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Chargeoff balances

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cappaccinodagreat
Valued Member

Chargeoff balances

I read someplace that if a credit card acount is listed on your credit report as a "charge off" then the "balance" should show on your credit report as zero ($0). Does anyone know if this is accurate?

Message 1 of 10
9 REPLIES 9
Shogun
Moderator Emeritus

Re: Chargeoff balances

No, if you still owe it, it can show a balance.  If it does show $0, then they've most likely sold the debt to a CA.

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Message 2 of 10
nativenyer
Frequent Contributor

Re: Chargeoff balances

If it was sold to a CA and the balance has been paid in full can you request a goodwill deletion from the OC?

Message 3 of 10
RobertEG
Legendary Contributor

Re: Chargeoff balances

If a creditor sold the debt after taking the CO, they sold it for pennies on the dollar, as its status as a charged-off debt makes it a high risk collection.

 

If you subsequently pay the new owner/debt collector, the OC does not receive a penny of that payment.

They have a net loss on the debt, reduced a bit by their discounted sale of the debt.

Loss on the account is not usually conducive to their good-will.

Chances are better if you pay pror to their sale of the debt.

 

That said, give it a try.

Do you have some compelling reasons why the debt reamined delinquent to the point they charged it off and sold it at a loss?

Message 4 of 10
cappaccinodagreat
Valued Member

Re: Chargeoff balances

I dont really have faith in a goodwill removal at this point, so its not something I was concidering. But.....

 

what confused me is...... if the OC has charged it off and the account is now in the hands of a collection agency, shouldnt the balance from the OC now state zero...... since I would no longer owe them the debt?

 

I ask this because, for example, if the collection agency that now owns the debt, now reports it on your credit report, it would show that your debt would be twice as much as what is really owned if the OC still shows a balance, right?

Message 5 of 10
RobertEG
Legendary Contributor

Re: Chargeoff balances

If the creditor has sold the debt, they were required to have promptly reported $0 balance to the CRA.

That is the case regardless of whether they did a charge-off.

Message 6 of 10
cappaccinodagreat
Valued Member

Re: Chargeoff balances

thank you, thats the info I was looking for

Message 7 of 10
Army275RGR
New Member

Re: Chargeoff balances

If the OC has washed their hands of the debt, then how can I get stuff like that removed? If I dispute it will they have any record of me? I know the CA will but what about the OC? is it possible that they have purged their system of my information and I can get it removed through a dispute?

Message 8 of 10
RammaCredit
New Contributor

Re: Chargeoff balances

So if the debt has been sold, and the balance is not reporting as $0 how do you get the CRA to update?

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Message 9 of 10
RobertEG
Legendary Contributor

Re: Chargeoff balances

First, be careful what balance you are looking at.

When a debt is charged-off, the amount of the CO is recorded under a "sticky" code that does not change based on later payments against the debt.

That continues to advise others of the level of the delinquent debt that the creditor determined was unlikely to be paid.

That code is titled as the amount charged-off, and does not become $0 if the debt is paid or sold.

The current balance reflects the current state of the debt owed, and thus does reduce or become $0.

 

The stautory basis for disputing any reporting that was once accurate but has become inaccurate due to changes is FCRA 623(a)(2).

That section reuires a furnisher to promptly update any reported information as necessary to reflect its current accuracy.

What is "prompt" is not defined as a specific number of days. 

My recommended interpretation would be that "promptly" would be in their next regular reporting cycle to the CRAs, which can be up to a month after the change in information.

Message 10 of 10
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