Can a charged-off debt still be collected? – Q&A
People call and ask us this question when attempting to repair their credit. The answer is i simply….YES.
- A creditor still has the right to collect on a debt after they have charged the debt off.
- Most installment loan debts will be charged off 120 days after non payment.
- Most other debts will be charge off 6 months after non-payment.
- The IRS allows a creditor to take the charge off as a tax deduction against profits but contrary to popular belief the creditor can continue to collect the debt up to the specific statutes of limitations (varies state by state).