When Is Cc Considered A Charge Off

[illini76]

What is the name of your state? ILLINOIS

I had a cc that i stoped making payments on wa turned over to collection company after awhile went to two or three different creditors till finally i decided to make payments to pay off debt in full my question is while i am still waiting for my first credit report in the mail most likely is my cc considered to have been a chargeoff i never recieved any offical notice
in writing.

[Tayla]

Charge offs are often around the 90-180 days after date of default. Although let it be known that it is AT THE COMPLETE DISCRETION of a business to charge off an account. They can keep the account open and on the books if they so choose. Charge-offs do not release the account holder from paying or being pursued for collecting.

[cha0sman]

Correct, Charge offs do not relieve people from paying the debt. Most people do not understand what a charge off means. I will explain:

When a company gives a loan out, they charge interest, the government taxes the interest that the company receives. What happens is when a credit card or a loan etc gets charged off, what happens is they write that tax off and they get refunded. They do NOT write the debt off they only write the interest off. In which case when they do collect the debt with the interest, they pay the government the taxes they owe from that debt.

[bdancer]

Originally Posted by cha0sman

Correct, Charge offs do not relieve people from paying the debt. Most people do not understand what a charge off means. I will explain:

When a company gives a loan out, they charge interest, the government taxes the interest that the company receives. What happens is when a credit card or a loan etc gets charged off, what happens is they write that tax off and they get refunded. They do NOT write the debt off they only write the interest off. In which case when they do collect the debt with the interest, they pay the government the taxes they owe from that debt.

Huh??? So how about the principle or the credit card charges?

A company charges off bad debt -- all of it, principle, interest, fees, etc. While the interest and fees would have previously been reported as income, the principle or credit card charges would still be money the company would lose when the account is charge off.

Charge offs are strictly accounting actions of the loan or credit card company and have no bearing on the liability of the debtor.