furious & very upset. I'd finally gotten a clean report after an ex had royally ruined it. Now I have a charge off showing that I'd already paid!

Is there anything I can do to get this removed? I was so flustered when I called customer service (and the lady was very rude to me) and I finally said I had to do some research & I'd call back. It didn't tank my score too bad (my high balances on my credit cards are the main factor in my lower scores) but it is a huge negative that will sit on there for 7 years! I could cry. 2 are showing as "Paid / Charged Off" and one is showing as just "Charged Off"

Any advice? Write a nice letter asking for removal since it was paid?

---

How long was the account delinquent?

[SSPA87]

---

@Anonymous wrote:

---

@SSPA87 wrote:
Last year a bank account went into the negative. When I received a letter offering a pay back plan, I paid the account off in 3 payments. Was paid off by March 2016. Was told account could be reopened. I chose not to since I have no local branches.

This weekend I received a credit alert that I have a Charge Off from the bank! I'm furious & very upset. I'd finally gotten a clean report after an ex had royally ruined it. Now I have a charge off showing that I'd already paid!

Is there anything I can do to get this removed? I was so flustered when I called customer service (and the lady was very rude to me) and I finally said I had to do some research & I'd call back. It didn't tank my score too bad (my high balances on my credit cards are the main factor in my lower scores) but it is a huge negative that will sit on there for 7 years! I could cry. 2 are showing as "Paid / Charged Off" and one is showing as just "Charged Off"

Any advice? Write a nice letter asking for removal since it was paid?

---

How long was the account delinquent?

---

They said 60 days since DOFD to Charge Off.

[Anonymous]

---

@SSPA87 wrote:

---

@Anonymous wrote:

---

@SSPA87 wrote:
Last year a bank account went into the negative. When I received a letter offering a pay back plan, I paid the account off in 3 payments. Was paid off by March 2016. Was told account could be reopened. I chose not to since I have no local branches.

This weekend I received a credit alert that I have a Charge Off from the bank! I'm furious & very upset. I'd finally gotten a clean report after an ex had royally ruined it. Now I have a charge off showing that I'd already paid!

Is there anything I can do to get this removed? I was so flustered when I called customer service (and the lady was very rude to me) and I finally said I had to do some research & I'd call back. It didn't tank my score too bad (my high balances on my credit cards are the main factor in my lower scores) but it is a huge negative that will sit on there for 7 years! I could cry. 2 are showing as "Paid / Charged Off" and one is showing as just "Charged Off"

Any advice? Write a nice letter asking for removal since it was paid?

---

How long was the account delinquent?

---

They said 60 days since DOFD to Charge Off.

---

Did they notify you of the deficiency during that 60 days?

[RobertEG]

A charge-off is an accounting measure that permits, and in most cases requires, the creditor to move the debt owed from the accounts receivable (i.e., asset) columnd of their accounting ledger over to a bad-debt column that is not a legal asset.  The primary intent is to prevent banks and creditors from overstating their "real" assets.

Federal banking regs consider debt to have prima facie become an uncollectible bad debt for accounting purposes once it reaches 120-180 days late, with variances depending upon the type of debt.  However, if the creditor has reasonable basis for determining at an earier date that a debt is unlikely to be repaid, they can still do a charge off.

The issue is whether or not they have a reasonable basis for having determined that you are not likely to repay the debt.

Being 90 days late is usually not, in and of itself, basis for supporting a charge to profit and loss.

I would suggest, if they have provided no extenuating circumstances for taking a charge to profit and loss at a time earlier than the normal federal regulation standard, of filing a dispute over the accuracy of that determination, and thus reporting, and if they verify, then file a formal complaint with the CFPB or consult an attorney with the view of bringing your own civil action.  You will likely need support of either the CFPB or the court to conclude that they have not complied with federal regs regarding conditions supporting a charge-off.  It is, at this point, entirely a legal issue based on whether they have support in the regs for their action. 

[SSPA87]

---

@RobertEG wrote:

A charge-off is an accounting measure that permits, and in most cases requires, the creditor to move the debt owed from the accounts receivable (i.e., asset) columnd of their accounting ledger over to a bad-debt column that is not a legal asset.  The primary intent is to prevent banks and creditors from overstating their "real" assets.

Federal banking regs consider debt to have prima facie become an uncollectible bad debt for accounting purposes once it reaches 120-180 days late, with variances depending upon the type of debt.  However, if the creditor has reasonable basis for determining at an earier date that a debt is unlikely to be repaid, they can still do a charge off.

The issue is whether or not they have a reasonable basis for having determined that you are not likely to repay the debt.

Being 90 days late is usually not, in and of itself, basis for supporting a charge to profit and loss.

I would suggest, if they have provided no extenuating circumstances for taking a charge to profit and loss at a time earlier than the normal federal regulation standard, of filing a dispute over the accuracy of that determination, and thus reporting, and if they verify, then file a formal complaint with the CFPB or consult an attorney with the view of bringing your own civil action.  You will likely need support of either the CFPB or the court to conclude that they have not complied with federal regs regarding conditions supporting a charge-off.  It is, at this point, entirely a legal issue based on whether they have support in the regs for their action. 

---

The Collections lady I spoke with told me that banks can charge off checking accounts after 60 days. Seems crazy to me, that's only 2 months! I got no notification that they were intending to charge it off. I didn't even get notice they were sending it to collections until after they supposedly charged it off! As soon as I got a letter about setting up a payment plan, I called & made arrangements & followed through. Paid every dime owed. And now 10 months after they supposedly charged the account off (Jan 11th 2016 I think) they randomly decide to report it to credit bureaus? What the heck is that all about?!

I'm most concerned with my other banks and/or credit cards taking adverse action due to this. What is the likelihood of that? It is reporting as paid but still a charge off none the less... 

[Anonymous]

---

@SSPA87 wrote:

---

@RobertEG wrote:

A charge-off is an accounting measure that permits, and in most cases requires, the creditor to move the debt owed from the accounts receivable (i.e., asset) columnd of their accounting ledger over to a bad-debt column that is not a legal asset.  The primary intent is to prevent banks and creditors from overstating their "real" assets.

Federal banking regs consider debt to have prima facie become an uncollectible bad debt for accounting purposes once it reaches 120-180 days late, with variances depending upon the type of debt.  However, if the creditor has reasonable basis for determining at an earier date that a debt is unlikely to be repaid, they can still do a charge off.

The issue is whether or not they have a reasonable basis for having determined that you are not likely to repay the debt.

Being 90 days late is usually not, in and of itself, basis for supporting a charge to profit and loss.

I would suggest, if they have provided no extenuating circumstances for taking a charge to profit and loss at a time earlier than the normal federal regulation standard, of filing a dispute over the accuracy of that determination, and thus reporting, and if they verify, then file a formal complaint with the CFPB or consult an attorney with the view of bringing your own civil action.  You will likely need support of either the CFPB or the court to conclude that they have not complied with federal regs regarding conditions supporting a charge-off.  It is, at this point, entirely a legal issue based on whether they have support in the regs for their action. 

---

The Collections lady I spoke with told me that banks can charge off checking accounts after 60 days. Seems crazy to me, that's only 2 months! I got no notification that they were intending to charge it off. I didn't even get notice they were sending it to collections until after they supposedly charged it off! As soon as I got a letter about setting up a payment plan, I called & made arrangements & followed through. Paid every dime owed. And now 10 months after they supposedly charged the account off (Jan 11th 2016 I think) they randomly decide to report it to credit bureaus? What the heck is that all about?!

I'm most concerned with my other banks and/or credit cards taking adverse action due to this. What is the likelihood of that? It is reporting as paid but still a charge off none the less... 

---

How far underwater did the account go?

[RobertEG]

policy statement.....

Financial Institution Letters FIL-11-2005 February 18, 2005

Overdraft Protection Programs Joint Agency Guidance The federal banking and credit union regulatory agencies are issuing the attached joint guidance on overdraft protection programs. The guidance details safety and soundness considerations, outlines federal regulations as they pertain to these programs, and lists a variety of industry best practices. The Federal Deposit Insurance Corporation (FDIC), the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency, and the National Credit Union Administration (the Agencies) are jointly issuing the attached guidance on overdraft protection programs. Overdrawn accounts and ad-hoc overdraft approvals have always been part of bank deposit programs. For many years, overdrafts have been managed by tying them to other deposit accounts, lines of credit or credit cards. Recently, however, programs have been developed that improve banks' ability to automate decisions about whether to pay checks drawn against insufficient funds. These programs are frequently purchased from a vendor and are advertised to the consumer. While both the availability and customer acceptance of these overdraft protection services have increased, aspects of the marketing, disclosure and implementation of some of these programs have raised concerns with the Agencies. The guidance discusses: the historical and traditional approaches to providing consumers with protection against account overdrafts, and contrasts those approaches with the more recent overdraft protection services now marketed to consumers; existing and potential concerns of the regulatory agencies surrounding the offering and administration of such overdraft protection services; safety and soundness considerations, such as a 60-day charge-off requirement and whether institutions offering overdraft protection services have adopted adequate policies and procedures to address the credit, operational and other risks associated with these services; key legal issues, including compliance with all federal and state laws; and best practices found to be in use or recommended by the industry, including marketing and communications that accompany the offering of overdraft protection services, as well as the disclosure and operations of program features. This final joint guidance incorporates changes made by the Agencies to provide clarity and address commenter concerns.   Michael J. Zamorski Director Division of Supervision and Consumer Protection