Debt Chicken
“Dear Steve,
Okay, so I did the ignoring thing with two credit cards and the banks charged them off. However, when I was finally able to pay them, I paid them off one through an attorney and the other a collection agency. My current credit reports shows the original creditor as charging them off and the collection agencies it reads Charge off or collections. I don’t want this coming back again after I already paid it.
What do you suggest? Writing the credit bureaus with copies of the proof that I paid? I am not so much concerned with what this has done to my credit as I am with the report showing accurate information.
Debt Chicken”
The Answer:
Dear Debt Chicken,
A charge off on a collection report just shows that the debt was once written off by the creditor. This does not mean that you still don’t owe the debt. You do. A charge off is a reporting and accounting requirement and does not invalidate the debt.
I’m not worried that the debt is shown as charged off. If it was charged off then your credit report should reflect that factual statement. However, what we need to look carefully at is the charged off debt is now showing a $0 balance due since you paid them back. If it is showing a zero balance then the credit report should be just fine as it is.
If it is not showing a zero dollar balance then provide proof to the credit bureaus that it was paid and ask them to update that. The charge off comment will remain.
