Amex account chargeoff while in "Care" program

Charge off is an accounting term and a non-event as far as you are concerned. All it means is charged against income. It does not mean that you don't still owe it or that they can't still collect. Regardless of what program they enrolled you in, if you were late on your payment, you have defaulted on your User Agreement. Do yourself a favor, make sure you get this paid off ASAP. Amex is the elephant that never forgets and they do look favorably on those who do get their accts paid off.

As far as I know, charge off means that the creditor cannot recover the debt and so they consider it as a bad debt, but it does not mean that you are not required to pay it off. Even if the creditor charges off a debt, they can sue you to the court at a later date and bring judgment against you to recover it.

The same thing happened to me only worse ! My small business closed and had a 10K balance on my AmEx business card. They called ME and asked if I wanted to enroll on the Care Program (yeah right) which I agreed and made two payments on their terms and on time. The third month, they turned me over to a collection agency which demanded I pay in full. I called AmEx and they REFUSED to talk to me because my debt had been turned over to collection.

Same thing happened to me with Amex. Once I found out they turned me over to collections I stopped payments and I'm settling with them for 35%.

If you do not have such payment agreements in writing, then you don't have a leg to stand on in court. ALWAYS get it in writing, FIRST.

Guest,

Quote:

Many regulators force lenders to chargeoff their debt when it reaches a certain time period. For example, the FDIC makes banks chargeoff an account as bad debt when it reaches 120 days past-due, regardless whether the customer is making partial payments or not.

That doesn't mean it is uncollectible or that the creditor cannot recover it. It is an accounting term in short meaning that they "charged" the debt against their loss reserve in order to discount their net tangible assets.

Think of it like this: If someone gives you a million dollar check, you would think you're rich. But if it's a bad check and will never clear, then you're only rich on paper. Same thing with banks... If they have all these open receivables, on paper it looks like they have a lot of assets and looks very lucrative to investors. But in reality if the paper is not performing (paying), then they are just kidding themselves (and the shareholders) to leave it on the books as an asset. So they discount those assets by charging off the bad debt, and the net tangible assets is what they can reasonably expect to collect in the future.