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what to do with charge offs

Regular Contributor

what to do with charge offs

When I went through my medical crisis and then the job loss, there were accounts I could not pay on as originally agreed. Some companies agreed to take a smaller payment and others would not. It was frustrating as it seemed better to me to take a partial payment rather than none. 3 of the companiesthat would not take a smaller payment  then proceeded to "charge off" my accounts and that is how they are listed on my credit report. Is there anything I can do about this? I can now pay on these accounts, but can I even do this? Will it help my credit score? I have been doing a lot of reading and I get conflicting advice. Some say don't pay as it activates the account, others say it improves your score to pay off a charge off. I don't have a problem paying what I owe, but when the original balance was $850 and they have added $400 in fees it seems excessive. Just looking for guidance as I am doing my best to clean up the mess of my credit score.

Message 1 of 3
Legendary Contributor

Re: what to do with charge offs

Debt owed to a credit is an asset not yet received.  It is carried in their accounting books as a receivable asset.

If a debt becomes delinquent to the point where they determine that it is unlikely to be paid, they can shift the debt to a non-receivable bad debt.

In doing so, they reduce their stated assets, and thus their tax obligation.


A debt that has been charge-off still remains fully due by the consumer, and the creditor, their debt collector, or any subsequent owner can still attempt to collect the entire amount.  Thus,as the consumer, it means little to you other than the fact that they have reported that internal business procedure to your credit report.

The showing of a CO in your credit report is a negative, in that it informs others that you have or had a debt that the credtior determined you were not going to pay.


Yes,you can pay just as if the CO never existed.  The normal process is to offer to pay the debt in exchange for their agreement to delete that negative reporting.

Paying does not improve your score, but it removes delinquent debt from your credit history. 

The CO will cease to be shown in your CR after 7 years plus 180 days from the date of first delinquency on the account, but the unpaid debt still remains, and can be an obstacle to obtaining new credit even after credit report exclusion.


I would send them a pay for delete offer.

Message 2 of 3
Regular Contributor

Re: what to do with charge offs

Thank you for the suggestion. I will look at sending them a pay for delete letter and hope for the best.


Thank you for the advice.

Message 3 of 3
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