Charge offs?

Question

I have several charge offs on my credit report. What should I do to improve me score? Should I just wait til they are off my credit, or should I pay them what their offering through settlement?

Answer 1

Cougielv: First do NOT listen to the first two post they haven't a clue to what they are saying.
2nd: The charge-offs will stay on your report for a total of 7 years..even if you pay them off they will show a "Paid-Charge Off"..if you get the collection agency to list it paid. You maybe able to cut a deal with the collection Agency of the original owner of the debt that if you pay they will delete it from your account of list it Paid in good standing..it's HARD to do. But they will fall off in 7 years from the time they went bad or your first 30 day late. You will find it hard to obtain prime credit offers until they are gone..if they are near 7 years old..I'd let them ride. I'd also check your states SOL to see if you can be sued. Google states Credit SOL or yahoo...then look up your state. If your are beyond the SOL..then dispute them to the credit reporting agencies..you might get lucky.

Answer 2

charge offs are the last step for collection by trhe agencies. You've been late so much or haven;t been paying enough that the company bascially said screw it and are willing to take a lesser amount of the balance than you owe just to get rid of it. All the rolling lates and collection really damage your credit. if this activity is fairly recent, then pay off the settlements and start from fresh. it is a myth that things on your credit report "vanish" after 7 years...not true. EVERYTHING is on your credit and will stay there forever. If you pay off the charge offs, evevntually, they won't disappear from yoru credit altogether but will cease making a negative impact on your score. There is no real "Fresh" start over when talking about credit. The only thing you can do is obtain a new "credit era" so to speak. get another credit card and use it only for your essentials, i.e. gas, groceries etc., and pay off the balance each month, all of it. Continue this trend and after about 6-8 months you'll improvements in your score. DO NOT exceed your credit limit by more than 50%. what most people don't know is that if your balance jumps above 50% on your limit, you score dips, small increments, the length of the time you're over that 50% threshold. so just keep everything low but not TOO low and pay it off every month and on time and you'll see better results next time you check your credit.

Answer 3

Division of Financial Practices
~
Clarke W. Brinckerhoff
Attorney
-
202-326-3224
UNITED STATES OF AMERICA
FEDERAL TRADE COMMISSION
WASHINGTON, D.C. 20580


February 15, 2000

Ms. Alaina K. Amason
14155 Shire Oak
San Antonio, TX 78247

Dear Ms. Amason:

This responds to your letter concerning the time limitations imposed by the Fair Credit Reporting Act ("FCRA") on the reporting of chargeoff accounts by a consumer reporting agency ("CRA," usually a credit bureau). We list your inquiries on this topic below in italics, with our replies immediately following each item.

1. What reporting limits does the FCRA provide with respect to chargeoffs, and how long have they been in effect?

Section 605(a)(4), which has been in effect since the FCRA became effective in April 1971, has always prohibited CRAs from reporting chargeoffs that are more than seven years old.(1) Section 623(a)(5), which became law in September 1997, requires a creditor that reports a chargeoff to a CRA to notify the agency (within 90 days of reporting the account) of "the month and year of the commencement of the delinquency that immediately preceded" the chargeoff. Section 605(c)(1) provides that the seven year period begins 180 days from that date. Both provisions were part of the major revision to the FCRA that were enacted in 1996.(2)
2. Is the reporting period extended if (A) the original creditor sells or transfers the account to another creditor, (B) the consumer responds to post-chargeoff collection efforts by making a payment on the debt, or (C) the consumer disputes the account with a CRA? Does it matter whether the 7-year period has expired when any of these events occurs?

No. In enacting the new provisions discussed above, Congress intended to establish a date certain -- 180 days after the start of the delinquency that led to the chargeoff -- to begin the obsolescence period. It did so to correct the often lengthy extension of the period that resulted from later events under the original FCRA. Enclosed are two staff opinion letters (Kosmerl, 06/04/99; Johnson, 08/31/98) that discuss the impact of these provisions, and the legislative history relating to their enactment, in more detail. Because the commencement of the seven year period is now described with some precision by the statute, it is our opinion that none of the subsequent events you listed -- sale of the charged off account by the creditor, or a payment on or dispute about the account by the consumer -- changes the allowable period for a CRA to report a chargeoff.
3. Since Sections 623(a)(5) and 605(c)(1) provide new rules for calculating the 7-year period that became effective in 1997, do chargeoff accounts now have different obsolescence periods depending on when the chargeoff occurred?

Yes. Section 605(c)(2) states that the section "shall apply only to items of information added to the (CRA) file of a consumer on or after" 455 days after enactment, or December 29, 1997. Therefore, a chargeoff reported to a CRA on or after that date is subject to the new commencement-of-the-delinquency method of calculating the obsolescence period set forth in Sections 623(a)(5) and 605(c)(1). On the other hand, a chargeoff reported to a CRA before December 29, 1997, is not covered by the new provisions, as discussed in one of the enclosed letters (Kosmerl, 06/04/99). If a credit account was reported as a chargeoff before that date, the Commission's view has been that it can be reported for seven years from the date the creditor actually charged it off.(3)
The opinions set forth in this informal staff letter are not binding on the Commission.

Sincerely yours,

Clarke W. Brinckerhoff


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1. Section 605(b) provides that there is no time limit applicable to a report made in connection with credit involving a principal amount (or insurance with a face amount) of $150,000 or more, or employment for a salary of $75,000 or more. Prior to September 1997, those amounts were $50,000 and $20,000, respectively.

2. The Consumer Credit Reporting Reform Act of 1996 (Title II, Subchapter D, of Public Law 104-280, signed into law on September 30, 1996), made many other changes to the FCRA.

3. Commentary on the Fair Credit Reporting Act, 16 CFR Part 600 Appendix, comment 605(a)(4)-2. 55 Fed. Reg. 18804, 18818 (May 4, 1990).

Answer 4

Depends, when was the deliquency? Usually, some come off 7 years from deliquency. Now, if you are almost at 7 years I would wait for them to come off, that would make your score better. If you start to pay them, then the account shows that it is more recent and actually make your credit go down alittle bit (but will still come off 7 years from original deliquency).

Answer 5

value off is a accounting term, all this implies is that the unique creditor has written off your debt as noncollectable. This doe's no longer mean which you do no longer nonetheless owe the money just to somebody else. What they do is sell your debt to a set organization who will come once you for the money. so which you will finally end up with no longer basically the value off showing on your credit yet in addition the series interest for the subsequent 7-years.

Answer 6

well, if you pay the settlement, that will count as income to the irs and you will have to pay taxes on it....which are high.....so the best thing to do is to call and try to make payment arangements....if they refuse, continue to pay....they cannot refuse to accept your payment as that will be saying that the loan is paid...there is really nothing to do once the account has gone to charge off though except to pay it....it will stay on your credit report unit the entire account is paid.

Answer 7

why don't you just pay your bills man
you'll live a much better life