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How Can I Owe a Debt The Creditor Charged Off? – Janet

being sued by collection agency

have several charged off accts

a collection agency says i have a debt with them but the original creditor has charged off this acct how can i owe this collection agency anything?

Janet




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Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

4 Comments

  • Janet,

    To make the issue even more confusing. The creditor can still attempt to collect the debt after the statute of limitations expires, they just can’t sue you anymore after that.

    Steve

  • Hello Janet,

    When a creditor charges off an account it does not absolve the debtor of the obligation. Creditors are required to charge bad debts off their books but they still have the legal right to collect them. If they treat it as a loss this year, but then collect something down the road, they will have to add that back in as income, but that is not something that affects you.

    So whether this debt collector purchased the debt or the creditor just outsourced the collection to them doesn’t matter much. If you did borrow the money, and your account is still within the statute of limitations, they do have the right to go after you for the money.

  • Hello Janet,

    When a creditor charges off an account it does not absolve the debtor of the obligation. Creditors are required to charge bad debts off their books but they still have the legal right to collect them. If they treat it as a loss this year, but then collect something down the road, they will have to add that back in as income, but that is not something that affects you.

    So whether this debt collector purchased the debt or the creditor just outsourced the collection to them doesn’t matter much. If you did borrow the money, and your account is still within the statute of limitations, they do have the right to go after you for the money.

    • Janet,

      To make the issue even more confusing. The creditor can still attempt to collect the debt after the statute of limitations expires, they just can’t sue you anymore after that.

      Steve

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