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Due to some recent finance problems, my credit card company stated on my credit report a write off/charge off for the debt. ($19,000) The collection agency says that is just an accounting term and they can still collect the debt. Can they?

2006-11-30 13:50:55 · 4 answers · asked by gregwhatshisname 2 in Business & Finance Credit

4 answers

Usually this happens if you haven't paid anything for 180 days. after the 180 days is when your card will charge off. what that means for you is that you will get an R9 on your credit report. that's the worst rating you couldpossibly get. It screws you because when you are trying to apply for another card or a loan or anything they look at that and that shows that you were not faithful in making payments and they are less likely to give you their card. you can wait 7 years and your credit will go back down to normal. If you let your card charge off there is no point in paying anything, you will still get that R9 on your rating. The credit card company basically just counts that as a loss to their company and move on. i worked for capital one for a while and they had over 200 million customers...so i'm thinking a few charge off's won't hurt them that much....hope that helped:)

2006-11-30 17:46:53 · answer #1 · answered by Starry Eyes 5 · 1 0

The credit card company has classified your debt as a "Doubtful" account and has, for accounting purposes, written the debt off. They have reported this to the Credit Bureau as an R9 writeoff, a major derogatory item which will significantly reduce your credit score, making it much more difficult for you to obtain credit in the future.

The terms of the debt remain unchanged...you still owe them the money. The credit card company may continue to try to collect the debt from you themselves but often, will turn the account over to a collection agency, who will try to collect the debt on their behalf and are paid a percentage of all funds recovered.

As the credit card company has classified the debt as "doubtful to collect" they are most interested in collecting the principal balance owing and they really don't expect to collect any more interest on the debt even though they are legally entitled to it. They would certainly accept a partial lump sum payment in full payment of the debt if you were fortunate enough to have a source available to do so.

2006-11-30 15:05:44 · answer #2 · answered by bobbus10011 2 · 1 0

this means your credit card company has given up collecting the debt and has booked the amount as a loss. they will then pass the collection effort to an agency who will pursue the debt. once the agency collects the amount, they will either keep the entire amount or a large % of it as their "fee" to the credit card company. if the agency does not collect from you after a certain number of attempts, then this becomes a permanent mark against your credit history.

2006-11-30 14:08:33 · answer #3 · answered by openheimer 1 · 1 0

It means that the company reported the financial loss on their taxes due to them believing you would never pay. They can collect until they reach the statute of limitations for your state. A charge-off is (not the worst), but one of the worse things you can have on your report. Less than 20% of the people have a charge off. See if you can make payment arrangements with them if they will remove the charge off.

2006-11-30 14:20:27 · answer #4 · answered by Mariposa 7 · 0 0

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