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What is a charged off account on a credit card
Can you please tell me what a charge off account on a credit card means? I don’t have to pay this debt?
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1 Reply
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When a person fails to pay a credit card for multiple months (generally 4, but it varies), the card issuer may choose to “charge off” the debt. This means that they consider the debt to be uncollectible and take a tax write off. As far as the credit report, the card will no longer be shown with new lates (all previous lates stay), but will be marked charged off . They can still post a balance on this debt UNLESS they sell to a junk debt buyer (collection agency). At this point, they can still show the late payments and the charged off debt, but can no longer show a balance. This means that one account can actually be shown negatively twice…. once as a charge off and once as a collection.