Credit Card Charge-Off - How Bad Is
It?
So, you’re facing the dreaded “charge-off” that your creditor
has been threatening for months – how bad is it really? Well,
to be perfectly honest, if your account is already delinquent,
and nearly to the point of being charged off, your credit score
has already been compromised, therefore, don’t be intimidated
by your creditor stating that a charge-off is going to ruin
your credit; it’s already taken a “hit.” Rather, take the
necessary steps to remedy the situation if at all
possible.
You see, many people assume that a charge-off is no longer a
debt that is owed, and the account balance has been written off
by their creditor. Not true. Once an account is charged off it
is only “written off” as a bad debt, but the entire balance is
still owed; the account is simply reflected differently and is
no longer considered to be an account which generates income
for the creditor. But make no mistake; you will still owe the
entire balance.
If you’d like to avoid an account from charging off, contact
your creditor to inquire as to what the minimum payment would
be to hold the account at its current status. Oftentimes
creditors charge a certain percentage of the debt or minimum
monthly payment to work with debtors in an effort to avoid a
charge-off until the account can be either paid off or settled.
Whatever you do, however, please don’t commit to a payment that
you simply cannot make. I understand that creditors attempt to
coerce debtors into making a payment or post-dating a check,
but this will do you absolutely no good if you cannot follow
through with your promise.
Rather, let the account charge off and contact your creditor at
a later date, perhaps when you’re in a stronger position to
negotiate a lump-sum settlement through
debt
settlement.
This will allow you to pay the account in full, with no
further balance owed – possibly even through installments. Of
course, this can be discussed when you contact your
creditor.
In summary, charged off accounts aren’t the end of your world;
eventually your financial situation can be worked out with your
creditors. If you’re facing a charge-off and would like
additional information regarding your options, feel free to
visit www.DonaldsonWilliams.com
. Whatever your current situation may
be, there is an end in sight and you will once again be
free from debt.
If you should have any questions, or need assistance, feel free
to contact
us. For a free
consultation, click here. Remember, Donaldson Williams, Inc.
charges absolutely no monthly fee and no set-up
costs because we work on a contengency basis, and
you don't pay a fee for our services until after a
satisfactory settlement has been reached with your
creditor(s).
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