It should be listed in the glossary Intro Thread above. ****************************************************** NEW MEMBERS READ THIS. http://consumers.creditnet.com/straighttalk/board/showthread.php?s=&postid=410243#post410243 ******************************************************* http://www.send4fun.com/telephone.htm >
Charge Off - Accounting term to indicate that the creditor does not expect to collect a balance owing on an account. When a creditor writes a debt off as a loss for tax reasons, it is called a charge off. They do this when the account becomes extremely delinquent. Make no mistake, this does not mean they have given up on collecting the debt. On the contrary, the creditor may sell the debt or turn it over to a collection agency.
paid charge-off isnt that a contradiction in terms? example, electric co says you owe an old bill, they tack in into your current one..its a charge-off on your CR. you pay the debt eventually in your monthly payments..all of a sudden your CR says 'paid charge-off' so, did they charge it off, take the loss and then get your money collected back to them on top of that? are there any tax gains or benefits for a charged-off account for a huge company like that?
when a CO is PAID, then that is INCOME which they need to report to offset the previous LOSS for the same account. The question is how do we know that they will actually do it like they are supposed to, ENRON comes to mind...
