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Removing a Charge Off from Your Credit Report

Charge-offs hurt your credit, plain and simple! You are already 180 days late on your payment(s) by the time your account gets charged off.  Once there is a charge-off listing on your report, it will remain on your credit report for seven years from the date it was first charged off. Seven years is a very long time to have your credit report plagued by such a negative entry.  As long as you have charge offs on your credit report your credit score will suffer.

A Charge-Off Does Not Mean That Your Debt Has Been Forgiven

Do not be mislead by the name. Once an account has been charged-off, you will still be responsible for paying it! For as long as the charge-off stays unpaid, creditors can continue their attempts to collect on the account.  This may even include suing you for the full amount.

Future lenders and creditors view charge-offs very seriously.  This is why it is in your best interest to rid your credit report of charge-offs.  Your best bet for minimizing the effects of a a charged-off account is negotiation.

Most frequently, charge-offs are passed on to a debt collector. However, when it comes to dealing with charge-offs, it is not in your best interest to deal with a collection agency. The reason for avoiding negotiation with a collection agency is simple. Since it is the original creditor who reported a charged-off account to the credit bureaus, a collector cannot do anything about what was reported to the credit bureaus by the original creditor.

You need to contact the original creditor in order to remove a charge-off.  You will want to do what you can to persuade the original creditor to get rid of the charge-off from your credit report in exchange for payment. You need to be clear on how much you are able to pay, before making the call to the creditor. Your negotiating power lies in how much you can pay and how soon you can pay it.  The more you can pay and the sooner you can pay it will give you more power in negotiating and help make your offer more appealing to the creditor.  Make sure to speak to someone who has the power to remove charge-offs from your credit report.  This is essential so that you don't waste your time and energy on talking to someone who has no power to say "yes" to your offer.

When Things Don't Work In Your Favor

If all your attempts at getting the charge-off removed from your account fail, it may be time to decide if you are going to pay the account or not.  Keep in mind that though the account will be reported as charged off until the time is up for the reporting of credit, it will not affect your score as negatively as times goes on. Still, there are many lenders who will not extend any new credit or loans to you until you have paid off all of your past due accounts. If you intend to get a mortgage or auto loan in the next seven years, then it is to your advantage to pay your account(s). If you do decide to pay off the