What are Credit Card Charge-Offs?
So, what are credit card charge-offs and why do you need to worry about them? Credit card companies charge-off accounts that have been late in their payments for over 6 months. Most people believe that the credit card charge-off is equivalent to canceling of the credit card balance. They believe that since the credit card company has charge-off their balance, they are not obligated to pay it anymore and that they can simply walk away from their debt. The Truth About Credit Card Charge-Offs The shocking truth is that credit card charge offs do not imply that your credit card debt goes away. In fact, it will come to haunt you for at least 7 seven years. Just because your credit card company has written of your balance as a loss or bad debt, does not mean that you are not obliged to pay it back. Every time a credit card company writes off outstanding payment as a bad debt, it reduces their overall profit margin even reduces its tax liability. To reduce their losses, credit card companies
