Does a charged-off account remain collectible?

Hi James,

Even though the term "charge-off" means that the creditor or lender has written off the debt as a loss, this does not necessarily mean that the debt is forgiven. Depending on the type of debt and on your particular state laws, the lawsuits, garnishments, and liens you refer to are all actions that may be allowed in some collection processes on some types of accounts. These types of actions, if completed successfully by the collector, would show up on your credit report in the "Public Records" section. Even though you may have had good-credit intentions, future creditors may view the use of these types of public actions. This is a negative sign that shows you are not capable or responsible to pay your debts as promised.

Because of this, it might be worthwhile for you to contact the creditor on this account and discuss the possibility of setting up a new payment plan. Even though this account has fallen off your report for now, new notations that you have paid off this debt could be placed on your report. In addition, current and future credit grantors would likely take a positive view of making such an effort to pay off an old debt. By working to pay this old account off, you might not only be improving your credit, but also avoiding any future collection actions that might occur.

ok, well first thing you need to do James, is find out the Statute of Limitations in your state. Some are 3 years, and I believe the longest is 6 years, for credit card debt.

The last time you paid on this debt is when the clock starts ticking on SOL.

If the SOL has passed on this debt, that simply means nobody can prevail in legal action against you to make you pay this debt. Any repayment will be voluntary, and please make sure that when you contact the creditor that you get a written agreement from them that they will not report this on your credit report.

Some states do have laws that making payment after charge off can reset the SOL, especially if a new contract is signed so beware.

Might be a good idea to contact local state's attorney to ask them some questions particular to your state on statute of limitation laws, or if they can point you in the right direction.

As said by Pammila, you need to consult a lawyer for understanding the SOL in your state. If you keep your debt just like that and you are not aware about it, then it will put you in real trouble in the future.

Please consult a lawyer and do let us know what you have thought

Roxette