Charge off

[QueenJ]

Could someone please explain to me a charge off?

I have two credit cards which are showing up as charge offs and they have an amount which is more than i currently owe them, however both of them i am in a repayment plan.  I dont understand why they have them listed as charge offs.  They are not in collections.  Is there anything i should or can do?

Thank you

[tcbofade]

Well, literally, a charge off means that the original lender is writing the debt off as a loss.

Generally, that happens when they sell the debt to a collection agency.

If that is NOT what has occured, I would suggest you contact the lender and ask them why they are being reported as charge-offs.

Good luck!

[QueenJ]

One of them i believe has been sent to a collection agency, the other one if it has been sent it has been since i began my payment plan. Can they report it as a charge off even if i have entered a payment plan with them and paying them on time?

[Anonymous]

Here is my situation, I had a five year installment loan I paid on time for three years, suddenly one day about two years ago a debt collection agency started calling me telling me they took over the account.  After a big dispute with Citi Financial they said they moved my account because it was at risk.  I then paid the account, in full, via the same installments to the collection agency.  I finished paying off the account six months ago, two months later a charge off from Citi showed up on my report.  How do I remove it?  I paid the entire account in full and was never late! 

Any suggestions would be awesome!

[guiness56]

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@tcbofade wrote:

Well, literally, a charge off means that the original lender is writing the debt off as a loss.

Generally, that happens when they sell the debt to a collection agency.

If that is NOT what has occured, I would suggest you contact the lender and ask them why they are being reported as charge-offs.

Good luck!

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I have seen many posts with this information and it is not true.

A charge off is when the creditor does not think they will get paid for the debt.   Depending on the type of debt,  a CO will occure anywhere from 120 -180 days after an account is not caught up to current.  It is an accounting term and it gets them a tax write off.  Once an account is CO'd, the debt is still owed.  The OC may pursue the debt themselves or sell it or assign it to a CA.  If the debt is still owned by the OC, they will show a balance, same with assigned to a CA.  If the debt was sold to a CA the balance will be 0.  Just because it was a CO does not mean it is automatically sold to a CA.

[guiness56]

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@QueenJ wrote:

Could someone please explain to me a charge off?

I have two credit cards which are showing up as charge offs and they have an amount which is more than i currently owe them, however both of them i am in a repayment plan.  I dont understand why they have them listed as charge offs.  They are not in collections.  Is there anything i should or can do?

Thank you

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A CO is an accounting term only.  They wrote if off for profit and loss, tax purposes.  The debt is still owed and it will collect interest and late fees until it is paid off.  Even though you are in a payment plan with them it is still past due and will be until it is paid off.  They will then reflect paid after CO on your CR.

No there is nothing that can be done about it unless you can get the OC to agree to certain terms for you paying them.  Say a PFD or removing negative annotations.

[guiness56]

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@Anonymous wrote:

Here is my situation, I had a five year installment loan I paid on time for three years, suddenly one day about two years ago a debt collection agency started calling me telling me they took over the account.  After a big dispute with Citi Financial they said they moved my account because it was at risk.  I then paid the account, in full, via the same installments to the collection agency.  I finished paying off the account six months ago, two months later a charge off from Citi showed up on my report.  How do I remove it?  I paid the entire account in full and was never late! 

Any suggestions would be awesome!

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You were never late when you were with Citi Financial?