• Spectacular!

    I liked your fast, friendly service. You were all knowledgeable in the area of bankruptcy. Your treatment of me as a client was spectacular! You were great at promptly responding to my questions and concerns. I loved that you provided courteous and quick responses to all my questions.
    --Donna
  • Highly Recommended!

    I have worked with Seth and he is the utmost professional in how he works with his clients. If you need an attorney you can trust I would highly recommend the Law Office of Seth Hanson.
    --David
  • Very Professional.

    Everyone was very professional and efficient. Seth, and everyone that I had contact with were very knowledgeable. I was very pleased with how we were treated by his staff. My questions were always answered promptly. I was very pleased with the service I received and would not hesitate to refer someone to your firm.
    --Anonymous
  • Non-judgmental.

    You were very open and answered all of my questions. You never made me feel like I was asking a dumb question. I was comfortable with your knowledge of the law. It was hard for me to make this decision to move forward in my life. Everyone was friendly to me and respectful. Non-judgmental. Every question I asked was answered promptly and appropriately. I would recommend you.
    --Anonymous
  • More Than Expected!

    I found the firm's representation to be more than what I expected. I was always kept in the loop, all my questions were answered (whether or not I asked more than once the same question), and I felt completely supported by the firm staff when going through this (at times) scary ordeal. Thank you again.
    --Joanna
  • Very Impressed!

    I liked that you had very friendly, caring staff. You were all very knowledgeable. Your treatment towards me was excellent and you quickly responded to all my concerns. If a friend asked of your overall impression, I would say that we were very impressed and we would recommend you to them.
    --Danielle

What Does “charge Off” Really Mean?

We regularly hear debtors tell us that a debt has been “charged off” and they are no longer responsible for the debt. Unfortunately, the term “charged off” can mislead a debtor into thinking they are free of the debt and the debt “fell off” their credit report.

Accounting term

The term “charged off” is an accounting term, not a legal term. And a charged-off debt can still be collected upon. A creditor charges off a debt when it cannot realistically collect a debt. IRS and accounting guidelines control the timing of when a creditor must charge off a debt.

“Charge off” means that a creditor does not think that they can collect the debt. Because of this status, the creditor removes the debt (considered an asset) from their balance sheet. This way, the creditor does not overstate the amount of their assets to the IRS (debts owed to them).

Charge-off doesn’t change the legal status of the debt. This distinction confuses most people as they assume when a debt is labeled as “charged off” they are no longer responsible for repaying that debt.

Can a collector come after me if the debt has been charged off?

Can a creditor sue you after charging off your debt? Yes, they sure can! This answer comes as a surprise to many people. Assuming that a creditor cannot sue you over a charged-off debt.

A creditor that charges off a debt might also at the same time sell the account to a third party. By selling the debt to an alternate collection agency, they are repaid, and the new collection agency is banking on being able to collect the debt from you. The charged off status does not stop a third-party collector from filing a lawsuit over the debt.

As you can see, charged off debts can follow a person around for quite some time and it is important not to slip into a false sense of security when seeing “charged off” on your credit report.

A charge off can still show up on your credit report

People often assume that a charged off account will no longer appear on a credit report. Unfortunately, this is not true. A charged off debt can, and usually does, appear on a credit report even after seven years of inactivity.

It is important not to assume that charged off debts won’t hurt your credit score. Charged off debts absolutely will have an effect on your credit report. Ultimately, a person with a charged off account needs to take action to resolve the account.

Filing bankruptcy may be the key to ending the vicious cycle of debts being sold to new collectors over time. For a free consultation, call your local Fairfield bankruptcy attorney.

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